TCS Daily

Bard for Life

By Jerry Bowyer - August 24, 2007 12:00 AM

William Shakespeare taught me how to read financial newspapers. My favorite play, Much Ado About Nothing, is well titled, because it is, in fact, a play about nothing. More precisely it's a play about things which might be real, but turn out not to be. In other words, it's a lot like today's media.

I'll spare you the intricate plot, the misunderstandings and misunderstandings of misunderstandings. In the end it turns out that none of the problems was real. The prince really did keep his word. The fiancé really was faithful. The bride's death turned out to be a hoax. All of the problems in the drama came from false rumors and from people's reactions to them.

One way to keep track of these complicated comedy-of-errors plays is to take a blank sheet of paper and draw a line down the middle of it.

In the left column you write facts like "Hero is faithful."

In the right column, you write feelings like "Claudio thinks that she is not faithful."

Winter's Tale, Much Ado, Twelfth Night, whichever of the misunderstanding comedies you read, you'll find this a helpful tool. If Shakespeare is too advanced for you, try it with old re-runs of Three's Company, if even that's too difficult for you, best to stay away from markets, and (for safety's sake) refrain from operating heavy machinery.

Next time you read a newspaper, I want you to try the Much Ado about Nothing Analytical Tool. In the left column you put sentences with stats based on an actual count of something real - jobs, dollars, interest rates, prices. Quotes, if they are substantial, go in the left column too. Actual events like hurricanes, elections, wars and terrorist attacks are definitely left column material.

Your right column is for sentences with words like 'worries', 'concerns', 'expectations' or 'believes'. Unattributed quotes go on the right, as do short quotes. Opinion polls go on the right. This includes opinion polls masquerading as economic stats like consumer confidence, or business confidence. Elections and futures markets, however, go on the left. 'Sub-prime jitters' is a left column thing.

Now step back and compare your two columns. The first column is a glimpse, however incomplete, of the world as it is. The second is a glimpse, no matter how distorted, of the world as people perceive it.

There is almost always a gap between the outlook of the two columns. Eventually the right column catches up with the left, as reality gradually forces itself into people's minds. In the meantime there is a gap between fact and feeling - a zone where you can see the world clearly and see just as clearly how public opinion is clouded by emotion. That zone, my friend, is where leaders are made.

When perception is more gloomy than reality (as it has for the past several years), effective leaders invest. When perception is more cheery than reality, effective leaders walk away. Buying in the midst of a panic (or selling in the midst of a mania) can be a very uncomfortable place to be, and the longer it takes for the crowd to catch up the more painful it is. But don't worry, as the Bard said in another context, "Truth will out."



News and Views...
used to be separated. Now the "views" begin to appear on page one, above the fold, disguised as "news"; or, in the first minutes, before the first commercial. This is the best reason to avoid the "viewspapers" and the "evening views".

I guess it is "easy being green" compared with being objective! Someone tell Kermit.

Not entirely true
When were they seperated better than they are today? Certainly not five or ten years ago; no, not even 20-years ago or 30-years ago. I go through old newspapers all the time and I can guarantee you it wasn't 70, 80, 100 or 125-years ago.

I worked in the news business for 20+ years, mostly small weekly newspapers. One of my favorite past-times was to go through old newspapers to get an understanding of the place I was at and the history of it. also because, early on, I found the old newspapers interesting and often amusing.

I have never found this "magic" time where this wonderous truth was always laid straight out and where there was never any opinion in the news. Aftern WWII there was an attempt to "standardize" writing styles and news publishing in newspapers and it continues to this day. Advertising is much more truthful than it was even 30-years ago. the seperation of opinion-based peices, humorous semi-fiction and news is much better than it was in the pre-1950's era.

