The Zeitgeist – 3.20.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


As Fed Meeting Starts, Investors Appear Confident That Dovishness Will Continue [Forbes]

Jay Powell is our generation’s Arthur Burns.

The only difference is that Nixon did all of his bullying in private, and Burns wouldn’t dream of saying out loud what Powell shouts at every press conference.

They’re not even pretending anymore.


Fight chaos with constrained discretion [Salon]

If only we could make Congress more like the Fed, with a professional mandarin class exercising “constrained discretion”, whatever the hell that means.

Originally posted at the Niskanen Center, which is … disappointing. Classic example of admiring the problem, which is what institutionalized libertarianism has been institutionalized around (and is why I have zero interest in associating with institutionalized libertarianism).


I’m Not Letting Fear Affect My Outlook On Boeing [Seeking Alpha]

So I’m not going to rip this Seeking Alpha guy like I would noted raccoon and Boeing fanboy Kevin O’Leary, who just epitomizes everything that is laughable about financial media today. But I will say this, and hopefully these words wind their way to this guy’s “Dividend Growth Club”:

The absence of short interest in a name you like is NOT a good sign. On the contrary, it is a giant red flag that you have bought into a constructed and highly managed Narrative.


Lyft IPO Oversubscribed Ahead of Listing Next Week [Bloomberg]

Dah-dah-dah-dah-dah-dah-dah-dah-dum … or however you’re supposed to represent the Deliverance dueling banjos in Act I. Squealing like a pig comes in Act II.


TD Ameritrade Increases Commitment and Grows Capabilities for Stock Plan Services Through Its New Relationship with Certent [Press Release]

I’m seeing more and more of these partner relationship stories with back-office service providers like Certent and Carta and the like. Client acquisition costs … the struggle is real.


The Art of the Buzzer Beater: Why March Madness Magic Takes More Than One Shining Moment [SI]

Nah.

The post-hoc rationalization of lottery winners is a staple of sports writing, of course, and SI and ESPN are good places to practice your critical reading skills. And practice you should. Because this sort of inanity is even more prevalent in market writing.


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The Zeitgeist – 3.19.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


Major Equity Averages Recovered Last Week, But Challenges Remain [Forbes]

It’s Forbes contributor technical gobbledygook, so click at your own peril. But I admit, I was fascinated by the handy tool to choose-your-adventure on how to Tweet a link to the story. Little nudges everywhere. 


Profits Per Partner Hit $5 Million at Paul Weiss, Redefining Richest Tier [Law.com]

In case you don’t have a baseline for this kind of thing, $5M/Partner is…really good. But as headline-friendly as representing Tesla’s board would be, there’s gotta be more to the story to get to that kind of number for a firm with meaningful reliance on its fund formation practice…


CalPERS Moves Forward on Private Equity Revamp [Institutional Investor]


Ah. Well there you go.

Leave aside the windfalls for the Paul Weisses of the world for a moment. Yes, I rolled my eyes a bit at this whole PE episode, too. We (and many others) have been predicting this was the inevitable direction for many public pension plans for years. It’s frustrating that we’ve now reached this point – but nowhere near as irritating as the armchair CIOs on social media and traditional financial media ripping into the statement.

The right response for the staff of these funds isn’t derision, but empathy. It’s an almost intractable situation. They can’t force the state to take an axe to benefits. They can’t force the state to fund the plan with taxes. Most of them can’t even change their target rate, or the cost of living adjustment mechanics, without board and sometimes even legislative oversight. The consultants – risk transfer instruments for the board – are coming in hot and painting the staff into a corner with capital market projections that show both the magnitude of expected returns shortfalls and a light at the end of a tunnel that only passes through levered private markets investments and wishy-washy emerging markets overweights.

Like me, are you uncomfortable putting all the eggs of an increased risk-taking strategy in levered illiquid US small caps? Good. OK, let’s run through our alternatives:

Do you want to argue for layering on futures-based leverage in California? Cool. Yeah, we’re not going to let you take that kind of headline risk for us. You’re fired.

Do you want to argue for a public-only passive solution, trusting that returns will be enough? Cool. Yeah, our consultant’s telling us that would be imprudent. You’re fired.

Do you want to argue for a reduction in benefits? Whoa, stay in your lane. Also, you’re fired.

The railroading of public pensions into private equity is lamentable. It’s worth talking about. But let’s talk more about the things that are causing it – agency structures and a political unwillingness to talk about the inescapable interplay between return outcomes, benefits and tax outlays – and maybe a bit less about the staff forced into impossible situations.


Hemp, Inc. Subsidiary, The Hemp University, Announces its First West Coast, All Day Seminar in Ashland, Oregon [Business Insider]

LPT: Stick to sativa strains or else the afternoon is going to be a real drag.


Will 2019 Be the Year We All Start Renting Out Our Own Closets? [Vogue]

$250/Night, y’all, cash in advance.


Deutsche Bank and Commerzbank are finally merging – but critics worry about job cuts and patchy past deals [Business Insider]

“I really didn’t like his form on that Hail Mary pass, Tom. It’s almost like he just threw the ball up in the air and prayed that someone would catch it.”

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The Zeitgeist – 3.18.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


Three Bullish ESG Stocks This Week [Forbes]

Epsilon Theory’s unpopular opinion: ESG is not a thing.

Whatever word you use to call ESG a thing … “sector” (like this author), “asset class”, “factor”, whatever … you’re reifying a narrative. You’re making a narrative reflection of a bull market into a thing. Doesn’t mean that thing doesn’t have investable legs. Doesn’t mean that you can’t build a niche advisory business around it. Hell, look at EM. But there’s no there there. Sorry.

Also, a note on investment process (because I can’t help myself). The only words with informational content in this note are “I believe”. Once that’s stated, it is impossible for Buy recommendations NOT to exist. Which means that this is an investment tautology, not an investment process.


At Hedge Fund That Owns Trump Secrets, Clashes and Odd Bond Math [Bloomberg]

The sizzle here is Chatham’s ownership of The National Enquirer, but otherwise it’s a story of an old-school hedge fund. And to think I still get grief from people when I say that the only source of alpha is private information. I suppose these are people who have never traded a bond.


Millennials are the Fastest Growing Cohort Filing Insolvency (In Canada) [Canada Newswire]

Unlike ESG, however, usury IS a thing. JFC.


Lyft Announces Launch of Initial Public Offering [Press Release]

It’s pure inside baseball stuff, but I’m always fascinated by the teams of strange bedfellows that emerge around competing IPOs. Cue the dueling banjos from Deliverance.

It was a fun vacation for Burt Reynolds and the boys at the start of that movie.


