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The News Just Ain’t The News No More

Sep 212018

September 21, 2018 Posted by Raúl Ilargi Meijer at 1:35 pm Finance Tagged with: accusations, Assange, evidence, Facebook, Google, innuendo, Kavanaugh, NYT, opinion, polarization, proof, Trump, Twitter, WaPo 19 Responses »

M. C. Escher The Tower of Babel 1928

Two thirds of Americans get at least some of their news on social media. Google and Facebook receive well over 70% of US digital advertising revenues. The average daily time spent on social media is 2 hours. Just a few factoids that have at least one thing in common: nothing like them was around 10 years ago, let alone 20. And they depict a change, or set of changes, in our world that will take a long time yet to understand and absorb. Some things just move too fast for us to keep track of, let alone process.

Those of us who were alive before the meteoric rise of the hardware and software of ‘social’ media may be able to relate a little more and better than those who were not, but even that is not a given. There are plenty people over 20, over 30, that make one think: what did you do before you had that magic machine? When you walk down the street talking to some friend, or looking at what your friends wrote on Facebook, do you ever think about what you did in such situations before the machine came into your life?

From 10% to 75% in 10 years

We’re not going to know what the hardware and software of ‘social’ media will have done to our lives, individually and socially, for a very long time. But in the meantime, their influence will continue to shape our lives. They change our societies, the way we interact with each other, in very profound ways; we just don’t know how profound, or how, period. There can be little question that they change us as individuals too; they change how we communicate, and in such a way that there is no way they don’t also change our very brain structures in the process.

Someone who walks down a street talking to someone else 10, 100, 1000 miles away, or sees messages from such a person come in in virtual real time, experiences things that were not available ever in human history. Our brains must adapt to these changes, or we will be left behind. And while for the over-20, over-30 crowd this takes actual adaptation, for those younger than that it comes quasi pre-cooked: they’ve never known anything else. Still, their brains were formed in completely different times too. Think hunter-gatherers. And that’s just the human part of the brain.

There are too many aspects to this development to cover here. One day someone will write a book, or rather, many someones will write many books, and they will all be different. Some will focus on people’s lives being saved because their smartphones allow them to either receive or send out distress signals. Others will tell stories of teenagers committing suicide after being heckled on ‘social’ media. With yin comes yang. Millions feel better with new-found ‘friends’, and millions suffer from abuse even if they don’t kill themselves.

With new media, especially when it goes from 1 to 100 in no time flat, it should be no surprise that the news it delivers changes too. We went from a few dozen TV- and radio stations and newspapers to a few hundred million potential opinions in the US alone. The media are no longer a one-way street. The first effect that has had is that the chasm between news and opinion has narrowed spectacularly. If their readers post their views of what they read and see, journalists feel they have the right to vent their opinions too.

And then these opinions increasingly replace the news itself. The medium is again the message, in a way, a novel kind of way. A hundred million people write things without being restricted by due diligence or other journalistic standards, and we see journalists do that too. They will come up with lies, half-truths, innuendo, false accusations, and moreover will not retract or correct them, except when really hard-pressed. After all, who has the time when you post a hundred+ tweets a day and need to update your Facebook pages too?

Obviously, Donald Trump is an excellent example of the changing media environment. His use of Twitter was a major factor in his election victory. And then his detractors took to Twitter to launch a huge campaign accusing him of collusion with Russia to achieve that victory. They did this moving in lockstep with Bob Mueller’s investigation of that collusion accusation. But almost two years after the election, neither Mueller not the media have provided any evidence of collusion.

That, ironically, is the only thing that is actually true about the entire narrative at this point. Sure, Mueller may still have something left in his back pocket, but if he had solid proof he would have been obliged to present it. Collusion with a foreign government is too serious not to reveal evidence of. Therefore, it’s safe to conclude that in September 2018, Mueller has no such evidence. But what about the thousands of printed articles and the millions of Tweets and Facebook posts claiming collusion that were presented as true?

Funny you asked. What they prove is not collusion, but the changing media landscape. The anti-Trump echo-chamber that I’ve written about many times has been going strong for two years and shows no signs of abating. There are still lots of people posting a hundred (re-)tweets etc. daily who are being read by many others, all of them confirming their biases in a never fulfilled feeding frenzy.

