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9:00 AM EST, Friday, November 14, 2008: The market went up and down faster yesterday than, as they say in Australia, a whore's drawers.

I don't know why it reversed its decline at 1 PM and roared upward. No one does. I don't believe that everyone suddenly had a revelation, "Things are now cheap. We've reached bottom. Get in bigtime." The only plausible explanation is that a lot of hedge funds are using the same computer trading algorithms. The computers kicked in and bought big-time. Nothing in the economy changed -- except that the latest economic news remains awful.

The big lesson remains -- if you're playing with shorts, get out when you're up a few shekels. I'm pleased that I wrote in yesterday's column:

We have made money on our Google shorts of the last few days. I'm tempted to say, "Take your profits." No one went broke taking a profit. I am convinced Google is on its way to $200. But the path will be volatile. Hence my advice. Take some money home. Money is as good as cash. And you can spend it -- but not at Best Buy.

I asked my most thinking broker (yes, some do exist) what happened at 1 PM yesterday? He explained, with simple eloquence:

Market hit technical LOW---and the MORONS decided, OK lets take it UP---And then the other MORONS said, I'm afraid to miss a rally, greed kicks in and we rally. It was MUCH easier to explain why we were DOWN 300 than why we were UP 500. ANYONE that believes that stocks are "cheap" I defy them to explain HOW? How do you value negative growth, economic rigor mortis---is that priced in--NO WAY in my opinion. Bottom line---no leverage available in economy--everyone fears their job. Santa will be on a respirator and the numbers will be HORRENDOUS over the next few months--People have stopped doing ANYTHING.

Then I consulted the Wall Street Journal. Heck, they have more resources than I do. They must know what really happened:

Dow Shakes Off Drop, Roars Up 552.59
The stock market had one of its biggest turnarounds within a day, as an early swoon turned into a rally -- giving investors hope that late-October lows will stand as the trough of the bear market.

The Dow Jones Industrial Average briefly dipped below 8000 at its intraday low, when it was down more than 300 points, before storming ahead to finish with a 552.59-point gain, up 6.7%, at 8835.25.

"We're not out of the woods yet, but this is the most encouraging thing that I've seen in a long time," said Michael Farr, president of Washington, D.C., money-management firm Farr, Miller & Washington. "I'm going to put in some of these buy tickets that have been sitting in my pocket."

The market's gains came despite continued signs of weakness in the consumer sector, an increase in weekly unemployment claims and a round of hedge-fund selling to raise cash around midday, traders said.

But after a three-day drop in which the Dow tumbled more than 7%, there was a sense that stocks had gotten cheap enough to warrant a round of bargain hunting.

The S&P 500 index rose 6.9% to 911.29, even after falling to 818.69 during the day, its lowest level since March 2003. Energy was the biggest winner, up 12% as oil futures rose for the first time in three days. Utilities, basic materials, and the consumer-discretionary sector were up nearly 8% each.

"You'd have to say this is a successful re-test of the lows," said Roger Volz, a trader at Hampton Securities in New York. ...

Economic news in the U.S. was poor. Before the market opened, the Labor Department said weekly jobless claims rose to their highest level in seven years, since the weeks following the 2001 terrorist attacks. Wal-Mart Stores, the nation's largest retailer, posted better-than-expected quarterly results but cut its full-year profit forecast.

Hedge-fund managers who face a mid-month deadline for investors to put in withdrawal requests are selling stocks to guarantee they have enough cash on hand.

Treasury prices fell, sending yields higher. The yield on the two-year note rose to 1.217% and the yield on the 30-year bond was 4.332%. The dollar fell 2.9% against the euro, snapping three days of gains, but it rose 3% against the yen.

Yesterday's boomlet gives us a nice opportunity to go back in today and short some obvious candidates like Google and Best Buy. But remember, Newton's inviolate rules are:

1. You must watch your shorts hawklike.

2. If they turn against you -- let's say 5% -- cover instantly, if not sooner.

3. .If you're up a nice bit, get out, The market will turn against you. More volatility is the only thing I can safely predict.

4. Try not to keep your shorts open overnight.

Frankly, I'm playing this game hugely at present. I need to play tennis, do some estate planning and move this web site to a reliable provider.

Useless facts, but facts nevertheless::

+ GM spends $2 billion a year on advertising. Can you remember one single GM ad? I can't.

+ Someone paid $3.5 billion for the Weather Channel.

+ The Blackstone Group, the giant publicly traded buyout firm, reported a $502.5 million loss for its third quarter as it was forced to mark down the value of its holdings across nearly all its businesses. And Mr. Steve Schwarzman, Blackstone boss, warned analysts and investors in a conference call that the fourth quarter would probably get worse, as many of its portfolio companies (i.e. the ones it invested in) get written down.

