If you follow the stock market, and who doesn’t, you tend to read… A LOT. (Never argue with a guy who takes the time and trouble to use the caps lock key.)
I read all things financial, thus I read about economic developments, global and domestic, industries, corporations, and opinion pieces on what’s driving market action.
Warren Buffett has it down to a nano-science, reading about trends in shipments of corrugated cardboard by rail. I guess it’s easier to do that when you actually own a railroad.
However, Warren’s reading habits are much more specific than what Mom and Pop would generally read about the stock market.
In 2015, Mom and Pop Investor-Trader-Speculator (believed to be a Mammonite surname) have a plethora of sources to get caught up, so to speak, on all things financial.
Some of the better known print sources:
- Wall St. Journal
- Financial Times
- Barron’s Magazine (Alan Abelson, the greatest)
- Investor’s Business Daily
- The Economist
Some of the more popular online sources:
Then there are the thousands (tens and tens of thousands?) of blogs about investing, trading, and speculating ranging in grade from an A+ to F in usefulness.
I want to focus on the names that Mom and Pop would tend to go to first to get their financial update.
So what is it about these purveyors of financial truth, rumor, fact, and fiction, the financial writers of capitalism? The publisher’s job (print or digital) is to attract eyeballs and keep them coming back. The writer, to keep his job, may or may not slant his view accordingly, but he must bring the reader back.
Have you ever, EVER, seen this headline: “Sell Now, Today! The Wheels Are Coming Off,” from any of these sources? No, you haven’t, nor will you ever.
Like the Gillette business model, financial publishers need readers to return daily or risk not being in the Wall Street loop. I suppose we tend to follow general daily news and keep going back for the same reason, being at risk of not knowing who nuked who.
Let me make it clear that I read and watch all financial media, all that’s shown above and about fifty lesser known online sites with a reserve of three hundred or so sites, for when I want to dig deeper. (Note to self: get a life.)
There is a rhythm in stock market action as in market news and developments. Financial publishers, whose job is to prime the pumps, like an oil rig, push readers into nirvana or woe with the twist of a headline. A brokerage firm’s dream.
However, Mom and Pop start their reading and researching after receiving poor old wealthy uncle Charlie’s inheritance. Unfortunately for them, he didn’t leave instructions on how to hold on to this wealth.
Maybe they can get some clarity as they peruse the pump stations.
Woe to them if the start by stumbling across zerohedge.com as a source of news that’s fit to print, to borrow a phrase. Uncle Charlie’s check would probably never be cashed. Whoo hoo! all things capitalist is not their genre.
BusinessInsider.com, now there’s a WHOO HOO! all things are good to go, well most things of late.
I put the spotlight on those two as they are extremes of style and opinion.
The Investor-Trader-Speculator clan moves to the classic time-tested high drama pages of the Wall Street Journal and the others. Surely there they will learn what they must to invest wisely, soundly, and profitably.
Mom and Pop could have taken the easy way and just walked into a neighborhood brokerage firm, now in every commercial bank, and said, “We don’t know what to do.” Investment counselor: “No problem. Have a seat.”
But Mom and Pop didn’t take the easy way out. They entered a world of ever-changing hype and opinion on both sides of the bovine-ursine equation after learning that those animals had nothing to do with farm or forest.
There’s an adage on Wall Street: If you’re going to predict, predict often. How’s daily work for you, is that often enough?
Writers with a byline for both print and online may or may not have an ongoing bull or bear view on the market. But Mom and Pop wouldn’t know that unless the writer spelled it out daily that his is and has been a bullish or bearish approach to the stock market all things considered.
One time stories about so and so the multibillionaire hedge fund manager who’s incredibly bullish or bearish is after all, one man’s opinion with an agenda, assuming the author didn’t editorialize. What do Mom and Pop learn from that? They can now spell bovine and ursine.
I tell my students to read both bullish and bearish views and then watch the charts. The charts don’t editorialize, they don’t care, but they do capture behavior. That behavior is not opinion, it is trillions of dollars moving between the currency, bond, stock, and commodity markets. The behavior leaves a trail of ink on those charts. Over time, from the most recent mark on the right edge of the chart looking backward, we can see exactly what the market thinks as it executes the collective opinion. It is either trending up or down. It is not opinion, spin, hype, or hope… it is what it is.
Watch the charts, Mom and Pop, for as Will Rogers said, “Don’t gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don’t go up, don’t buy it.”