This is not about Trump. And I’m not a Trump supporter. This is instead about the media, and the humongous difference interactivity has made. And about the fact that it hasn’t just added a hundred million voices, it has also altered the way traditional media report the news, in an effort to keep up with those hundred million.

The thing here that is about Trump, is that he’s everybody’s favorite meal ticket. He confirms everyone’s opinion, whether for or against him, by the way he uses media. And most importantly, they all make a lot of money off of him. The New York Times and WaPo and MSNBC would be in deep financial trouble without Trump. Like they were before he came along. Polarization of opinions saved them. Well, not the WaPo, Jeff Bezos can afford to run 1000 papers like that and lose money hand over fist. But for the NYT and many others a Trump impeachment would be disastrous. Funny, right?

Another thing that is obvious is that one thing still sells above all others: sex. The smear campaign against Julian Assange has been successful in one way only, and it’s been a smash hit: the rape allegations. Completely false, entirely made up, dragged out as long as possible, and turning millions, especially women, against him.

The accusations against Supreme Court candidate Brett Kavanaugh haven’t been around long enough to be discredited. Maybe they will be, maybe they won’t. But read through newspaper articles, watch TV shows, follow Twitter, and you see countless voices already convinced ‘he did it’. And that ‘it’ is often labeled ‘rape’, though that’s not the accusation.

But it’s part of the Anti-Trump train, and the echo-chamber has gone into overdrive once again. Even if everyone understands that a 36-year old accusation must be handled with care. The accusing woman’s lawyer says the FBI must investigate, and everyone says: FBI! FBI!. Conveniently forgetting that the FBI has been far from impartial with regards to Trump, and the White House is not exactly waiting for another FBI role.

What’s wrong with waiting till you know the facts? Why judge a situation you know nothing about other than a woman accuses a man of assault 36 years ago, and doesn’t remember time, location etc.?

And that’s the thing all along, isn’t it? That people, both readers and journalists, all 200 million Americans of them, think they have acquired the right to judge any person, any situation they read a few lines about, just because they have purchased a smartphone. A faulty notion fed on a daily basis by the fact there are millions who think just like them.

We may want to rethink the terms ‘social’ media and ‘smart’ phone. They sound good, but they don’t cover the true nature of either. It’s hard to say where all this is going, but the sharply increasing polarization of society is certainly not a good sign. People feeling they have the right to accuse others without knowing facts, people building a Russiagate narrative without evidence, these are not things a society should welcome, whether they’re profitable or not.

Meanwhile, there are two people (there are many more, of course) who were banned from the platforms so many others use to draw baseless conclusions and spout empty accusations. And we miss them both, or we should: Alex Jones and Julian Assange. Have they really used ‘social’ media in worse ways than those 200 million Americans? Or were they banned because millions of Americans were following and reading their non-mainstream views?

We better get a grip on this, and on ourselves, or we won’t get another chance. What we have seen so far is that it’s not that hard to shape people’s opinions in a world with information overload. And that process is about to get a whole lot more intense. Until all you’re left with is the illusion that your opinion is actually your own.

Trump Territory

Apr 212018

April 21, 2018 Posted by Raúl Ilargi Meijer at 12:43 pm Finance Tagged with: Lynch, May, MSM, NYT, racism, Syria, territory, Trump, UK, visit, WaPo, Windrush 11 Responses »

Arthur Rothstein Lower Broadway, New York 1941

British media report today that Donald Trump may visit the country in late summer. (Renewed) calls for mass protests are everywhere, of course. The Metro news outlet features a picture of a pamphlet that reads No To Racism. No To Trump, that dates from an earlier occasion (Trump was supposed to come several times, but never did).

Now, good luck with those protests, it’s still a free country, in name at least. But boy oh boy, would you guys miss the point. Because as we now all know – or could-, your country is being governed by a group of people who are so racist they make even Trump’s fake tan pale in comparison. If Theresa May is still in office by the time Trump visits, you’re all a bunch of racists.

Both May and her Home Secretary Amber Rudd – and you all know they’re far from alone- look so completely deranged in reports about the Windrush scandal that you will have to get rid of them first, or else shut up about Trump because you will have no moral ground whatsoever left on which to protest his visit.

