Warning: Fake News Journalism Can Be EXTREMELY Dangerous to Your Financial Well-Being
One of the greatest accomplishments of the Trump presidency has been his invention of the phrase “fake news.”
What the president means by this term is that media officials and journalists no longer perform actual reporting. Few if any news stories are fact-based. Instead, much of what is published in the media under the term of “news” is either:
- An opinion piece masquerading as factual information.
- A false narrative that was invented whole cloth by a political operative who claims to be a journalist.
- An attempt to explain a situation written by someone who doesn’t understand it and who didn’t bother calling real experts to find out what is going on.
Whether you like the president or not doesn’t matter. The media is meant to at least try to perform objective reporting. And the fact that he calls them out and expects them to maintain a higher standard is a good thing for the country – no matter which political party you prefer.
If you think I’m being partisan here, consider the damage that would have occurred to your portfolio if you’d taken the media seriously in its claims of the coronavirus inducing a global pandemic…
Below is a screenshot of headlines related to the coronavirus from this morning.
Based on these headlines, you’d think the coronavirus was the beginning of a global pandemic that will soon kill a significant percentage of the world.
The markets – which are fact-based, NOT narrative-based – say otherwise.
Take a look at the Chinese stock market’s performance over the last few years. Does the recent correction in Chinese stocks (dark blue rectangle) look like the beginning of a global pandemic to you? Would you have even been able to identify it relative to the other corrections Chinese stocks have experienced in the last few years?
And what about copper?
If global growth is about to collapse as the coronavirus shuts down the economy, surely copper prices would have imploded, right? After all, copper is one of the most economically sensitive commodities in the world!
Again, if you didn’t read the news, would you even know coronavirus was an issue based on this chart?
I want to be clear here: I am not making light of the coronavirus. Any time someone loses their life due to an unexpected illness, it’s a great tragedy.
But as usual, the media is going overboard and producing fake news in order to generate traffic to their websites and nightly shows.
Meanwhile, U.S. stocks have already reversed their correction related to coronavirus (dark blue rectangle below) and have soared to new all-time highs.
Anyone who sold stocks based on the false narrative of coronavirus has lost money, quite possibly a lot of it.
Here’s the bottom line…
Whether you like President Trump or not, fake news is a major problem, both for the country as a whole and for investors in particular. No matter how smart you are, if you base your investment decisions on bad reporting…
You. Will. Lose. Money.
This is why I prefer to always look at how the market is reacting to “breaking stories.” Stocks don’t care about political leanings or false narratives. Stocks are a discounting mechanism of what is actually happening. And as such, their reporting is a lot closer to reality than much of the journalists who write for major outlets today.
Editor, Money & Crisis
P.S. In other news with the markets, did you know there is a secret behind the crazy stock market swings? My colleague James Altucher is a computer genius, who was on a mission to find the market force driving investments up and down, and after hundreds of hours, he found it! A stock market glitch — but what he discovered was shocking and a clear signal, giving regular folks a chance to profit. Click here to see what he has uncovered.