Ignore the Urge to Bail

This column was originally published on RealMoney on March 14 at 6:39 a.m. EDT. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.

Bad. Real bad. Sell. Get out now.

There, I gave the bears what they wanted. It's so easy. It's what people want me to say. And it would be comforting. I have a big retail audience. I could easily panic them out of everything. Why not? Subprime could spread to prime. Bear(BSC Quote) and Merrill Lynch(MER Quote) bought subprime at the high. Mortgages are resetting higher like mad. Has to crimp consumer spending. The rot is deep, affecting everyone from GM(GM Quote) to GE(GE Quote).

There. I feel better. Or do I?

Why not be overwhelmingly gloomy? Why not just blow it all out here?

Cause I did it once, on this site. I looked at the world in October of 1998 and I couldn't believe how complacent everyone was, including the Fed. Didn't they know what I know, that the amount of money controlled by Long Term Capital was, at that moment, larger than any brokerage house's capital and could take down everyone?

What was the Fed thinking, being so complacent? The market was falling fast after being down all summer. Bankers were starting to flood the market with bogus dot-com paper. Bankers like Merrill Lynch and Lehman(LEH Quote) were telling us not to worry as their balance sheets were being taken apart. The contagion of Long Term Capital couldn't be contained. Everyone was using their playbook because they were supposed to be so smart.

So I gave the bears what they wanted and gave into my fears and I pulled the plug on this site, a little site then. What hope was there? Greenspan had just said the other day that the economy was chugging along. He left room for a rate hike. He was clearly out to chow.