For those of you who don’t know what Windrush is about, and if you’re British you have no excuse not to know, it’s the name given to a group of people who arrived, on invitation, in Britain between the late 1940s and early 1970s, often as children, and whose legal status in the country is now put in so much doubt that some have already been deported, some are denied health care, and all live in fear. Despite having lived and worked and paid taxes all their lives.

There are many instances of people who have never left Britain for a family visit, some who can’t see their own children because they did go for that visit and weren’t allowed back in, the entire story is so appalling and disastrous it’s hard to read the various reports on it. The common denominator of all of these people? They are black.

Windrush: When Even Legal Residents Face Deportation

In the aftermath of World War II, the British government invited thousands of people from Caribbean countries in the British Commonwealth to immigrate to the United Kingdom and help address the war-torn country’s labor shortages. Now, nearly 70 years later, many of those same people, now elderly, are having their legal status in the country questioned and are facing deportation. Though the deportation threats date as far back as October, the crisis burst into wider view this week after Caribbean diplomats representing a dozen Commonwealth nations chastised the U.K. government publicly. “This is about people saying, as they said 70 years ago, ‘Go back home.’ It is not good enough for people who gave their lives to this country to be treated like this,” Guy Hewitt, the high commissioner from Barbados to the U.K., said at a gathering of the diplomats.

As for the Guardian, which claims it broke the story, here’s a question: where were you all those years? As for Theresa May, who when she occupied the Home Office from 2010-2016 and devised all manner of tough-on-immigrants measures that have now spread to people the UK itself invited into its nation: you have to go. You cannot continue to be the face of Britain, because you blemish any and all of your fellow country men and women.

As for Donald Trump, as much as we would like to engage in constructive criticism of the man and his government, we find we no longer can. The anti-Trump echo-chamber has turned so deafening that any intelligent debate about his policies is being drowned out amid the never ending flow of fake news and half truths and innuendo and empty smears that US media continue to spout. With a brief lull when the bombs fell on Syria.

Thank you, New York Times, WaPo, CNN, MSNBC. Thank you for killing the entire discussion, thank you for killing off journalism. There is a lot to say about Trump, much of it critical, but we can no longer open our mouths. Because we don’t want to be in the same camp as you. Life in the echo chamber has given us vertigo. We had to get out.

And now, what are you going to do? The DNC lawsuit-for-campaign-cash which was launched yesterday against everything Trump, plus Wikileaks, plus everything Russia, may appear to you to be a nice and juicy next episode in your ‘impeach the comb-over’ narrative, but if I were you, I’d be careful. Because the suit creates the ideal ground upon which the empire can strike back.

And the counter suits look a lot stronger. The DNC has nothing on Russia, Wikileaks and most Trump affiliated people and organizations, as the Mueller investigation has shown by now. But Loretta Lynch, the “Pakistani mystery man”, Debbie Wasserman Schultz, Comey, McCabe, and many more around Hillary Clinton, that’s a whole different story.

First of all, they haven’t been investigated for well over a year. But can you see Rosenstein now still refusing to appoint a second special counsel and going after anything Democrat? It would cost him his job, and for good reason. And then what will the place of the echo chamber be? What have been your sources on Trump et al over the past, let’s say, 18 months? How are you going to report on your own role? Someone’s going to ask these questions.

And, you know, you do know that at least someone will name Trump for the Nobel Peace Prize if he pulls off ‘pacifying’ North Korea. How will you address that? See, you can’t praise the Donald anymore even if he does achieve things -other than missiles-, and we can’t criticize him anymore for what does indeed go wrong because you monopolized that criticism with your opinionated 24/7 non-news. While claiming to be the serious press.

Trump must be very grateful to you for what you’ve done. Come to think of it, perhaps that second special counsel should look into any payments you have received from Russia. Because nobody has helped Trump more than you have. Except perhaps for the Britons who plan to protest his visit with their racist prime minister.

Why do I feel like most of the world has lost its compass? Like we’re all just aimlessly bobbing around on a sea of meaningless words? You know, Trump territory.

