The other day I came across an article in MarketWatch that was trending number one on its “most popular” list (“Peter Schiff, more bullish than ever, sees gold heading to $5000 an oz.”) — (close 5/15/15@ $1223/0z.). The fact the author, Myra P. Seafong, chose to write on this is amazing. Even more jaw-dropping is that MarketWatch readers are even paying attention. Schiff’s track record is less-than -stellar. To tell the truth, it has been awful.
For as long as I can remember, Peter Schiff (Euro Pacific Capital, Inc.) has been negative about the US economy, the Federal Reserve and stocks in general. The only investment he ever highly favored was gold. This was absolutely the right call as the clock stopped in 2007. Unfortunately, he never abandoned his negative call on the market or the positive call on gold, even in 2011 when gold peaked at $2000/oz. To this day he has continued to bray for higher gold prices, sky-rocketing inflation and collapsing stock prices. Some day the clock will stop again. Again, the question arises, ‘with this record, why should we care?’ And, why should Ms. Seafong even have written this article? Her inane reasoning runs this way: “Gold’s sluggishness makes Schiff’s dogged call on gold all the more notable.”
In my mind this is hardly newsworthy or a startling new revelation or a different twist on the Schiff ‘party line’. No, it is a deliberate attempt to get eyeballs to MarketWatch … negative headlines get eyeballs. And, gold going to $5000 would signal very bad things happening in the economy and Stock Market.
New Rule, Please!
Actually, it is not a new rule for Wall Street and the Securities Industry. It is something that was put into effect in the wake of the WorldCom and Enron debacles. Simply stated, if you publish research (Buy, Sell or Hold recomendations), you must provide a history of your past recommendation on the security — dates of rating changes and price objective changes. This makes it very easy for the research consumer to judge the credibility of any advice and calls on a stock. This same discipline should apply to all media.
‘New Rule’ may create great problems and benefits!
If this rule were to be implemented, the media would be in a real pinch. It would be very difficult to find pundits and analysts with respectable track records. Ergo, much of the ill-conceived, down-right bad advice that permeates the airways and print media today might go away. No one will want to present, as experts, people that are never (or seldom) right… Voila! …. an immediate drop in AIR/www. Polution!
Ergo, What is good for the goose (that lays the golden eggs) is good for the gander(s) (that feed off her exertions).
Regrettably, even if the rule were implemented, most people would pay no attention, as the world seems to thrive on negative news. Here’s the following day’s top-trender (another perennial bear, Paul B. Farrell): “Countdown to the stock-market Crash of 2016s ticking louder.” Oops! here’s one more top-trender from this morning: “Signs this bull market is running out of steam”.
What do you think?
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Stock market running out of steam? What is the likelihood of filling up at the water tank and tossing some more coal in the fire. In other words will the private sector begin to fuel the economy as the government pulls back?
My bet is that is already happening, not to mention the continuing positive impact of China/ India rising. Seems to be a lot more room to run. Bull markets normally end in exuberance. This continuous cautious, negative stance by most of the media is one factor that says we are not there yet. In fact, we seem to be a long way from the end. That does not mean no scary corrections and volatility. Both would be normal. but, I believe the longer-term trend is up. Thanks for your readership and the comment.
Bill. You are so smart and your columns are so entertaining that I am amazed that the WSJ or some other syndicate doesn’t sign you up.
Tom, thanks for your kind comment. Recent performance of the Kort portfolio challenges any notion of me being smart. Fortunate for all I have chosen not to give individual stock advice. As to being picked up by a syndicate or media outlet, not sure if they would be happy with my continuous anti-media rant. Also, to be useful (based on my experience) I’d have to be negative …all the time.