A happy retirement is more than just money [CNBC]

The caption to this article photo reads, and I swear to god I am not making this up:

If you enjoy gardening, consider working part-time at a nursery a few years before leaving your job.

What is this “retirement” thing that people keep talking about? Does it still exist? I don’t think it does.


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The Zeitgeist Weekend Edition – 3.16.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories. On the weekend, we leave finance to cover the last week or so in other shifting parts of the Zeitgeist – namely, politics and culture. It’s not a list of best articles or articles we think are most interesting … often far from it.

But these are articles that have struck a chord in narrative world. 


Potential Excessive Testing at Scale: Biomarkers, Genomics, and Machine Learning [JAMA]

It’s closer to a journal article than news (no, not that journal), but clearly on-narrative with a lot of what we have been seeing on health care and pharmaceuticals pricing. The only difference is that in the case we’re talking about the aggregate influence of aggressive biomarker-driven testing.

The drumbeats around this topic are coming from every direction. There is no article published in the last week in any publication in our database that demonstrated as much connectivity among different topics and uses of language as this one. Some of that is subject-matter based – it covers scientific, economic, trade, health, social, behavioral and political matters – but that is the point. A high-attention narrative is often one which threads its way through a variety of topics.


FBI busts widespread college entrance exam cheating scheme that got athletes into elite schools [NBC]

Both Ben and I have rather a lot to say about this – because we think most observers are getting both the narrative effects and where we go from here wrong. Not just wrong, but 180 degrees wrong. Keep an eye out for new content on ET In Brief this weekend. 


Rahm Emanuel: Dems seem duped by Trump into reading ‘ready-made script’ for socialists [Washington Times]

Yep.

There is a lot of time until the election, but my sense – my opinion – is that a deepening of the widening gyre generally favors Trump.

Why? As that widening gyre drives the bi-modal peaks of our political distribution further apart, the appetite and demand for more extreme rhetoric and positioning will grow. I suspect the center-left candidates will poll well early, but discover quickly that sober ecumenism is not what primary voters are looking for after 3+ years of The Donald. You’d have to be deaf to miss the drumbeats of Inequality Narratives. They are the fuel that will accelerate the transition of democratic socialism into the mainstream of Democrat policy platforms. To some extent, they already have.

Redistributive policies, social program and schemes to reduce the power and influence of the wealthy will poll well individually. Strategists and advisers will convince themselves this means they can tell their candidates to boldly embrace them. But whatever people think about individual policies consistent with democratic socialism, a Socialism narrative is still poison in 2019.

Whatever you or I may think of it, a narrative of National Populism ain’t. 

Again, there is still a lot of time for all sorts of ridiculous things to take place that change the whole structure of this competition. But whatever you think about my opinions, recognize that Fiat News is already shaping yours (and mine). After Emanuel wrote these things in the Atlantic, here is the list of national publications who thought them newsworthy:

  • Fox News
  • Washington Times
  • USA Today

That’s it. When Fox and the Washington Times decide to cover this topic and a range of other publications don’t, you’re getting a message about how different media outlets want you to think – and what they want you to think about. Coverage biases are a huge part of Fiat News. More on this in the next installment of Road to Tannu Tuva. And in the next Zeitgeist story.


The Irish prime minister brought his boyfriend to meet Vice President Pence [Business Insider] / Lisa Page admitted Obama DOJ ordered stand-down on Clinton email prosecution, GOP rep says [FoxNews.com]

Alright, why the two-fer? What could these articles possibly have in common? Well, by a wide margin, they were the two articles from our dataset with the most social engagement over the last week. Dig in and you’ll find something even more interesting: ALL of the engagement is coming from news pieces – not opinion or analysis – deemed newsworthy by publications with one political persuasion.

Who published “Pence forced to meet gay Irish PM” pieces? Beyond BI, it was covered by the Washington Post, HuffPo, Daily Mail, The Guardian, Daily KOS, the BBC, the Hill, Daily Telegraph, most LGBT publications (e.g. Gay Times, Outmost) and just about every Irish publication.

Who published pieces referencing the Lisa Page testimony? Far more than Pence’s visit – after all, it was a formal hearing. But let’s look at the full list of articles published by four publications – all national, but two with a focus on Washington D.C. politics, and two with a more general political focus. Two with a progressive editorial perspective. Two with a conservative editorial perspective.

Fox News

Washington Examiner

Washington Post

CNN

If you’ve got a spare hour, read through this set of articles – it is a case study in all of the ways that Fiat News influences our understanding of the world. We are being told how to think more often than we are likely to recognize. We are influenced explicitly, through more subtle use of language, through the obfuscation of lines between news and analysis, and through editorial determinations of newsworthiness.

Worst of all, if it seems like the topics most sensitive to Fiat News are also the ones which make the social media rounds, you aren’t imagining things. They are.

There is very little that is more powerful to the individual interested in retaining their sovereignty than a willingness to listen to, tolerate and consider views that they may find distasteful. Full hearts means demanding our inherent right to freedom of speech, but putting our weight behind freedom of expression.


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The Zeitgeist – 3.15.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


A buzzy $3.2 billion startup that helps you get braces without seeing a dentist is planning to go public [Business Insider]

I thought we were finished with the “it’s like Warby Parker for X” business models, but I guess I was wrong.

So today I’m pleased to announce the launch of a kickstarter campaign for VaxDirectClub.

Why pay for an expensive healthcare professional and subject your children to god only knows what sort of germs in that waiting room when you can administer all of the standard immunizations from the convenience and safety of your own home? You owe it to your children to subscribe to VaxDirectClub today!

Also … this is the official SmileDirectClub founders photo. A great deal of effort and expense was put into this photo. There is nothing accidental or casual about it. It is a signifier of exactly how Alex and Jordan want to represent themselves to the world, all the way down to Alex’s careful coif and Jordan’s wan smile.


In Low Yield World, Global Investors Turn To Big Dividend Foreign Stocks [Forbes]

Because, you know, all of those crazy penny stocks and “new, speculative industries” are well known for their dividend yield.

You see this at the end of every cycle … value investors convince themselves that “value large-cap tech” is a thing, and yield investors convince themselves that “safe dividend EM financials” is a thing. Both are desperate measures for desperate times, and neither ends well.


House Dems to test Wilbur Ross’s ‘Survivor’ status [Politico]

In the same way that Rick Perry had no idea that the Dept. of Energy was in charge of nuclear weapon development until somebody told him, I would bet a large sum that Wilbur Ross had no idea that the Commerce Dept. was in charge of the census until somebody told him.