If there was a "golden" time for newspapers in this respect it was probably the 50s and 60s. But, by the mid-60's this was beginning to disappear. It began on two fronts. 1. Government reporting - Once the news felt they were lied to and they had published the deceit (over the Vietnam War and other issues), they got a bit surly and began going with back-door sources. A Supreme Court decision allowing that it was the New York Times right to publish classified documents it had obtained really opened the door here (403 U.S. 713 - 1971). Unfortunately, that right has been abused time and again since.
2. Issues reporting - for some reason (probably the war protests and racial tensions of the 60s) news reporting took on the guise of "backer of the minority and oppressed. Here is where liberal bias took off in the media and has never relented. From environmentalism to special groups (gays, religious minorities, etc.) the media has been a big part of pushing these agendas and getting some of them real political power. This is probably the area you most mean when you say opinion is reported as fact.

In the end, the "Media" "MSM" or whatever tag you want to used really doesn't exist. There is no one single entity making decision on what is on every news broadcast, is published in every paper and what is pushed. There is a saying "that story has traction", which means that it is, or will be, picked up by several large news sources. This is a phenomen, largely, of TV news.

Lastly, if you aviod newspapers and the evening news, how do you know what is going on? Read your favorite blog on the net? Great!! What do you get from that? Mostly opinion!!

I find an hour a day reading a newspaper or watching the evening news gives me a strong overview of what is going on in the world around me. To get the same level of depth and bredth would take hours of searching and reading on the Internet; unless I go to one of those news organizations websites.

Bottom line: people are biased and have always been biased and will always be biased. When someone says they are unbiased, they are either lying to you or they are lying to themselves. Either way, ignore them, since you don't want information from someone who either wants to delude you or is so un-self-aware as to delude themselves so badly.

If you really want an "unbiased" view of something more complex than chemistry (meth, physics, and chemistry are all simple enough as to be pretty clear and proveable facts), then you have to read as many different views of the subject as possible. And be sure to note the biases, for that will tell you the person's motivation. Under all of the mere opinion, it is possible to derive some sort of true opinion (to use Plato's terminiology). I read/watch CNN and Fox News because somewhere in between the two lies true opinion on what happened in the world.

"...somewhere in between the two lies true opinion on what happened in the world."

My interest lies in "what happened in the world". I'll decide what my opinion is based on the FACTS; and, on the OPINIONS and COMMENTARIES of others I trust. The term "newspaper" suggests, at least, that what appears in the paper is NEWS, with the exception of the editorial, opinion and commentary pages.

The county in which I live has a monthly "viewspaper" which claims to be a "newspaper", the last issue of which featured two opinion pieces and an editorial on the front page; and, a "labeled" opinion piece on the next to last page. It is obviously less sophisticated than the "Rag of Record", in which the "views" presentation within the news is more subtle.

Shakespeare in love....with power
Interisting article and I'm not much up to date on WS, but it seems like he would have been a 'big government' guy, or a statist. YOu see things like condeming a prince or king for killing another one, but it's ok to kill a whole bunch of peasants, or what about the one where the power structure guys screwed the jew shylock?

News sources do not provide news. They provide entertainment.
Modern news reporting is the art of entertaining the audience to compete with the other media at large.

Didn't your highschool English teachers tell you that in the news business: Dog bites man is not news. Man bytes dog is news. Or the more modern version: Placing bets on man on man fighting is not news but doing the same for dog on dog fighting is news.

Combine this with the normal journalism majors of today then flavor it with a media GENIUS like Murdoch and you get this crazy mix of news and information and opinion and entertainment.

The difference between political/social and business journalism
is that people will *pay* for good, high-quality information delivered in a timely fashion -- be it fact, opinion or a mix of both. If Mr. Bowyer categorized the WSJ, Financial Times, Bloomberg, etc., content, he would see plenty of facts, as well as opinions and actions of market participants, all of which is valuable trading information.

Another alternative would be to only read SEC filings all day... Yawn... that would be boring and very ineffective, at least without some of the software programs for managing the information flow...

Finally, I don't think Shakespeare was a statist like Dietmar wondered. Recall that Shakespeare (or deVere, or whoever he was) had the Lord Chamberlain as patron, and needed QE1 and King James to continue liking his plays to continue to work. His political views, therefore, are hard to pinpoint. His art rises above his politics... something the Sean Penns and Tim Robbinses of the world today would be wise to emulate.

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