Shithouses

Jan 292018

January 29, 2018 Posted by Raúl Ilargi Meijer at 8:02 pm Finance Tagged with: Congo, echo chamber, Haiti, NYT, occupation, plunder, shithole, slavery, Trump, Twitter, WaPo, warfare 5 Responses »

Lucien Hervé The Accuser, Delhi, India 1955

Tomorrow we have the State of the Union. Donald Trump will be gloating from ear to ear, but he’ll be subdued – by his standards. Expect perhaps $1 or even $1.5 trillion in infrastructure spending to be announced, plus an immigration plan that gives Democrats much of what they want in exchange for some of the things Trump wants, as well as more on trade surpluses and deficits. The Democrats will attempt to turn it into a circus of sorts by bringing guests, and they will fail.

What America needs right now is dialogue, but it’s only moving further away from it. Anything that’s wrong with anything or anyone gets blamed on Trump. By half the population. That’s nice and easy and convenient, but it doesn’t lead anywhere.

This pic, even though it features a very dumb question, says a lot about where the country stands, and it’s not standing pretty. Everybody’s just busy confirming their own opinions 24/7, egged on by networks, newspapers and social media. It’s like Moses split the nation.

Watched the Trump speech in Davos last week. He made all the points you would expect him to. No scandals, nothing anyone could blame him for. In fact, it’s true that the US economy is doing well, in Trump terms. They’re not my terms, because they laud stock markets that quit being actual markets the moment the Fed and it global brethren killed off price discovery. But in Trump terms a record S&P 500 is all you need to know, alongside low unemployment numbers, even if the latter have everything to do with underpaid shit jobs robbed of all benefits American workers once fought so hard for.

In Trump’s view, that’s a good thing. In mine, it’s a recipe for mayhem. I was watching CNN in the build-up to the speech, and Trump’s denial of the NYT report that he had intended to fire Special Counsel Robert Mueller was completely ignored. Like he never said it. At CNN, anonymous sources have -way- more credibility than the president. That’s a bit of a problem.

After the speech, all sorts of people were interviewed, and Joe Stiglitz of Nobel Memorial fame was one of them. He couldn’t muster anything better than that Trump is a bigot, a misogynist and a racist. That’s a terribly poor reaction to a speech like the one we saw and heard -which included not one word that would make any sane person think of these ‘topics’-, certainly from an economist.

The 1-year-old Donald Trump presidency has brought us a lot of new things, but none more significant than that Trump has been under investigation since day 1 (and even before that). This sets a dangerous precedent that will resound through US politics for a very long time to come, not least of all because today, one year into the presidency, none of the investigations has resulted in anything tangible, while they continue without a finish line in sight.

The problem with that is that if you can do it with one president, someone will do it with the next one and the next one after that as well. Which does great damage not to Trump, but to the entire US political system, and the Office of the President of the United States in particular. If the office cannot command sufficient respect on Capitol Hill to limit any such investigation to an absolute minimum, in deference to what it represents, why would anyone else, domestically or abroad, show such respect?

Obviously, some people may claim that the situation is unique, simply because it concerns Trump, but that argument doesn’t fly very far, because he was elected president, the culmination of a process that, given the powers endowed upon the office, should be close to sacred in the country. And if the very people (s)he must most closely work with, in the Senate and the House, are willing to subject a newly elected president to endless investigations without producing any results for a whole year, where and what are the limits?

It is at present of course all based on opaque accusations of the Trump campaign working with Russian intelligence to swing America’s election process in favor of the president. But to date, four different committees on Capitol Hill, plus Special Counsel Robert Mueller, have made nothing public that proves any such ‘collusion’. And Mueller’s investigation is not only unlimited in time, it’s also unlimited, in practical terms, in scope: whatever is deemed even possibly, perhaps, linked to collusion with Russia, goes.

The American empire was built, once it had acquired enough geopolitical, financial and military power, on invading countries and turning them into shithouses. It wasn’t and original idea, America wasn’t the first country to do it, but it’s certainly been no. 1 in applying the ‘tactic’ over the past 100 years and change. Which makes it curious that when its own elected president calls some countries shithouses, that is treated like the worst thing anybody could have said anytime in history. And racist too, allegedly.

