When it comes to economics, source is everything. Wall Street, the Federal Reserve, Congress, the administration, mainstream financial press, television, most periodicals and their affiliated websites are all in business to maintain the status quo.
It’s an extremely profitable closed loop whose owners stand to lose a lot of money if the public ever loses faith in the system. Given the degree to which these various entities are interrelated these days, we shouldn’t expect any different.
General Motors isn’t going to advertise on a network that disparages its products or questions its accounting practices, let alone award an underwriting to a brokerage firm with a sell rating on its stock. And, it would be naive to think that the latest employment or retail sales data isn’t “managed” both in content and how it’s reported on television.
Even when reporters and economists have the best of intentions, they get it wrong more often than right. So, why bother? Because, as long as some investors believe what they see and hear, markets will continue to be affected. So, read the financial press with a grain of salt. Listen to the brokerage firms with a great deal of skepticism. And, when someone from Washington tells you everything’s going to be fine, run for the hills.