The September/October Phenomenon (Recipe for Financial Disaster?) Book

The various chapters of this work are discussions of those subjects and topics that I believe, when taken collectively, have had a major impact on our Economy because of the events of 9/11. That impact continues today. - Paul J. Murray

Who Should Be Interested In Reading This Book?



Anyone who wants a better insight into any of the following topics:




Y2K


Federal Reserve


Chairman Greenspan


Interest Rates


Terrorism



Anyone who has:


Ever invested in stock market


Ever paid a capital gains tax on a mutual fund distribution


Concern about our vulnerability to terrorism


Wondered why our economy and financial markets turned negative in 2001





Description of Book:



An attempt to identify and examine those financial institutions, economic events, and
tax policies, that were in place prior to 9/11 to see if there were any
interrelationships between these institutions, events and policies that could have led
to the timing of the attacks to have occurred when they did. If there were, in fact,
recurring events, then could these recurring risks be diminished or eliminated. The
various chapters of this work are discussions of those subjects and topics that I
believe, when taken collectively, have had a major impact on our Economy prior to
and because of the events of 9/11. That impact continues today.





What is the Book's Main Message and Its Importance?



There are some problems inherent in our tax system that causes artificial non-economic
trading in the stock markets to occur annually during the September/October time frame.
This trading is not in synch with economic conditions. It poses a problem because it
creates artificial weaknesses in the financial markets.



If anyone wanted to inflict economic damage to the financial structure of this country
they are most likely to achieve their goals during the months of September/October
during this phenomenon when mutual funds and financial institutions, in general, are
taking advantage of the selling by mutual funds who must, for taxation purposes,
distribute their capital gains by year end. Mutual Funds generally close their books by
October 31st in order to provide enough time to determine and distribute their gains in
compliance with tax laws.





Why Was This Book Written and What Was Learned as a Result?



This book was inspired by the events of 9/11 and my realization that there was
probably a sinister reason why it occurred during the September/October
Phenomenon. I was already interested in the influences of the Federal Reserve and
its actions (and inactions) relative to the interest rate yield curve. This relationship, I
suspected, pointed toward further weaknesses in the economy and the financial
markets. I suspected that there were some other events and policies that also
pointed toward this particular time. I needed to satisfy my own curiosity.



Hindsight being 20/20, I wanted to identify what could have pointed to this particular
time. I tried putting myself into the mind of someone who would want to inflict as
much financial damage on the economic stability of this great nation.



Was there a time when the maximum amount of financial and economic damage
could be inflicted? Could such a time be predicted? When would be the best time to
inflict a follow-up that could, or would be the coup-de-grace?



I wanted to use my unique training and experiences in this analysis. I felt that what I
was reading and hearing in the media was not going to the heart of the matter. The
potential financial impact and economic severity of the 9/11 attacks was not
adequately being presented nor understood.



It all came down to: What had occurred? Why had it occurred? Why did it occur at this
particular time? And, more importantly, could it occur again? If so, how could this
threat be thwarted?





What Will the Reader Gain By Reading This Book?



The reader will definitely gain knowledge of some of the problems inherent in our tax
system that cause non-economic and artificial trading in the stock markets that occur
annually during the September/October time frame. This trading has no relevance to
economic conditions. The reader will gain knowledge of this artificial weakness in the
financial markets and our vulnerability because of this.



Primarily, the reader will see the events of 9/11 from a different perspective. Also,
the reader will gain knowledge of some technical aspects of interest rates and the
financial system, timing of the stock markets as well as the interrelationships
between tax policy, financial markets and economic activity. Some of the predictive
qualities of watching various technical aspects associated with interest rates, yield
curves, advance/decline ratios and market activity will be gained.



Reader could reduce their investment risk by timing some of his investment activities
to coincide with the September/October Phenomenon (S/OP) if our law makers do
not eliminate this artificial restraint on normal market activity.



A reader will become more cognizant of some of the influences on the financial
markets - interest rate changes by the Federal Reserve, tax policies, seasonal
influences, etc.



Hopefully, the reader will improve his understanding of market influences and will be
more aware of the necessity to pay more attention to potential market influences and
their consequences.



The reader of the book can take topics of this book and apply them to their own
investment philosophy, situation and strategies. Armed with this information, the
reader might want to get active in petitioning lawmakers to change existing laws to
eliminate these artificial influences so that the long term market appreciation
potential is not artificially negatively influenced.



More importantly, changing the tax law (taxing the recipient of mutual fund capital
gain distributions) that imposes artificial influences would go a long way toward
elimination of the potential vulnerabilities in our financial markets.





How is This Book Different?



The uniqueness of this book is a result of the unique background and training I bring
to this analysis.



My formal education: BS in Economics. My early career was in Computer Systems
Analysis and Programming. That training I have used to this day. I have over twenty-eight
years as a professional in the financial services industry.



I have always been a student of technical analysis. I have market charts and data
that go back to the early 1970s. Early in my current career I was interested in
interrelationships between certain facts. Those early and ongoing observations
triggered thought processes and questions about 9/11 that I had to pursue. I did.
The book is the result of my inquisitiveness.