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Timing & trends

Be Wary of the Fourth Estate

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Posted by Craig Burrows

on Monday, 20 March 2017 17:11

craigburrowsEs tu Brute? The famous quote from Shakespeare’s Julius Caesar says a lot about what is going on in today’s world. Has the guardian of the people’s freedom, The Fourth Estate, gone too far in its rant to report / make the news. Has it become the greatest threat to democracy? If you watch American cable news, it has descended into an all time new low with anchors attacking each other’s anchors in 24 / 7 entertainment for audiences. What’s important about this as people move away from print journalism to 30-minute news segments that essentially get repeated 48 times in a day; the news is becoming about entertainment than real fact finding journalism. This should worry us because it’s the media more than any group that can affect markets and political policy to anticipate what the angry mob wants. The media has always been visceral but the difference today is the media anchors are elitist celebrities searching for ratings compared to the media of old: the angry, heavy drinking, chain smoking scribe with an axe to grind who wrote three articles a week and opinions were in bird cages the next day.

You may ask yourself, what does the media have to do with economics or investing in the markets? Everything. I learned a tough lesson that one “never gets in a fight with someone who buys ink by the barrel” and any politician or ex-politician understands the importance of that folly. Take politicians like Stanfield, Mulroney, Prentice, Harper and even Cameron what happens when the media turns on you. As former federal PC leader Robert Stanfield once said running against Pierre Trudeau; “if I walked on water, the next day the press would write ‘Stanfield can’t swim’”. This is important when it comes to the quality of people that decide to enter elected public service and why we are seeing a trend that villages are being represented by the village idiot. Of course, the word idiot is not literal, we have the Trump era to thank for that. What I mean by idiot is not qualified or “underordinary” instead of extraordinary people representing their constituents.

The media has had immense power to decide who will lead and what those political leaders make into policy and thus create the environment in which businesses and economies succeed or fail. Two recent elections in Canada were all about the media deciding who would win that election, Notley in Alberta and Justin Trudeau in Canada. All you have to do is review the press on why Prentice lost to Notley. There was no question that the PC’s in Alberta were on borrowed time and Prentice made some poor decisions before and during the campaign but the media propped up the NDP by attacking PC policy and saying nothing negative about Notley. They also did a favour for Notley by dismissing the Wildrose to encourage one alternative to the PCs. The TSN turning point of the campaign was when Prentice told Notley that “math was difficult” during a debate. Rather than admitting that math is difficult for Dippers, the media went on a condescending diatribe that here was a white middle aged successful businessman demeaning a successful woman and trying to keep her from breaking the glass ceiling. Poof, it was over because the only thing Canadians can’t tolerate more than a racist is a sexist.

Let’s look at Trudeau’s recent victory. First, Harper made a major mistake by not stepping down (attention Christy Clark in BC) and by calling a long campaign he fell victim to the first commandment of picking a fight with someone who buys ink by the barrel and now have 24-hour access to the airwaves. It was a slaughter and the CBC every night with Peter “Pink” Mansbridge and cohorts of socialist deplorables telling us how bad our lives were under Harper but they had to wait for the people to decide who they would support to replace him. Once the public discovered that by having Velcro, one doesn’t need to know how to tie one’s shoes, Trudeau was the favourite and the inquisition was on. The two lessons from these victories were that the media heavily influenced the outcome based on their own bias, and the classic lawyer strategy of “we don’t have to prove we’re right, we just have to prove them wrong”. All they did was point out the flaws of Prentice and Harper, never compliment them on their success, say nothing about Notley and Trudeau shortcomings and voila; the mass of sheep followed their queue.

But something has happened that should concern us all greater than the entitled Fourth Estate; it is when the masses no longer trust institutions designed to keep us from chaos. The media has done such a good job of tearing down the reputations of our institutions that it is actually incredulous to them that the masses are turning on them. Once in a while, the masses don’t follow the all knowing Fourth Estate. For example, Rob Ford as Mayor of Toronto. They tried but his populist rant was loved by the masses we call the silent majority. The more the media picked on him, the more popular he became. Remember when I said that Canadians can’t tolerate a racist or sexist? They actually hate the little guy being picked on – the classic David and Goliath scenario! When the media oversteps their blatant prejudice and people actually recognize it, they turn on the media. This explains Trump’s rise to power as much as it does Ford. Both are severely flawed characters but they had two things in common; both had PhDs (Papa had Dough) which means they had the finances to fight and had the ability to relate to the angry disenfranchised voter. The more the media goes after them, the more zealot the support becomes.

That is why Canadian journalists have concerns over Kevin O’Leary and the prospects of him being selected leader of the Conservatives. He has money, fame and doesn’t care if he wins. He often says the wrong thing but for some reason (a lot like Ralph Klein) people don’t care – they find him more endearing especially when the media attacks which they will do. The media doesn’t understand that they are part of the “Institution” and when people turn on the status quo, they turn on them. So, Brutus, when you stab Caesar in the name of the Republic, make sure that you’re not killing democracy.

Our next month’s article, the rise of the millionaire bureaucrat…

Craig S Burrows ICD.D

President & CEO, CCO

TriView Capital Ltd.