I don't want to die soon. But I have a bunch of illiquid assets -- private equity funds, leveraged buyout funds, real estate, pieces of private companies, etc. When I die, the IRS will rape my children with demands for instant cash. The only solution is to buy life insurance to cover the IRS's greed. More on this later. If you're in the same boat, you need to start the process today. Trusts. Insurance. Wills -- all the stuff which gives boredom a whole new meaning.

Your neglected web site. It's your calling card. It gets you business. It helps you sell things. Yet many of my friends screw around for months, endlessly mulling the words and the layout. They spend decades dealing with "designers," most of whom are useless.

Here's a dirty little secret: Anyone can start from scratch and get a simple, clean, persuasive web site up within an hour. You don't need a "designer." All the web site software -- my favorite is the old Dreamweaver 4 -- contains templates that you can slot your material into. Trust me, it's easy.

Body of Lies is worth seeing. The technology is awesome (and accurate). There's oodles of action. In the end, the good guys win. The movie raises serious questions -- like what the heck are we doing in that part of the world, wasting money, wasting lives and giving them even more reasons to dislike us even more? The story: CIA agent, Roger Ferris (Leonard DiCaprio) uncovers a lead on a major terrorist leader operating out of Jordan and he singlehanded saves the world. Definitely worth seeing.

This is a fake newspaper:

A bunch of volunteers printed a newspaper and put up a web site -- www.web.nytimes-se.com/. On their site, they write:

This special edition of The New York Times comes from a future in which we are accomplishing what we know today to be possible.

The dozens of volunteer citizens who produced this paper spent the last eight years dreaming of a better world for themselves, their friends, and any descendants they might end up having. Today, that better world, though still very far away, is finally possible — but only if millions of us demand it, and finally force our government to do its job.

It certainly won’t be easy. Even now, corporate representatives are swarming over Washington to get their agendas passed. The energy giants are demanding “clean coal,” nuclear power and offshore drilling. Military contractors are pushing the wars in Iraq and Afghanistan. H.M.O.s and insurance companies are promoting bogus “reforms” so they can forestall universal health care. And they’re not about to take no for an answer.

But things are different this time. This time, we can hold accountable the politicians we put into office. And because everyone can now see that the “free market” has nothing to do with freedom, there is a huge opening to pass policies that can benefit all Americans, and that can make us truly free — free to pursue an education without debt, go on vacation every once in a while, keep healthy, and live without the crushing guilt of knowing what our tax dollars are doing abroad.

Going cold turkey on paper: Excellent news. I'm surviving without the paper edition of the Wall Street Journal. With paper, I feel the guilt when UI read it (so much of it is irrelevant) and the guilt if I don't. With paper, I fill up garbage cans. The Journal publishes online a listing of all its stories -- click here. Scan them, read which ones you want and bingo, you're done.

And what of great significance did I learn from skimming today's Journal?

For the first time in recent memory, luxury-goods makers are cutting prices on designer apparel, shoes and handbags in the U.S. market.

With even the biggest spenders starting to scrimp, luxury companies from Chanel S.A. to Versace SpA, Christian Louboutin and Chloé are reversing the industry's maxim that luxury prices only move up. The cuts range from 8% to 10% on most products sold in the U.S.

But the move isn't likely to dent the profit margins of most European fashion houses because the value of the dollar has increased 28% against the euro since April. Luxury-goods companies don't disclose margins for their individual brands, but Louis Vuitton, one of the world's most profitable labels, is estimated to have a margin of 45 cents on every dollar.

+ GEORGIA PEACHES: California grown - 89 cents/lb.

+ JOINING NUDIST COLONY. Must sell washer and dryer. $300.

+ WEDDING DRESS FOR SALE. Worn once by mistake. Call Stephanie.

+ FOR SALE BY OWNER: Complete set of Encyclopedia Britannica, 45 volumes. Excellent condition. $1,000 or best offer. No longer needed. Got married last month. New wife knows everything.

The end of Wall Street. In case you mised yesterday, the era that defined Wall Street is finally, officially over. Michael Lewis, who chronicled its excess in the book Liar’s Poker, returned to his old haunt to figure out what went wrong. And boy, did he find some juicy stuff.

He has a written a long brilliant piece in CondéNast's increasingly excellent Portfolio magazine. Frankly, I recommend you drop everything and read this piece immediately. Click here.

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads on this site. Thus I cannot endorse, though some look interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Michael's business school tuition. Read more about Google AdSense, click here and here.