Trade your personal account on MNPI while Commerce Secretary? No problem. But allow a flunky to slip a bogus Trumpkin question into the census? Well now you’re in trouble, bub!

Whatever. Uncle Wilbur is this administration’s Albert Fall. You can look it up.


The ECB Has Reached The End Of Its Rope, Leaving The Eurozone With Few Options [Seeking Alpha]

Yeah, I know I posted this same photo yesterday. It’s evergreen. As are these earnest SeekingAlpha posts.


EMERGING MARKETS-Emerging market stocks, currencies jump on trade optimism [Reuters]

Emerging Markets are not a thing. You think they are, but they’re not.

EM as an asset class is a reflection of DM monetary policy, nothing more and nothing less.


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The Zeitgeist – 3.14.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


The Good and the Bad of Stanford’s Massively Successful Startup Scene [Bloomberg]

The self-dealing and shadow economy of prestige academia will all be Common Knowledge before this is all over, and it will rock our society more than any revelation of the self-dealing and shadow economy of Wall Street.


Cboe to Launch Suite of Derivatives-Based Strategy Benchmark and Volatility Indexes Based on MSCI Emerging Markets and EAFE Indexes [Press Release]

Welcome to the Hollow Market. JFC.


Democrats go to war with big everything [CNN]

If you think this is just a Sanders/Warren thing, or if you think it’s just a Google/Facebook thing, you’re wrong. This is a Zeitgeist thing.


No One Is Afraid of Slowing Growth at Momo [Fox Business]

It’s the triple play of raccoon financial media!

Fox Business “places content” from Motley Fool.

Motley Fool writes a puff piece on a Chinese “social video and online dating specialist” company called Momo (you can’t make this shit up).

But since a Chinese social video and online dating specialist called Momo just isn’t momentum-y enough, “investing geniuses” David and Tom Gardner want to sell you the 10 stocks that are – hard as this may be to believe – even better buys than Momo.


Welcome back, carried interest [Politico]

I’m just surprised capital gains treatment of carried interest has lasted this long.


China Puts Margin Financing Under Scrutiny As Stock Market Froth Evokes Memories Of 2015 Rout [The Street]

My new favorite euphemism! Now if you’ll excuse me, I must go deeply reflect on my Juicero investment.


Will The ‘Fed Put’ Work On The Next Go-Around? [Seeking Alpha]

Yes.


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The Zeitgeist – 3.13.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


What is fentanyl? [Washington Post]

An opioid crisis piece? Why did this rise to the top of a query of financial media articles? What’s the connection? This:

Yet municipalities still have trouble accessing the drug, partly because of the cost. Narcan, the commercial name for naloxone as a nasal spray, can cost between $70 to $150. But the injectable version, known as Evzio, can cost around $4,000.

If you haven’t heard it from someone else already, then hear it here: drug prices will be a platform pillar for every single candidate in the 2020 elections. In the same way that it even finds its way into discussions of the opioid crisis, it is attached in some way to all three of the components of the changing Zeitgeist we have written about – deflation to inflation, cooperative games to competitive games, and capital markets transformed into political utilities.

“Drug prices are too high in the U.S. and that has to change” is now common knowledge.

It will be interesting to observe whether the “We are subsidizing the world’s drug costs” narrative that Trump will promote will carry the day over the “We need to expand and reform drug insurance” narrative that Democrat candidates will offer.

And yes, this is a high-attention topic for pharma.


Some CRE Investors Switch Up Strategies as They Weigh Risk [National Real Estate Investor]

Oh, well that clears things up.

It reminds me of the old Mitch Hedberg bit: “People either love me or hate me…or they think I’m okay.”


What if All the World’s Economic Woes Are Part of the Same Problem? [New York Times]

Our first two-time Daily Zeitgeist article appearance.

This isn’t news coverage, so I wouldn’t apply the Fiat News label here, but it takes about 10 paragraphs before the author figures out that the story all the research is telling about productivity and corporate investment, etc. is about interest rates, a story that Ben has been telling for quite some time. It IS the New York Times, however, so before we get to that, we have to properly frame everything in terms of the very powerful narrative of inequality as the root cause of all society’s ills.

Ben and I don’t disagree on whether the economy would be more productive with more hundred thousandaires and millionaires and fewer billionaires. We do disagree a bit on whether allowing the state to participate in steering a society toward that outcome is a desirable or morally defensible way to achieve that. Where we do agree is that inequality can be both symptom and cause, but in practice is more symptom than cause. And the cause is fiat everythingFiat World.


Forget No Fees. ETF Breaks Ground by Offering to Pay Investors [Bloomberg]

OK, let’s leave aside the meta-game observation about saying the quiet part out loud.

  • Yes, the scheme is manipulative and kind of dumb.
  • Despite all that, yes, the scheme will probably work…at first.
  • No, it’s not vastly dumber than the amount of articles written about ETFs going from 5 to 2 bp, or from 2bp to free.

We have firmly established our enthusiasm for low-cost product. But that’s a preference in the real world. In narrative-world, we think the financial media obsession with complete, utter irrelevancies like a couple basis points does investors a disservice. It also leads to ink being spilled on nonsense like this.


Why We Like Rallies Led By Semiconductors: Jim Cramer [The Street]

As The Cramer likes to say, there’s always a bull market somewhere. The most persistent bull markets I know are advice markets based on unbridled optimism OR on unbridled pessimism … perma-bulls and perma-bears are always in demand. But the job security is better for unbridled optimism. Plus you avoid the Grumpy Grandpa audience, which can be a real drag.

The biggest advantage for the optimist advice market is that there’s a clear mechanism for getting paid. If you’re up, you’re up … there’s more money in the pot than there was before, and some of that can easily go to the cheering squad. If you’re down, though, even if you’re down less than you would have been otherwise … you’re still down. Investors are thankful for less bad losses. But they don’t pay for them. This is as true for the largest institutional investor as it is for the smallest personal account.

Get Report!


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The Zeitgeist – 3.12.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


Junk Bonds Are Winning Even When They’re Losing [Bloomberg]

Answer: the opposite of Climbing a Wall of Worry.

What is Descending a Slope of Hope? I’ll take Market Expectations for $800, Alex. (and yes, there’s an ET note on this).

[PS from Ben. I grew up watching Art Fleming’s Jeopardy with my dad on a black-and-white TV and it only took me 30 years to get used to this upstart Alex Trebek fellow … a Canadian to boot, I understand. You’re an immortal, Alex. And I’m not a praying sort of guy, but I hope you can feel the good will emanating from me and millions of others just like me, coming at you through the human ether.]