The entire country was built on racism, and it’s still to his day almost exclusively run by white males. Much of the racism may be hidden by now, but it’s still very much there. Go look at Baltimore, Chicago, Milwaukee, and the long list of black kids killed by white cops. It’s not much use trying to claim that America is over its past. But Trump is singled out as a racist, though it’s unclear what would make him worse than others.

And on Martin Luther King Day, all Democrats and many Republicans fell over each other once again claiming they knew exactly what Dr. King stood for in his days, and what he would have said if he were alive today (the same they thermselves say). They don’t have a clue. The only way to honor MLK is to assume he would have been lightyears ahead of you. To assume he would have condemned all US foreign as well as domestic policy, and the likes of Bill Clinton, both George Bushes, Trump, and even Obama, wouldn’t even have had a remote chance of becoming president.

Allegedly Trump never said “shithole countries”, but instead talked about “shithouse countries”. Which would explain why he could say he never used the language he was quoted as having used (“Why are we having all these people from shithole countries come here?”) That a private conversation with lawmakers held in the Oval Office was leaked again within no time will not only frustrate Trump to no end, it also paints a dangerous picture of the future of US politics.

What used to be the exclusive domain of police officers and TV series, the catchy line “anything you say can and will be used against you”, no longer applies only to suspected criminals, from here on in it should be read to American presidents too. Trump and his successors will no longer be able to discuss policy in the White House, they must assume everything they say will be in the press within hours if not minutes. That is dangerous.

But let’s dig some more. And ask ourselves what is worse, let alone more racist: turning nations into shithouses or calling them that after the fact. Half the planet was encouraged to speak out in indignation at the use of the term, but where were all those Americans when the bombs and drones were unleashed upon Syria, Libya, Iraq? Where were the media?

Trump singled out Haiti and El Salvador. Two completely different ‘cases’. But also too complete basket cases (another word for shithouse) , compared to their potential. Haiti was the first slave colony to liberate itself, under black rule. That was in 1804, and if you know what Americans’ view of slaves and black people in general was back then, you can imagine how the former no. 1 global sugar producer was treated. By France, the country that had ruled it, but also by America. And you want to claim Haiti is not a shithouse country today? Go to Port-au-Prince and ask people living in the poor part of town how they feel about that.

As for African countries, the Congo is always a good example. The richest nation on the planet when it comes to natural resources, and one of the poorest when it comes to living standards. Long governed by a regime under Belgium’s King Leopold, matched in cruelty only perhaps by Germany in WWII, the Congo is still maintained as a hellhole to this day. So American and European conglomerates can dig up the metals and minerals almost for free. Not a shithole, a hellhole.

No, Trump is not going to solve that, but he didn’t make it what it is either. Generations of Americans did that. Yeah, we understand why they don’t want it named the way Trump has.

Perhaps the best illustration of how convoluted the entire issue quickly became after Trump said shithouse, which then became shithole, is this LA Times article, which starts out with the headline that Americans with African roots ‘should’ all be insulted, but then rapidly devolves into something else altogether, that insults them a lot more: the history of American involvement in their countries. Slavery, occupation, warfare, plunder.

For Black Americans, Trump’s ‘Shithole’ Comment Was An Insult To Their Histories

Kimberly Atkins, the Washington bureau chief of the Boston Herald, recently did a DNA test “that pretty much confirmed my heritage is 100% the result of the slave trade,” she wrote in a private message on Twitter. “Eighty-seven percent from western coastal African countries and 13% European, all migrated by way of the American South.”

She traced part of her heritage to an ancestor who fought in the Union during the Civil War to guarantee his freedom and the abolition of the U.S. slave trade. “My ancestors did not come from shithole countries,” she tweeted. “They were neither tired nor poor. They were forcibly brought here to live in a shithole created for them.”

Trump’s singling out of Haiti was particularly frustrating for descendants from the Caribbean nation, coming as the nation mourned the eighth anniversary of an earthquake that killed hundreds of thousands of residents.

“Haiti is not unacquainted with racists or white supremacists. We defeated our share of them in 1804 when we became the world’s first black republic,” Haitian American author Edwidge Danticat wrote in a post on Facebook, expressing her frustration that Haitians’ mourning was being diverted by an insult from Trump.

