More Reality Bubbling Up in Financial Media
Remember that financial media's goal is to get you to read or listen to them. That's how they make money. So when they feel positive news grabs your attention, that's what you get. Most of the time, that's their game. (And their game doesn't necessarily reflect reality.)
On the other hand, from time to time, negative news pushes it's way into the mix. Sometimes it's like adding pepper to your plate: spices things up. Other times the actual news simply overwhelms any pretense at the usual positive spin. (Of course, occasionally, as in 2008, the media will indulge in an extended bout of negativity. It's something like binge eating or drinking. It's intense for a while, but inevitably it ends. It may capture a slice of reality early on, but eventually the dark side takes on a life of its own, until everyone's exhausted and wants to see some sunshine.)
In the midst of all this, our job is to stick to reality. That's so not only if you want to not only make good decisions regarding your money, but also if you want to stay sane. (By the way, apply this idea of sticking to reality to all media reports, not just the financial press.) Here are two ways to stick to reality: 1) Ignore the media; 2) Activate your reason and common sense reading or listening to all media stories and apply your rational faculties and experience to same, until you're satisfied you've either arrived at the truth or are darn close to it.
Here we present a good example of reality impinging on positive news. Our source is the Wall Street Journal:
On the other hand, from time to time, negative news pushes it's way into the mix. Sometimes it's like adding pepper to your plate: spices things up. Other times the actual news simply overwhelms any pretense at the usual positive spin. (Of course, occasionally, as in 2008, the media will indulge in an extended bout of negativity. It's something like binge eating or drinking. It's intense for a while, but inevitably it ends. It may capture a slice of reality early on, but eventually the dark side takes on a life of its own, until everyone's exhausted and wants to see some sunshine.)
In the midst of all this, our job is to stick to reality. That's so not only if you want to not only make good decisions regarding your money, but also if you want to stay sane. (By the way, apply this idea of sticking to reality to all media reports, not just the financial press.) Here are two ways to stick to reality: 1) Ignore the media; 2) Activate your reason and common sense reading or listening to all media stories and apply your rational faculties and experience to same, until you're satisfied you've either arrived at the truth or are darn close to it.
Here we present a good example of reality impinging on positive news. Our source is the Wall Street Journal:
U.S. sales at retailers and restaurants decreased a seasonally adjusted 0.9% in December from a month earlier, the Commerce Department said Wednesday.We now reference yesterday's post, which addressed just this topic, as it concerns the price of oil. It seems that the bubbling reality to which we referred has overwhelmed the long-standing "good news" of the fall in the price of oil. Lo and behold, a mere day after our post we find yet another nail in the coffin for all those who loudly proclaimed that oil's lower price would engender higher GDP based on increased consumer spending. Sorry gang, but there's simply no evidence that consumers have or will be goosing the economy anytime soon because they're spending less on oil. And given that these latest numbers are from December - the one month of the year where retail sales almost always increase, indeed the month that many business count on to make make their profit goals for the year - we can only imagine the impact on 2014 earnings, never mind the trend this may be setting for 2015.
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