The Zeitgeist – 5.22.2019

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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.


May 22, 2019 Narrative Map – US Equities

Source: Quid, Epsilon Theory

Go Wide, Not Deep [Morningstar]

We think core menus should be wide, not deep—that is, menus should offer exposure to a wider array of investments but not multiple options for the same asset class (with the potential exception of an active and passive option). The idea is to offer a range of investments that will better help participants achieve their retirement goals. We think it’s important to give participants access to funds with unique risk characteristics so they can supplement allocations in their other accounts (such as an IRA) as well as give a financial advisor (who is not associated with the plan) the ability to design a portfolio inside the plan. These funds can also be used by in-plan advice providers, such as managed accounts, to build better portfolios.

Retirement plan menus are ground zero for what is delightfully referred to as “choice architecture” … steering and nudging you into making the “right” choice.

If you don’t like what’s being said, change the conversation.
― Don Draper

Ad men understand “choice architecture”. It’s not called the Wheel. It’s called the Carousel.

I’ll make him an offer he can’t refuse.
― Vito Corleone

Mob bosses understand “choice architecture”. An offer you can’t refuse is what game theorists call a Hobson’s Choice, part of a more general class of games that includes ultimatums and dilemmas.

Like all ad men and mob bosses, Morningstar is in the choice architecture business.

And yes, there’s an Epsilon Theory note for that:


Analysts Make Research Cooler, Wonkier and Bespoke to Lure Cash [Bloomberg]

As the industry wrestles with the problem of making money on its own, the stage is set for podcasts and novella-length thematic analyses.

Yes, please.

“Luring cash” … FFS, people.


Quality corn stover in high demand [Hay and Storage]

I went back down through the line and took a closer look at the corn stover quality in the back row that had not sold yet. One load in particular caught my eye. After confirming there was no mustiness, mold, or mildew on the crinkled corn husks, I asked Eric Motter of Myerstown to share how he produced his 7,500-pound load of 3×3 bales weighing a little over 500 pounds each.

He planted the third week of May and the Roundup Ready hybrid only received manure. I could clearly see the corn held its color until harvest and it yielded well. No foliar fungicide was applied.

I have no idea why an article from Hay and Storage was linked so centrally to financial media, but I am so happy that it is!

Of course, I actually DO have an idea why farm esoterica is a central narrative in financial media today, as farmers are the casualties of this trade war.

It’s not just the corn crop that has only received manure this season.


US stocks have crushed their European peers by 76% over the past decade. Here’s what Goldman Sachs says needs to happen for Europe to flip the script. [Business Insider]

Saved you a click.


Global markets are rallying after Trump tempers his Huawei ban after ‘big reality check’ [Business Insider]

US, European, and Asian stocks rose on Tuesday after Trump tempered his Huawei ban.

The Chinese telecoms giant can buy US products to maintain its networks and release software updates, but it can’t buy American components for new devices.

“This latest move by Trump shows just how haphazard his policies are and also how pervasive Huawei goods and technology are,” said Jasper Lawler, head of research at London Capital Group.

This was the actual graphic associated with this Business Insider “article”. It’s a stock photo from Getty, and I suppose it’s what you get when you search for “Yay, Huawei!”.

And then there’s the obligatory anti-Trump commentary from some London dude, criticizing the “haphazardness” of US policy. As always, there’s no parody like self-parody.


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The Daily Zeitgeist

Democracy Dies with Dancing

By Rusty Guinn | June 18, 2019 | 0 Comments

There’s a critical, indispensable feature of a free nation we call a free press. And then there’s the meme of free press!. The latter is a pure narrative construction, and a thing well supplied in the DC market.

Read more

The Not-So-Much War

By Rusty Guinn | June 17, 2019 | 0 Comments

A tug-of-war is only a tug-of-war if both sides, y’know, are capable of pulling on the rope.

Read more

Zeitgeist Narrative Map – 6.14.2019

By Rusty Guinn | June 14, 2019 | 1 Comment

1+ 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 this is the map that …

Read moreZeitgeist Narrative Map – 6.14.2019


Victims of Success

By Rusty Guinn | June 14, 2019 | 0 Comments

If you’re going to trade on story and sentiment, more power to you. But over time, the mind naturally searches for justification and credibility for continued ownership of something. Take care when you start to feel that pull.

Read more

Live from Potemkin

By Rusty Guinn | June 14, 2019 | 0 Comments

Sometimes a news article that’s all over the map is just a badly written article. Sometimes it’s like a glitch in the matrix. I think the changing narratives and weakening common knowledge around Big Tech are causing the latter.

Read more

The Most Valuable Commodity I Know

By Ben Hunt | June 13, 2019 | 0 Comments

What’s the most valuable commodity Gordon Gekko knows? Information.

How valuable is Wall Street research? How much information does Wall Street research have? LOL.

MIFID II is making the jump from Europe to the US. Time to polish those sell-side research resumes. As if you weren’t already.

Read more

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Peter Perez
Member
Peter Perez

Ben…the connection is glyphosate (er…Round-up weed killer) as a pre-harvest desiccant… https://en.wikipedia.org/wiki/Crop_desiccation the same crap that Bayer just lost its butt over. AND we’ve been ingesting this carcinogen thru eating wheat and other grains. Whole wheat (er whole glyphosate) anyone? Bayer is a financial story…Round-up the connection to the story above. Haul-ass,Bypass, and Re-gas!

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Mark Clark
Member
Mark Clark

Roundup is not used as a desiccant on corn, The whole idea behind Roundup Ready corn is that it is resistant to Roundup so the herbicide would be useless as a desiccant. You spray Roundup early in the growing season when the corn is less than 18 inches tall and the weeds have emerged and are actively growing. Roundup kills all emerged weeds and does no harm to the corn. This is long before the corn has pollinated and produced an ear.
I grew corn for over thirty years and have been associated with farmers who have produced corn for another 20 years and never heard of anyone using a desiccant for corn. Probably because doing so makes as much sense as burning twenty dollar bills to dry the crop after harvest.

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Peter Perez
Member
Peter Perez

Sorry for my lack of precision re corn…here it is re wheat. Despite being the incorrect grain, my assertion stands.

https://www.thehealthyhomeeconomist.com/pre-harvest-roundup-crops-not-just-wheat/

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Mark Clark
Member
Mark Clark

The only region of the US where any type of desiccant is used for wheat is in the spring wheat areas like North Dakota. The vast majority of wheat grown in the US are winter wheat crops and no desiccant is used on winter wheat. Winter wheat is harvested during the hottest days of summer so speeding up maturity or drydown is not an issue. Also there is no Roundup Ready wheat in existence so Roundup can not be used at any time while the wheat is growing. The only time you could use Roundup in wheat production would be to kill weeds before the wheat is planted or has emerged. It is safe to say that wheat grown in the US has less exposure to Roundup than just about any crop you can name.

The article cited conflates Roundup use as a desiccant with Roundup use as a weed killer.

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Kevin Remy
Member
Kevin Remy

In addition to trade war connections for the farm/corn article, I’ve been seeing quite a few articles over the past week regarding how little of the corn crop has been planted so far this year. Things like this: https://www.bloomberg.com/news/articles/2019-05-20/usda-crop-progress-corn-crop-49-planted-lowest-on-record

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