Trump says economy may be the ‘greatest in history.’ Let’s check the record. [Washington Post]

The power of the missionary in a widening gyre is built on the ability to polarize. On a practical level, one of the most effective tools of that polarization is the creation of hyperbolic cartoons. Whether it is the absurd Green New Deal spec sheet that AOC’s people put out there, or a Trumpian claim of “the greatest economy in history”, the point is to say the words and bring them into the Zeitgeist, knowing full well how everyone will respond.

The opposition will launch cringeworthy fact-checks. Supporters will say, “Come on, we all know what they meant. They’re directionally right, and that’s what matters.” Together both groups magnify common knowledge.

To control your cartoon you must embrace cartoonishness.

This is not the why, but it is the how of Trump’s success. AOC’s, too.


Sustainable finance grows in the world’s worst-polluting country [Bloomberg]

OK, answering this kind of question with a poll is…questionable (pause for groans), but another day, another ‘impact investing’ story at the top of the heap.

So IS there a change in the ESG/SRI Zeitgeist? Sorry, this is still a “Watch the News at 11 to find out” bit. Our answer is coming soon to ET Pro.


CalPERS scouting for general investment and alts consultants [P&I Online]

Biggest fish there is for most consultants, but I can tell you that most shops will only grudgingly fill out the RFP. Not just because incumbents usually win this kind of legally required rebid process, not just because of the level of competition, and not because there’s anything undesirable about working with CalPERS staff. Lot of lovely people there in my experience, actually.

It’s a tough RFP because you know going in that the clearing price will be well below the correct price for the employee time, aggravation and most of all, risk transfer that goes along with subjecting yourself to the layers of bureaucracy and conflicted oversight which attend a $300 billion+ plan in the most highly regulated state in our nation. The price for every bid is driven by a figurative DCF of the value of putting the logo on page 2 of your marketing deck.

It is sometimes hard to quantify the more subtle costs of heavy-handed regulation. This is one.


Neiman Marcus Creditor Group Counters ‘Devil’s Bargain’ Proposal [Bloomberg]

In my opinion, there is nothing – nothing! – more fascinating in the world of finance than a debt restructuring. And there is nothing – nothing! – more frustrating than having to watch it through media outlets which report just enough details to whet your appetite and not nearly enough to completely understand what’s going on. Oh, we can see the narrative shots fired (“Devil’s Bargain, indeed!”), and even more such bullets if we read the creditor group’s letter, which you should. It observes all the forms of the genre, up to and including accusing the board of ‘wanton disregard’, ‘putting a storied franchise and jobs at risk’, ‘self-serving’, ‘concocting schemes’, the whole shooting match. God, the only thing that would make it even better would be to conclude with…yep, they did it.

They signed it ‘respectfully.’


Invesco QQQ Celebrates 20 Years of Curating Innovation [Press Release]

When Invesco (then the awfully named AMVESCAP, for fear of insulting the AIM folks post-merger, I suppose) bought Powershares back in 2006, it was one of the first asset management M&A deals I worked on, and one of the few that ended well for just about everyone involved. QQQ was the crown jewel even then. Happy birthday!

But come on, y’all. Curating innovation? You’re managing a Nasdaq index fund, not launching a sea urchin-themed food truck in the Tenderloin. Especially if the first executive quote is going to be from…Dan Draper.

Image result for don draper shrugging

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The Zeitgeist – 3.11.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


You want your investments to make money and help the environment. Experts weigh in on whether you can [CNBC]

We have seen a lot of discussion about ESG/SRI in the last year. It feels like a lot, and it feels like it is more than before. And yet, it still seems as though all of the articles end with something like the quote above. All are evocative of this idea that we are riding a massive, unavoidable wave, and any minute now it’s going to transform the way we invest. If you already buy into ESG/SRI, emerging common knowledge that certain of these techniques ARE how everyone knows that everyone knows you invest responsibly and ethically doesn’t change much. If you’re ambivalent about ESG/SRI, on the other hand, that kind of sea change could exert heavy influence on regulators, clients, stakeholders, boards and other constituencies with a vested interest in how you invest.

So is there a change in the narrative and common knowledge about ESG/SRI? Sorry to tease (no, I’m not), but we’ll be publishing our answer to exactly this question in ET Pro in the next couple days.


Hedge funds continue comeback from 2018 [HedgeWeek]

Good job, good effort.

For a minute there I was worried that it might just have been equity beta. Quite a relief, really.


Ruined property tycoon, 63, goes on a hunger strike against bank for £10million ‘mis-sold’ loan after being evicted and made bankrupt [The Daily Mail]

There is…a lot going on here. But most of all, this is the most Britain headline that ever Britained.


Boeing shares down 10 percent after second crash involving 737 MAX 8 [Reuters]

Given the overall business mix at Boeing, does a 10% initial move on this news seem big? It shouldn’t. Here’s an excerpt from our comments on Boeing in an ET Pro note back in January:

The existence of narratives matters. The absence of cohesive narratives matter too. No one without private information about the 737 MAX 8’s design could have reasonably predicted the odds of these accidents. But in our opinion, a Boeing with a ‘strong defense spending’ or ‘trade deal winner’ narrative is a bit more robust to this kind of adverse event risk. In 2019, CEOs must control their cartoon or have it controlled for them – by the media, by politicians, by competitors or by events.


Time is running out for Greek NPLs [Euromoney]

Coming to an institutional pitchbook near you, it’s the 2019 Nplpalooza! Get excited!

I don’t know the answer to this question, but I feel confident it is probably >200-300bps less than the average response I would get if I put it to a poll.

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The Zeitgeist Weekend Edition – 3.9.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories. On the weekend, we leave finance to cover the last week or so in other shifting parts of the Zeitgeist – namely, politics and culture. It’s not a list of best articles or articles we think are most interesting … often far from it.

But these are articles that have struck a chord in narrative world. 


The Oppression of the Supermajority [New York Times]

This is an opinion piece, so it isn’t Fiat News per se; still, I hope that you have become aware enough in your content consumption practices to spot attempts to steer facts in a direction that is convenient for the author. This is an especially fascinating attempt, given that it seeks to diminish the existence of polarization on the basis of poll responses that would seem to imply that we all agree on rather a lot.

No kidding!

The argument is facile for several reasons. The first is that the primary evidence for the claim on which the entire piece hinges is an arbitrary and cherry-picked list of polls on policy opinions. The second is that those polls are terrible. Tell me whether you want me to prove that a ‘supermajority’ supports or opposes greater restrictions on abortion, for example, and I’ll get you the questions to make the polls sing whatever tune you prefer. The third is that the argument that polarization is the leading political issue of our time isn’t really based on strong fundamental differences in major policy opinions. It is based on the observation that we align ourselves increasingly with identity-based poles with dynamic and shifting underlying links to policy. Are we to deny that Trump is a polarizing figure simply because polls from three years ago would tell us that free trade and support for NATO were really popular among self-described conservatives? C’mon.