Life Plaza, Suite 605, 734 - 7th Ave SW, Calgary, AB T2P 3P8

O: 403 984-6570



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Timing & trends

Why the Crash & Burn is Public not Private

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Posted by Martin Armstrong - Armstrong Economics

on Monday, 20 March 2017 07:21

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"There are times when the private sector cannot stand and everyone runs to bonds/cash. Likewise, there are times when government can no longer stand and the only thing that survives is private assets. This took place during the collapse of the Weimar Republic (German Hyperinflation) and it has been the case throughout history even at the birth of the USA and the collapse of the Continental Currency."

...read more HERE

....also from Martin: The Crash & Burn

- what will the “Crash and Burn” look like? Will it be worldwide or specific to a few countries like the US? Will it be in the form of a financial crash, food shortages, violence in the streets, all the above or in some other form? ....read Martin's Crash & Burn response HERE



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Timing & trends

The 3 Most Popular Articles Of The Week The Week

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Posted by Money Talks Editor

on Saturday, 18 March 2017 08:05

1. One of the Most Effective Trading Tools for Investors

The study of cycles. Quantified and cataloged historical cycles stretching back hundreds and even thousands of years. Combined with cyclical pattern recognition across hundreds of markets and individual securities.

....read more HERE

43933 c2. Fanaticism, Stock Market Crash 2017 or Continuation of Bull Market

Not too long ago this bull market was one of the most hated in history; that no longer appears to be the case.

....continue HERE

 

3. Largest New Discovery of Oil in USA - Fed Raises Rates Markets Rally

    by Martin Armstrong

A major discovery of oil has been made in Alaska of 1.2 billion barrels. The largest find of conventional oil for 30 years on US territory.

"The Fed’s forecasts have moved in the direction of tightening, and despite what they say publicly, the most serious stimulus is rising stock prices"

...continue reading HERE



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Timing & trends

Fed Hikes, Markets Yawn

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Posted by Bill Bonner - Diary of a Rogue Economistist

on Thursday, 16 March 2017 10:49

4701 The Fed gave us another quarter-point rate increase yesterday. That makes the third such hike in the last 10 years! 

Whoa! Hold on… We can’t take that much excitement.

But wait… The Fed also signaled that it may abandon its “data dependent” position and take the lead. 

Instead of reacting to the news… it may lead the world’s interest rate levels back to normal, regardless of what the headlines tell it.

Oh, dear reader, you already know this is not going to happen. The Fed can never voluntarily return to sound money and market-set interest rates. 

It presides over the biggest bubble in stocks and bonds the world has ever seen. Without underpriced credit, the whole thing would collapse. 

That’s why the Fed can only take baby steps toward normalization… and only so long as they don’t matter.

We’re entering our ninth year of near-zero interest rates. During that time, businesses, investors, speculators, and consumers have adapted to extraordinarily cheap credit. 

They’ve used it to refinance their debts… and drive up their stock prices. They’ve used it to sell automobiles and buy houses. 

The big players have gotten used to gambling with money that is almost free. And if they get into trouble, they can borrow more.

If the cheap-credit system were to end – or even if people were to think it is coming to an end – it would take about two minutes for the whole capital structure to fall apart. 

Businesses couldn’t refinance. Bonds would crash (except for U.S. Treasurys… which would get a temporary boost on “safe haven” buying). 

Stocks would repeat their move of 2008–’09, but probably worse.

Crash Risk



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Timing & trends

Fed Rate Hikes, Fiscal vs. Monetary Policy and Why Again the Case for Gold?

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Posted by Gary Tanashian - NFTRH

on Wednesday, 15 March 2017 06:29

I’ve been thinking about the current Fed Funds rate hike cycle, which is logically gaining forward momentum now that the Fed can stand down from its 8-year, ultra-lenient monetary policy cycle.  That is because the Obama administration’s goals required a compliant Federal Reserve to continually re-liquefy the economy as its fiscal policies drained it.

With the coming of Trump mania and its very different fiscal policy goals, we will witness the end of much of what I considered to be the “evil genius” employed by the Federal Reserve, mostly under Ben Bernanke.  When he oversaw the brilliant and completely maniacal painting of the macro known as Operation Twist in 2011, I knew we were not in Kansas anymore.  We’d gone off the charts and off the balance sheet into a Wonderland of financial and monetary possibilities.

What else would you call a plan to sell the government’s short-term debt and buy its long-term debt in the stated effort to “sanitize” (the Fed’s word, not mine) inflationary signals on the macro?  It was evil, it was genius, and it worked.  So too did various other financial manipulations that took place before and after Op/Twist.  And here we are.

The Republican view is one where businesses and consumers are stimulated, not money supplies.  I think it is a better economically, but not by much in this case.  That is because the Trumpian ‘reflation’ would simply be another form of man-made stimulation attempting to deny market and economic excesses from being cleared.  A normal economy goes through normal cycles.  We have not had a normal economy or a normal cycle since at least pre-2000.

Since Alan Greenspan panicked and blew the credit bubble of last decade, we have been on a continuum further into uncharted waters.  Trump’s policies are not going to stop it, either.  Besides, he inherits this (chart source: SlopeCharts).

mi-sp500-base



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