When you read the economic news releases in the mainstream media, you probably wonder what the real story is behind the headlines. And if you don’t, you should.
All too often, sources like the Wall Street Journal, or CNBC, or any financial media outfit aren’t telling you the truth.
Sometimes the truth isn’t obvious because of the way the media reports the numbers, usually ignoring the actual raw data for the universally followed and seasonally adjusted (manipulated) data. That’s just one problem.
But there’s a bigger problem that causes facts to become twisted and headlines to become lies…
What’s Keeping You From the Truth
The media doesn’t work for you.
They work for their advertisers and business clients. CNBC is the longest running infomercial in TV history, featuring the wares of Wall Street hucksters. Bloomberg uses free news reporting as a loss leader for its real business – selling information terminals to banks, brokers, and institutions at a cost of $30,000 per year per terminal. Reuters does the same.
Then there’s the Wall Street Journal, published by Rupert Murdoch’s News Corp Dow Jones subsidiary. News Corp isn’t really in the news business – it’s in the marketing business. For starters, Dow Jones is a sister subsidiary of Realtor.com, the online marketing platform of the National Association of Realtors.
That’s right. The marketing genius behind the latest US housing bubble is none other than Rupert Murdoch.
Another News Corp Dow Jones subsidiary is a company that you have never heard of. It’s called News America Marketing, whose slogan is, “Your marketing objectives are our business.” I want you to think about that every time you read a Wall Street Journal headline. The “you” in the slogan isn’t you. It’s News Corp’s corporate clients.
Think also about the fact that last year Dow Jones offered buyouts to all of its newsroom personnel to get them to leave their jobs early. Why? Because they’re expensive, and because some Journal reporters apparently still fancied themselves as journalists. They wanted to do straight news reporting. That’s problematic for the Journal‘s owners and managers.
You, the reader, aren’t their true customers. Their real customers are their giant corporate marketing customers.
Dow Jones wants PR people to churn out press releases. It does not need or want journalists to write in-depth news and analysis. Most of what you read in the Journal is nothing more and nothing less than corporate PR. The Wall Street Journal and CNBC are most interested in disseminating their PR, to manipulate you toward their clients’ “marketing objectives.”
With that background in mind, I’m going to look at the most important monthly economic data releases and report to you on a couple of angles.
As Always, Look to the Data
First, we want to know if the report reasonably represents reality. We can judge that by comparing the seasonally adjusted (SA) data with the actual, not seasonally adjusted (NSA) data.
Virtually all key data reports come with the actual version along with the SA version. But the media (and Wall Street pundits generally) NEVER bother to give you the facts revealed by the actual NSA data. I do that for you. The actual numbers often show that reality is far different from what the media is telling you.
We can also compare the data with known facts. Those known facts are the real time Federal tax collections data. That’s also never reported by the media. We want to be sure that the tax data supports what the media is telling us. I’ll have a fuller column about that tax data in a couple of weeks, because it presents a highly accurate picture of the country’s true employment situation with almost no lag… And yet, almost no one looks at it.
I report the tax data at the end of each month so that you know in advance what to expect from the economic data, which is always reported on fixed schedules with a lag of three to seven weeks, depending on the report.
After performing a reality check on the economic data, we want to know what it means for your investments and trading strategies. Usually the impact is indirect. Economic releases don’t cause stock market movements, other than in the very short-term, knee-jerk reactions.
Yes, if you are a trader, then knowing the facts behind the news and knowing whether the consensus expectation is likely to be high or low can help you in preparing your trading tactics.
But most of us aren’t traders. We just want to know whether to buy, sell, or hold our investments.
Simply reading the news reports uncritically won’t help you to do that. Knowing the facts behind the reports will.
I’ll look at the most important of those reports for you right here, and will present the facts to you so that you can:
- Clearly see what the facts are
- Compare them to Wall Street’s (sometimes false) narrative
- See how that relates to the market, and
- Determine what actions to take.
We’ll get started on Wednesday with an overview of last Friday’s jobs report.