The main contention – that our policymakers don’t focus on issues that matter to people – is very obviously true. But the reason for it – that the shifting Zeitgeist from cooperative to competitive makes it far more politically expedient (fundraising, notoriety, support) to focus on the fault lines of identity and division – is equally obvious. The polarized abstractions of the widening gyre are the root problem, and poor governance is the outcome.

Not the other way around.


Risks And Rewards: From Rome To Manhattan [Global Finance]

Can’t escape some finance, apparently, even on the weekend.

My first temptation was to just roll my eyes and move on. My second temptation was to poke fun at the milquetoasty goodness here. Too cynical. Sure, Digitization with a human touch is a familiar death rattle of bankers the world over that have no earthly idea how they’re going to reach a skeptical, underbanked generation while keeping something akin to their current margins.

But the second bit, the tailored investment offerings? That’s a portion of how you actually do the first thing that most financial services firms are waving their hands at. But it won’t happen through product. Look, if your company’s name doesn’t rhyme with Schmanguard or Schmackrock, the profitability of your public markets asset management business is going to keep tanking for a very long time. Trading? Same, although most of that damage has already been done. There’s some market for less liquid, less scalable strategies, sure, but at industry scale, the market is screaming at all of us: Be in the business of advice or die slowly.

Am I saying that financial advice is immune to disruption? Yeah, actually, that’s pretty much what I’m saying. Spare me the “actually, our digital advisory platform is really making inroads with…” stuff. When it comes to the biggest pool of wealthy families globally, human advisers aren’t going anywhere.


Commentary: Concrete Steps Can Strengthen U.S. Democratic Institutions [US News]

OK, I’m sure this is all fine.

But let’s be real: the But our Democratic Institutions! meme is just too good for both political poles. It’s a familiar charade. The political left stands in a circle beating their chests about the electoral college. Someone writes an article having discovered some magical way to make it go away. And they legitimately, seriously pretend that anything will ever happen to it. The political right stamps around in a circle about unregistered voters and imaginary widespread voter fraud, miserable at how they are subverting the legitimacy of our elections. The media jumps into the fray by happily conflating social media-based influence by agents of foreign powers with “manipulation of elections” to fire up both.

I’m sure the Secure Elections Act is just dandy policy. But as long as But Our Democratic Institutions! remains such an effective obedience collar, the vilification of those institutions will continue.


With mortgage rates rising, more homeowners are opting to remodel instead of move [Dallas Morning News]

Huh. It’s almost like…nah.


Something is seriously wrong with Trump [Salon]

OK, the CPAC speech was really weird.

But y’all: Right-wing truthers tracking Hillary’s every cough, determining how much of her body weight was being supported by security personnel after an apparent fainting episode is weird, too. Left-wing podcasters emphasizing they are not a mental health professional before engaging in a dozen paragraphs of armchair mental health diagnosis of Trump is weird, too.

This health fixation is an unsettling feature of the widening gyre. We cannot fathom that The Other could be smart, decent, thoughtful, un-evil or even mostly healthy. It’s certainly possible that they aren’t, but it takes a force of will to convince ourselves to even consider the alternative.

Wait, scratch that. None of this is really happening. Didn’t you know that 60% of Americans agree on privacy laws?


Graphic Novels in the Age of Trump [New York Times]

I really should have saved this one for Ben. He’s the kind of guy who cherishes graphic novels, while I’m the kind of guy who buys a Flash t-shirt at Marshalls because it’s $8, and stares blankly at the bartender when he asks me, “What’ll you have, Mr. Allen?”

But this poignant observation of the shift between the older online serialization and the later published book hit me this morning. There is a slow seep of humanity that runs out of us as we circle in the widening gyre. Something worth thinking about this weekend.

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The Zeitgeist – 3.8.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.

I’m channeling my inner MST3K with the comments here. Premium subscribers should feel free to join me in the Comments section (but only if you know what MST3K is!), and I’ll reprint the best ones in an upcoming Mailbag note.


Norway Gives Wealth Fund Approval to Cut Some Oil [Bloomberg]

The narratives around climate change and socially responsible investing are powerful ones. Why? Because they are presented as existential. They matter for the same reason that attaching the national security! meme to trade negotiations instantly took their importance up a notch. What is interesting about this issue in particular, however, is just how malleable the underlying approach to leveraging the narrative can be so long as you say the magic words. This climate-motivated change in Norway – more than two years in the making! – ended up justifying keeping the huge positions in integrated oil companies because they were more likely to be a part of climate solutions. I’m on record saying I think that actually is true, but do you have any doubts that they could have justified practically any interpretation as long as the forms were observed?

A lot of people believe in investing in big shifts – mega-trends, super-themes, whatever – because they think that issues like climate change create big, unpredictable changes and inflection points. Most of these people underestimate, however, how powerfully entrenched forces can use the language and taxonomy of those change narratives to protect the status quo.


Where does the endowment money go?; $44 billion K-12 endowment sends less to schools than decades ago [Houston Chronicle]

We’ve written a lot about Gell-Mann Amnesia, the phenomenon in which you read about a topic you understand in the newspaper and shake your head in disgust at how poorly the authors understood the details, but then blithely turn the page and nod along to some other specialized topic you know less intimately. Stories about big, public investing institutions are my #1 Gell-Mann Amnesia trigger.

A regional investigative journalist can be forgiven for not completely understanding why comparing returns on a pool of real assets and royalties with a bizarre legislature-imposed mandate to the Yale University Endowment makes zero sense. A professor at Johns Hopkins University, however, has no such excuse. Good grief.


Boat Race Bank BNY Mellon Could Face Landmark Legal Fight After It Bans Staff From Working at Home [Evening Standard (UK)]

Well, that didn’t last long.

Separately, Britons, please advise: What the devil is a Boat Race Bank?


The Gazillion-Dollar Standoff Over Two High-Frequency Trading Towers [Bloomberg]

Ever since I saw the documentary about Disney’s highly secretive landgrabs under a range of oddly named development companies to build Disney World, my brain has started to auto-tune any story of up-and-coming entities staking out surprisingly aggressive positions. I was about two lines into this one when I decided, “Nice. These guys are just Citadel.” It wasn’t until later in the piece that I realized I wasn’t alone.

Part of the kick-in-the-teeth of writing so much about narrative is that you really do see it everywhere. The other part is the response to that: You fight the pattern-recognition impulses that usually do serve you well.