Danticat’s father came to Brooklyn, N.Y., to drive a taxicab “sometimes sixteen hours a day, so that my three brothers (two teachers and an IT specialist) and I could have a better life,” Danticat wrote.

Danticat added: “We are also the country that the United States has invaded several times, preventing us from consistently ruling ourselves. If we are a poor country, then our poverty comes in part from pillage and plunder.”

Clint Smith, a writer and PhD candidate at Harvard University specializing in sociology and education, said that he hoped that at least the president’s remarks would prompt a fuller conversation about past U.S. and European involvement with the countries Trump mentioned — countries still troubled by the legacy of colonial rule and military interventions.

“You can’t understand the economic conditions in which Haiti exists now without understanding the centuries and centuries of direct imperialism and violence and economic exploitation that the country experienced after the Haitian revolution of 1804,” Smith said. “We can’t have a real conversation about what is happening, why Salvadorans are coming here, without discussing how the U.S. contributed to the civil unrest in that country.”

The larger conversation, Smith said, “is not often enough taking into account the way that U.S. policy directly contributed to the condition in which so many of these so-called shitholes are currently existing.”

The woman who says “My ancestors did not come from shithole countries” says it best. Before the slave traders came to ship their ancestors to Brazil and later America, their countries were not shithouses. But they did become just that after, and many if not most still are now.

From a less echo chamber-confined point of view, this little thingy is priceless:

That points to an aspect of all this that we can not ignore: the media. There has a been a profound shirt in that field, and it happened fast, it turned on a dime. The first signs were already there before the Trump presidency, but it’s all been going going gone out of the park since. Media organizations (for lack of a better term) like the New York Times, the Washington Post, MSNBC and CNN were anti-Trump from the get-go, but it was when they found out their attitude was commercially very interesting that they really went for it.

And in a way, that made sense; they all had big problems trying to adapt their business models to the internet age. Then they found that publishing one after another anti-Trump piece brought them tons of new subscribers and advertisement revenue. Also for their internet presence. One stone, two birds.

The problem is that all that revenue and readership comes from one half of America, and excludes the other half. You know beforehand that anything these firms publish about Trump will be biased, and not a little bit. Much of it is based on anonymous sources, not exactly a sign of solid journalism. But it sells. And they have a business to run. We get it.

For those outside of the echo chamber, however, they have become largely unreadable and unwatchable. It’s obvious by now that someone like me, who asks a few questions and doesn’t feel comfortable in an echo chamber, will almost of necessity be ‘accused’ of being a Trump supporter. Absolute nonsense, but that’s echo chambers for you. They’re deafening and they lead to brain damage in case of long term occupancy.

Perhaps even worse are social media, where untold numbers of people revel in the notion that many others think like them, and let that carry them away to ‘heights’ they would never have thought possible. In the case of Trump, many allow themselves to call him names -in writing- they never would have dared use before, but they see echoed back to them on Twitter and Facebook et al.

That their often insults of Trump in effect show their disrespect for America’s political system would never occur to them. It’s an us against them battle, and they feel greatly emboldened by the 24/7 presence of those that are like-minded. It’s entirely unclear where this is going in the future, but it should be obvious it won’t be anywhere pretty.

Neither Bob Mueller nor those 4 committees on Capitol Hill have presented anything of substance as of now, but it’s crystal clear that Donald Trump is not being considered innocent until proven guilty. Which not only goes straight against, and into the heart of, American values and principles of justice, it also doesn’t even begin to address the real problem.

The real problem, and it’s not new at all, is that both US political parties might as well be run by Tony Soprano. The presence inside party leadership of people like Steve Wynn is ridiculous, but so is that of John Podesta. That is undoubtedly blindingly obvious for a vast majority of Americans, but it’s not what they focus on. They focus on Trump instead, on the still contagious obsession with impeaching him, even though many understand that wouldn’t solve any of the underlying issues.

And then Trump gets to present great economic numbers tomorrow. The numbers are mostly fake, but they’re the same ones that the echo chamber media also use, so they’ll have to tackle him somewhere else. They’ll come up with something, don’t worry. Their audience will just wait to be fed the usual pre-chewed bite-size fare anyway.

