My Complaints About Those Who Report on the Stock Market

I remember seeing somewhere a spoof of the NY Times (NYT) slogan "all the news that's fit to print." It read, "all the news that fits the print." Note the movement of one letter takes it from printing all the news to only the stuff they have room to print that day.

I'll digress to the Daily Show and one of their ads that said, "More people get their news from the Daily Show.........than probably should."

Does anyone disagree that news shows are there to sell ad space and not champion the public and their right to know? Jon Stewart skewered CNBC for that very idea. Which brings me to my own rant about those who cover the stock market.

This is an excerpt from a financial news story Friday morning:

Quote Contrarian indicators reach new extremes - The VIX, an index of expected volatility on the S&P 500, has sunk to about its level when Lehman Bros. declared bankruptcy. If it falls much more, some analysts say they will be on guard that the market is getting ahead of itself.

The VIX being at this low level is a sign that investors have become somewhat complacent about the current economic problems," said [name withheld], portfolio manager with [name withheld], which manages exchange-traded funds and index funds.In an email interview, [name withheld] said that at current levels in the VIX, one could "make an argument the market is overbought.

(with apologies for the two typos in the chart)

First, let’s start with complacency levels on the VIX. They would be extreme lows – not just lows for a short period. Complacency kicks in with the VIX in the teens so a VIX in the upper 30s is far from complacent. These sorts of readings were considered extreme highs – and fear – before the financial crisis began. End of rant. I feel like Jon Stewart - only not as funny.

Comments

[Asitoughtobe:]

Point well taken, it's obviously all relative in today's environment.

Or in the eye of the communicator (beholder beware).

Healthy Investing!

May 17 02:02 AM

[athena:]

How strange, you still listen to those that report on the stock market?

May 17 02:49 AM

[Fabien Hug:]

VIX level is one thing, its movement is another. The lows were in a completely different era. The steepness of the drop shows some level of complacency and certainly shows some desperation on the side of the investors; where else can you invest if you want to earn some money.

May 17 02:25 PM

[Fighting Yoda:]

Media is always biased towards bullishness - that is what most viewers/readers want (or are) - because most people only bet on the long side 401K, mutual funds etc. Also who are the sponsors etc of all media - Wall Street - their business model is bullishness - they make money as long as you let them invest it.

May 20 01:33 PM