Chinese Shares Suffer Worst Day in Five Months as Exports Slump [Morningstar]

It is de rigeur for us and others to take on the tiresome “Markets [slump/rally/dive/soar] as [event]” takes from financial media, analysts and other commentators, but sometimes someone still manages to say something so vague and hand-wavy that, while we recognize they’re trying their hand at missionary work, we can’t quite figure out what view they’re promoting.


Real Estate Home News: Last Blockbuster Store & Last Blockbuster Mansion [Press Release]

Wait, wait, wait. The Last Blockbuster is real?


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The Zeitgeist – 3.7.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.

I’m channeling my inner MST3K with the comments here. Premium subscribers should feel free to join me in the Comments section (but only if you know what MST3K is!), and I’ll reprint the best ones in an upcoming Mailbag note.


Billions Are Headed to One Market. You Can Get There First [Nasdaq.com]

Four or five times a week, I’ll get an email from someone asking if they can place an “article” on Epsilon Theory. Sometimes it’s about something vaguely finance related, sometimes it’s not (a buying guide to survival knives is still my personal fave of proposed topics). Back in the day, almost all of these emails “offered” these articles as free for me to publish, because obviously they were doing me a favor by giving me “content” to put on the website. As ET has grown in reputation (?) or maybe just because we’ve been around long enough, I don’t get many emails offering free content anymore, but just directly asking for my rate to publish sponsored content. Not ads, mind you, which I’m happy to quote you a rate for, but for “articles” on such and such topic written by one of their clients.

My response is always the same. If Ken Fisher would rather die and go to hell than sell you an annuity, I’d rather die and go to hell than publish a bullshit “article” that someone paid me to flog. It’s not just a personal preference. It’s a smarter business model.

Every self-professed “financial media” website I read today publishes sponsored content masquerading as legit content. As a result, they have all become platforms for raccoons. All of them, including the biggest brand names in our business … Bloomberg, Forbes, Nasdaq, CNBC, you name it. ALL OF THEM now have websites that are infested by raccoons. It’s the most penny-wise and pound-foolish thing they could possibly do, but god knows we live in a profoundly penny-wise and pound-foolish world. It destroys their credibility and authenticity, which destroys the quality and engagement of their online readership, which destroys their CPM rates … it’s all a vicious cycle which is killing has killed the business model of these media sites.

So thank you, Forbes. Thank you, Bloomberg. Thank you, Nasdaq. Thank you, CNBC. Thanks for destroying your online media businesses and donating your audience to us. We really couldn’t do it without you.


Deputy SNP leader says new Scottish independence vote could happen without UK blessing [Nasdaq.com]

California has wrestled with what I’ll call “the referendum problem” for decades. The UK, of course, has been knocked politically flat by this, as has Spain. And it’s coming to the US, too, in the form of “electoral college reform” to make our one national vote “more democratic”. It’s part of the widening gyre. It’s part of the shift in the Zeitgeist. Everyone can gnash their teeth and wring their hands if you like, but it won’t stop this.

What, you’re opposed to democracy?


US Govt not willing to go on ‘international fishing expedition’ for evidence in spoofing case [FinanceFeeds]

If I were a betting man (and I am), I’d be willing to place a large wager that the judge here will deny the defendant’s discovery request for information collected by US and UK market regulatory bodies. It’s all part and parcel of the phenomenal growth in the surveillance capabilities of market regulators, combined with the presumption of guilt if you outperform a market.

And of course I think Sarao and Thakkar are outright raccoons who deserve to have the book thrown at them. But when it comes to the Surveillance State, everyone who says “if you have nothing to hide, then you have nothing to worry about” is either a fool or a stooge. Probably both.


Amid Volatility, Advisers Report Ongoing Client Equity Focus [planadviser]

Another version of sponsored content here, but that’s not my point. I think what investors are going to “wake up to” over the next few years is the portfolio PENALTY from fixed income investing.


Howard Marks: The Paradox of Risk [gurufocus.com]

I’ll start by making the required genuflection to Howard Marks as a great investor. Yes, so stipulated. Seriously.

But there is zero functional or linguistic difference between a religious seminary and these sites that recite and interpret the Value Canon, and it drives me nuts.

Risk defined as volatility is the worst definition of risk … except for all the others. Defining risk as potential for (permanent) loss is a meaningless tautology, useful only to the Faithful.


The Market Gapitalization [Phil’s Stockworld]

This article is by Michael Batnick, riffing on an exhibit in the Credit Suisse global investment yearbook. It’s a good example of what makes Batnick a long-time Epsilon Theory fave, because he gets right at the heart of what’s interesting in the long-term DM vs. EM chart – World War II.

Everything you think you know about investing – EVERYTHING – is because the United States won World War II.

I don’t think we’re going to have another World War. I really don’t. But a change in the Zeitgeist can have the same functional impact as a World War. And I really DO think that’s happening.


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The Zeitgeist | 3.6.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.

I’m channeling my inner MST3K with the comments here. Premium subscribers should feel free to join me in the Comments section (but only if you know what MST3K is!), and I’ll reprint the best ones in an upcoming Mailbag note.


UK’s May courts support for Brexit deal with workers’ rights offer [Nasdaq.com]

Brexit really doesn’t get my spidey-sense tingling. It’s a garden-variety deflationary shock for global equity markets, exactly the sort of thing that the entire arsenal of central bank firepower accumulated since 2009 was designed to defend. Brexit is a classic brick in the wall-of-worry that markets must have to climb higher.

I mean, when Neel freakin’ Kashkari is using Brexit as a “reason” for the Fed to be “patient” and MORE accommodative … nuff said.

What DOES interest me is the political gamesmanship around whatever happens here, which is what this article is talking about — Theresa May’s efforts to pick off a few Labour MPs by promising some sort of “workers’ rights” deal. Seems unlikely on the surface, which makes me think that May is already looking ahead to general elections and is using this as part of a larger Tory v. Labour metagame. Everyone seems to have concluded throughout this entire Brexit fiasco that May is an idiot. She’s not.


Healthcare stocks slide amid ‘Medicare-for-all’ proposal, Cohen hearing [S&P Global]

I see this all the time in the nexus between market-world and narrative-world … people who are immersed in a particular area of market-world, like a sell-side healthcare analyst, are almost always surprised by the market reaction to a policy announcement or initiative that “we knew was coming.”

THIS is the Common Knowledge Game in action. It’s not what you know about what’s coming down the pike that moves markets. It’s not what everyone knows (the consensus) that moves markets. It’s what everyone knows that everyone knows that moves markets. And that everyone-knows-that-everyone-knows knowledge formation occurs if and only if a Missionary makes that statement through a media megaphone.