America needs a dialogue. But all it has left is loud, echoing, deafening, monologues. And plenty shithouse counties and cities and neighborhoods within its own borders as well. For which, too, it’s useless to blame Trump. He’s just the logical conclusion of years of blindness, ignorance, greed, stupidity and neglect. All of which, as long as everyone focuses on him, are guaranteed to continue.

Trump is not what’s wrong with America. Rather, what is wrong with America is what has given it Trump. Someone asked God for a sign and He said: here you are.

Little shithouses for you and me

Debt Rattle July 30 2017

Jul 302017

July 30, 2017 Posted by Raúl Ilargi Meijer at 8:33 am Finance Tagged with: collusion, Dow, leasehold, refugees, resilience, tarsands, time bomb, tweets, VIX, WaPo, zombie Comments Off

Gertrude Käsebier Young negro woman, Newport, Rhode Island 1902

• Wall Street Isn’t Ready For A 1,100-Point Tumble In The Dow Industrials (MW)

• Dangerous Game: Shorting the VIX (Barron’s)

• Zombie Companies Littering Europe May Tie the ECB’s Hands for Years (BBG)

• Markets Relax Merrily on a Powerful Time Bomb (WS)

• US Economic Resilience Is An Exaggeration (DDMB)

• The Quest To Prove Collusion Is Crumbling (WaPo)

• What’s The Matter With Democrats – Thomas Frank (IBT)

• Decades From Now, They’ll Say He Had “The Tweets” (Jim Kunstler)

• Leasehold Tycoon Whose Firms Control 40,000 UK Homes (G.)

• Companies Abandon Nearly One Million Hectares of Alberta Oilsands (CP)

• EU Accused Of ‘Wilfully Letting Refugees Drown’ In The Mediterranean (Ind.)

And it never will be.

• Wall Street Isn’t Ready For A 1,100-Point Tumble In The Dow Industrials (MW)

The U.S. stock market has been on such a parabolic march higher that Wall Street investors may have forgotten what a typical, sharp downturn feels like. Indeed, much has been made about the lack of volatility. The CBOE Volatility Index otherwise known as the “fear gauge,” had been flirting with its lowest close on record, implying that market expectations for a sharp, sudden fall are near rock bottom, as the Dow Jones Industrial Average, S&P 500 and the Nasdaq Composite Index scale new heights. (The Dow notched a fresh record on Friday to end the week 1.2% higher.) The recent level of complacency permeating the market has pundits talking about the lack of 5% falls in the market—an occurrence that isn’t unusual in a normal market environment. However, a 5% tumble, while normal, isn’t that common either. It has occurred at least 75 times over the course of the blue-chip index’s, according to WSJ Market Data Group, using data going back to 1901.

The Dow, however, hasn’t experienced a 5% decline since 2011, and before that a 5% drop hadn’t happened since 2008, when there were 9 such drops: At this point, with the Dow just 200 points shy of 22,000, a 5% selloff would equate to a 1,100-point, one-day slide in the gauge. Is the market ready for that sort of sudden jolt lower, given the optics of a quadruple-digit downturn and how it might rattle investment psyche? Art Hogan, chief market strategist at Wunderlich Securities, doesn’t think so. “I would say no because we’re out of practice. Your usual standard garden-variety volatility just hasn’t been around, and we haven’t seen it for 12 months,” Hogan told MarketWatch. “Quiet markets have been the norm and not the exception and I think a major pullback is going to feel a whole lot larger for lack of experience and the numbers are larger,” he said.

Even a 2.5% drop in the Dow, adding up a 550-point decline, could be unsettling, market participants said. Those sorts of tumbles are far more frequent, with 564 such moves of that magnitude occurring in the Dow since 1901. The most recent slump of at least 2.5% was on June 24, 2016, when the Dow tumbled about 610 points, or 3.4%, a day after U.K. citizens voted to end the country’s membership in the EU. There were 3 falls for the Dow of at least 2.5% in 2015. Hogan said it is even hard to imagine what the landscape of the market would like in the face of a plunge of the same magnitude of the 1987 crash, when the Dow lost 22.6% of its value, or 508 points, in a single session. “That’s why it is hard for investors to think about it intuitively. We have no muscle memory for it. It’s hard to harken back to 30 years ago. We have been lulled to sleep,” he said.