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Groupthink

by Gormack on April 20th, 2016

ZeroHedge retweeted a Burning Platform post last week that asked: “Why Is the Mainstream Media Covering Up Recessionary Data?”

Excellent question!

No doubt, MSM spins, under reports, or blocks news that doesn’t fit the profile, and overplays or dramatizes news that does. But what profile? And at whose direction?

This has been going on in the other arenas for years: it’s simply not possible for conservatives, political, social, or moral, to get honest coverage. Look at the last two presidential cycles!

But the wholesale application of bias to financial markets seems more recent. Maybe the State of the Union Address is a clue. With no time to fix things before November maybe the “Life is Beautiful” message is the socialists’ best hope to keep the White House. They can hope the Proles have forgotten what a healthy economy looks like. See the post I wrote at the time: The Big Lie

The camera facing Talent has fallen in line with the official line! Who can argue with 5% unemployment; even if the numbers are a fabrication of the BLS using workforce participation. Courtesy of the “Media”, the “Mainstream” will never know the real number is pushing 25%. (see ShadowStats.com)

CNBC ran this headline on Morgan Stanley’s earnings report: “Morgan Stanley beats estimates as profits decline.” This prompted these comments by David Stockton:

 it’s hard to imagine how its results could have been much worse. Non-interest revenues were down 26% over prior year, including drops of 18% and 43% for its core business of investment banking and trading, respectively. Overall, total revenues plunged by 21% versus prior year, and net income dropped by a staggering 54%.

 Pretending that this is a “beat” is not only an insult to 9th grade intelligence, but actually emblematic of the institutional lying that has become built into the fabric of reporting.

ZeroHedge ran a great piece on “Non-GAAP Gimmickry” or “How Alcoa prettied up their numbers”:

 Some companies are notorious for buying back billions in stock in order to mask the decline in their earnings by reducing the number of shares outstanding. Alcoa, which still has a major debt overhang from the last financial crisis, is unable to do that as it simply does not have the free cash flow to dedicate to shareholder friendly activities. Instead, Klaus Kleinfeld’s company is forced to resort to an even more primitive form of EPS fudging: massive quarterly EPS addbacks.

MSM embraced the Morgan Stanley and Alcoa creative accounting numbers; no questions asked.

So who are these people who can’t see through transparent chicanery; don’t know the difference between GAAP and pro-forma; and are perfectly ok with buybacks (and addbacks) as a way to puff up P/E quotients?

Charles D’Ambrosio pointed out in his short story “Loitering” that the women you hear on the airwaves are sorority girls who majored in journalism. Good point!

Michael Lewitt ran a great piece last year that included this commentary:

. . . they have no clue what is going on because they are merely paid actors. In England, they are called newsreaders for a reason. They read the news. They don’t make it and they don’t analyze it.

Unfortunately, CNBC anchors speak with authority about things that they know nothing about.

To be fair, editorial decisions on what to run and what to kill are often made a level or two above the “newsreaders”, but someone at the media outlets has a stake in painting rosy pictures of a world that is getting darker by the day.

But what is the motivation? Is there a lecture in Journalism 101 at Northwestern that runs something like this?

In the primitive forms of journalism practiced years ago, writers strove to stand aside and to present the facts as clearly and objectively as possible for a reader to draw his own conclusions.

But now it is now understood that our practice must go beyond clinical presentation of information; the responsibility of each and every journalist, editor, and publisher extends to promoting “right thinking” in his readers.

It goes without saying that Entertainment leans left; and it’s certainly safe to say that twenty something journalism majors (and sorority girls) tend not to be Young Republicans. So it’s not surprising that “correct thinking” as promoted by this group would be closer to Karl Marx than Adam Smith.

Their work is not so much different than Winston Smith’s job at the Ministry of Truth: adjusting facts to the party line and putting Truth down the Memory Hole.

One might have thought such dishonest behavior would have to coerced, but it seems to be something of a civic duty to protect the Proletariat from the truth in order to insure correct perceptions.

George Orwell called it Groupthink.

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