Who’s a Missionary? A group of House Dems announcing a Medicare-for-all bill (M4A, as the cool kids would say) bill. Not a BMO healthcare analyst.

But therein lies the opportunity.


Jim Cramer Explains How Short Sellers Manipulate Stocks – Like Tesla (TSLA) [Cleantechnica]

So this article was written by one of Elon’s fanboys, not by Jim Cramer. It’s taking one of Cramer’s MANY video “explanations” of how those darn shortsellers attack an innocent stock, and repurposing it for the excuse du jour on “why” TSLA has had a bad week.

The constant Cramer shtick on “market manipulation” by “algos” or “shortsellers”, which has been going on for YEARS, is just too tiresome to address at length here. Plus, of course, there’s an Epsilon Theory note for that! It’s an oldie-but-goodie that I’ll have to dust off and revise sometime soon, but it still reads awfully fresh – Wherefore Art Thou, Marcus Welby?

As for TSLA … I realize that I don’t have a sociology background, so take this for what you will, but what’s happening is a classic shift from Growth! to Value? in both the stock and the narrative. This will not be a fun ride for the Elon fanboys. And yes, they’re all boys.


China cuts taxes, sees ‘tough struggle’ as growth slows [Breitbart]

The market narrative on Chinese economic stats is interesting to me. We’ve gone from private knowledge that their statistics are politically constructed to consensus knowledge that their statistics are politically constructed to common knowledge that their statistics are politically constructed. And yes, I’m thinking that there’s an opportunity there, too.

Also, I can’t help but do a doubletake on the word “unleash” here. Some of us are old enough to remember when the US was threatening to “unleash” Chiang Kai-Shek.

Also, I ask myself why Breitbart is publishing a “straight” China economy piece. You should ask yourself that, too.


Fed hints at holding off interest-rate hikes until summer [The Bulletin (Bend, Oregon)]

I like to read articles from regional newspapers to get a rough sense of common knowledge on monetary policy. The Fed’s highly intentional and coordinated strategy to use their communications to shape investor behavior and beliefs is the most successful marketing campaign of the past decade.


Why is there an alternative ESG fund drought? [Citywire]

Coming soon to a pension fund public hearing near you. It’s no longer enough to have a long-only ESG mandate. It’s no longer enough to avoid companies that don’t meet your environmental or social or governmental mandate, whatever that mandate means to you. No, no … we need to allocate to alternative ESG funds (i.e. ESG hedge funds) that will actively short “unethical stocks”.

JFC.


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The Zeitgeist | 3.5.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.

I’m channeling my inner MST3K with the comments here. Premium subscribers should feel free to join me in the Comments section (but only if you know what MST3K is!), and I’ll reprint the best ones in an upcoming Mailbag note.


Oil Extends Gains on Bets Linked to US-China Trade, OPEC Production Cut Reports [The Street]

I thought the larger screen shot here was kinda perfect, with Cramer’s “Investment Club” ad and not just one, but two Ameritrade ads. I also loved the headline use of the word “Bets”.

Frankly, this is the brilliance of the the Robin Hood UI (or UX, as the cool kids would say) … they don’t pretend that what they’re selling is anything other than a legalized gambling experience. The Street still wants to pretend. Dopamine is a helluva drug.


Traditional and Alternative Value Opportunities in Housing Stocks [Wealthmanagement.com]

Want to make your infomercial stand out? Use the word “Value” or “Growth” in the title, and then sprinkle the rest of your “content” with the vocabulary of these distinct investor languages. Then for your hook, take a price chart of the past few months and find another year where the chart looks kinda like that. Don’t worry if it’s not a great eyeball fit, because no one will actually look up the comparison.

God knows I rail on and on about the power of Fiat News – the presentation of opinion as fact – as the bane of our political lives. But the more profound damage of Fiat News is in the hum-drum quotidian hours of our everyday lives, where there is no respite – NONE – from being sold on something by somebody. We are hardwired to respond positively to statements of “fact”, and everyone with a megaphone or an ad budget knows it.


European markets seen lower as politics take centre stage [CNBC]

Classic wall-of-worry narrative construction … create “concerns” and lead with a “warning”, so that the working day can be driven by a story arc of “overcoming” and “seeing through”.

It’s a Hero’s Journey, after all, and you watch because you, too, can be that hero.


Greece to Sell 10-Year Bonds for First Time Since Before Bailout [Bloomberg]

There’s a wonderful book to be written about Alexis Tsipras one day, the Socialist “man of the people” who gets beaten down by Merkel to the point where he’s reduced to touting 10-year bond sales as the cornerstone achievement of his administration.


What if All the World’s Economic Woes Are Part of the Same Problem? [New York Times]

I agree with the upshot of this opinion piece in the NYT. But here’s the thing …

Notice the passive voice.

Wealth inequality and low interest rates don’t just “happen”.

Wealth inequality and low interest rates are the explicit and intended consequences of Team Elite monetary policy over the past DECADE.

And until our arbiters of Fiat News wrestle with THAT, they will continue to be “shocked” by the political gains of “populists” on both the Left AND the Right who instinctively do get THAT.

FFS.


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The Zeitgeist | 3.4.2019

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Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.

Rusty and I like to comment or snark on these articles with each other, MST3K-style, so we’re publishing that, too. If you want to channel your inner Crow T. Robot or Tom Servo, feel free to join us in the Comments section!


Restricting Stock Buybacks Will Hurt the Economy [NY Times]

A big part of legal strategy is venue shopping – finding the most advantageous set of courts and judges for your particular interests. This is no less true in narrative strategy, although it’s often more advantageous to go against type (liberal views published in WSJ op-ed, conservative views published in NYT op-ed). That’s because informational impact is measured by how much a piece of text changes people’s minds, not its echo-chamber effect, and you’ve got a better chance of doing that when you’re not preaching to the choir. Of course, you’ve got balance that against the willingness of the non-choir media platform to run your (to them) crackpot views. What’s interesting to me is not that there’s a very public op-ed debate over stock buybacks, but that the protagonists are choosing the NY Times as the venue.


Flamboyant billionaire who counts Donald Trump as a friend is lurking in the shadows at Regal Petroleum  [ThisIsMoney.co.uk]

If you haven’t yet seen What We Do In the Shadows, it’s really quite good.

“Vampire housemates try to cope with the complexities of modern life and show a newly turned hipster some of the perks of being undead.”

Somehow I think Victor Pinchuk (and probably the “reporter” of this article) would feel right at home.


