The definition of piling on, according to the football website, football.answers.com, is: “Once that the ball carrier is down, or more specifically, prostrate and helpless, jumping on that player would be piling on” … a fifteen yard penalty for the guilty team. This holds true even if only one player does it.
Too bad the media, oftentimes guilty of piling on, doesn’t get fined or penalized when they resort to this tactic. It might stop some of the more egregious and totally stupid commentary they provide when the market appears to be on the ropes, as it was last week and CNBC again proved itself at the top of its game when it came to this infraction.
CNBC is shameless!
They took a story that probably did not deserve airtime anyway, a positive Christmas retail sales forecast from two different sources, spun it negatively to scare people and piled on a market already on the skids because of the Fed’s recent decision not to raise rates.
Here is the story without spin: Deloitte (an international accounting/ consulting firm) published a study forecasting retail sales this holiday season to be up 3.4% to 4% (ex autos and gasoline) this holiday season (Nov thru Jan. 2016–using January as end point captures gift cards). This would be versus 5.2% in the same period las year. Another concern. AlixPartners, called the potential gain at 2.8% to 3.4% versus 4.4% (also ex vehicles and gas–Nov. and Dec. were the only two months forecast). In both cases the forecasts may not be quite as robust as last year, but still positive…and certainly no disaster. Also, we are still a long way from the beginning of the Christmas selling season and, you all know how prescient forecasters are.
Now, the CNBC take:
Here is more CNBC video on the subject. Interestingly, this version is comparatively milder on the negative tack than the network took when they broke the story earlier Wednesday. That version was evidently pulled because, in context of this very preliminary and generally positive data, it was much more negative in its tone. Importantly, who knows what Christmas sales are going to be this year? General experience of nearly one half century watching these pronouncements is that they generally always start out negative, i.e., Christmas will be a bust this year. In the end the American consumer always comes through. Of course, you never get that kind of history or perspective from these guys. If you did, this non story would be even less compelling. BTW, this will not be the last time you will hear the stories of Christmas sales being a potential flop.
Regardless, I see the way CNBC handled this story initially as Piling On in an already fearful, negative market environment. They thought they had gold here (pouring a little gasoline on the fire), with its potential to add further fear and confusion to the average, already worried, investor. It was strictly a ploy to gather eyeballs. Pay attention to this noise at your own peril. CNBC has “distinguished” itself again!
What’s your take?
The information presented in kortsessions.com represents my own opinions and does not contain recommendations for any particular investment or securities. I may, from time to time, mention certain securities for illustrative purpose, names where I personally hold positions. These are not meant to be construed as recommendations to BUY or SELL. All investments and strategies should be undertaken only after careful consideration of suitability based on the risks, tolerance for risk and personal financial situation.