How Off-Grid Energy Access Is Shaping The Energy Transition [Forbes]

Honestly, when I see “Forbes contributor” as a line item in someone’s bio, it’s an immediate red flag for me. Might as well scream “I write infomercials for a living.”


States consider asset transfers as way to shore up plan funding [Pensions & Investments]

We tend to see state-backed pension funds as somehow separate from either the P&L or the balance sheet of the state government, when in truth they are one and the same. Yes, we will see a lot more of these balance sheet transfers going forward. The problem, of course, is that you can’t really sell these government-owned assets, not in the modern Zeitgeist of anti-privatization and anti-austerity. So it’s definitely a funny-money support for pension fund obligations, but we live in a permanently funny-money world.


Aggregate Demand: Definition, Formula and Why It’s Important in 2019 [The Street]

I expect we’ll see a lot more of these primer articles on economic theory heading into the 2020 election. The last time economic theory was front and center in a presidential election was supply side economics and Ronald Reagan in 1980. Expect the same with Modern Monetary Theory and the Democratic primary and national candidate today. And yes, there’s an ET note for that.


Apollo sub Redding Ridge issues first euro CLO [Global Capital]

I mean … of course they are. I gotta tell you, though, my spidey-sense is not tingling about this stuff yet. Is it too much money deperately searching for yield? Absolutely. Is it a systemic risk? I just don’t think we’re going to run the same gag twice.


US STOCKS-Futures up on growing hopes of U.S.-China trade deal [Reuters]

US-China trade talks are the new Risk-On / Risk-Off. And yes, there’s an ET note on this.



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The Zeitgeist | 3.1.2019

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This is our feature of the 10 (or so) most on-narrative (i.e. interconnected, highly similar) stories in financial media. It’s not a list of best articles, or articles we think are most interesting, or articles we agree with. But if you’re going to read 5-10 stories when you start your day, these are the ones that are most connected to the financial news that got published today.

Why Americans pay $550 monthly for new cars

China tech: Playing BATs versus FAANGs

Big Pharma’s Hunt for New Drugs Is Pushing Up Cost of Deals (Ed Note: Maybe they should just do buybacks instead to avoid controversy.)

Evolving The Advisor-Client Relationship

Trade Against Pension Fund Constraints For Better Returns

Chart of the Week: Institutions pump money into ETFs

J.C. Penney plans to close 24 more stores

Fleet Complete Finalizes Investment Partnership with Ontario Teachers

Ireland Factory Growth Improves In February

‘One Day at a Time’ – Gloria Calderon Kellett on being the boss and the Netflix numbers game

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The Zeitgeist | 2.28.2019

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This is our feature of the 10 (or so) most on-narrative (i.e. interconnected, highly similar) stories in financial media. It’s not a list of best articles, or articles we think are most interesting, or articles we agree with. But if you’re going to read 5-10 stories when you start your day, these are the ones that are most connected to the financial news that got published today.

Report: Blockchain Home Equity Loan Platform Raises $65 Million

UK house price growth ‘subdued’ as Brexit looms

Why Nintendo keeps returning to classics like Pokemon

MYSTERY SHOPPER BRISTOL; The shopper is considering investing her graduation gift – £50,000 – in safe haven assets such as gold

Doubts Over Trade Talks Weigh on Stocks (Ed Note: We haven’t seen “weigh on” in a while.)

The Perils Of Investing Idol Worship: The Kraft Heinz Lessons!

Deutsche Bank Shares Slip Lower After ECB Capital Increase Notice

Chinese Stocks Are Suddenly the World’s Best Trade in February

Trump-Kim summit fizzles; AB InBev surges; US GDP

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The Zeitgeist | 2.27.2019

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This is our feature of the 10 (or so) most on-narrative (i.e. interconnected, highly similar) stories in financial media. It’s not a list of best articles, or articles we think are most interesting, or articles we agree with. But if you’re going to read 5-10 stories when you start your day, these are the ones that are most connected to the financial news that got published today.

How To Build A World Full Of Elons (Ed Note: I’ll take ‘Questions nobody is asking for $400, Alex’)

Alaska Permanent allocates $1.6 billion in commitments, investments

Tech stocks: is the foldable, 5G and AI era really revolutionary

GE just spun off its locomotive unit. Workers immediately went on strike

AutoZone Rises Sharply After Beating Earnings Estimates

Asian Shares Rise On Dovish Fed Comments

Elon Musk’s SEC fight: Here’s what could happen next

Dow futures point to lower open ahead of Trump-Kim summit

Low Participation Levels Keep The Bull Alive

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The Zeitgeist | 2.26.2019

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This is our feature of the 10 (or so) most on-narrative (i.e. interconnected, highly similar) stories in financial media. It’s not a list of best articles, or articles we think are most interesting, or articles we agree with. But if you’re going to read 5-10 stories when you start your day, these are the ones that are most connected to the financial news that got published today.

Intel and Apple Among Stocks Set to Gain on Improving U.S.-China Relations

Stealing The Permian – Which Operators Are Next In Line For U.S. Onshore Mergers And Acquisitions Activity?

Barrick Gold’s Shocking Hostile Bid For Newmont Is A Lowball Offer

Hearings on ‘sky-high’ drug prices show how little has changed in 60 years

The Current Cost of Climate Change: $650 Billion and Rising

Rally in Cyclical Stocks Could Be a False Positive

SE Asia Stocks-Most fall on trade deal uncertainty

Aussie, NZ shares end lower as markets seek clarity on Sino-U.S. talks (Ed Note: Markets ‘seek clarity’! What a cool thing to be able to determine.)

Kraft Tests Buffett and 3G Ties — WSJ

A Stock That Rides Every China Bubble Returns Stronger Than Ever

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The Zeitgeist | 2.25.2019

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This is our feature of the 10 (or so) most on-narrative (i.e. interconnected, highly similar) stories in financial media. It’s not a list of best articles, or articles we think are most interesting, or articles we agree with. But if you’re going to read 5-10 stories when you start your day, these are the ones that are most connected to the financial news that got published today.

As AI Software Replaces Thousands of Workers, One Company Will Benefit the Most

Are you paying higher fees to subsidise tiny ‘orphan’ funds?

How America Learned to Stop Worrying and Love Deficits and Debt

The Green New Deal: A Fresh Opportunity For Investors?

Stocks Gain, China Surges, as Trump Delays Tariffs Amid Trade Talk Progress (Ed Note: It’s a rare threefer – Gain! Surge! Progress!)

Trump predicts ‘very big news’ in China trade talks after breakthrough

Trump Extends China Tariff Deadline

Buffett’s Berkshire, hurt by Kraft Heinz, posts massive quarterly loss


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