economy Markets

Data Doldrums And The Futility Of Financial ‘Journalism’

On rare occasions, I'll extricate myself from my desk chair...

On rare occasions (usually on slow Fridays and on the weekends), I’ll extricate myself from my desk chair, throw my rapidly aging MacBook into my weathered messenger bag and venture out into the real world for a couple of hours.

I always promise myself I’m going to find new spots to work from, but invariably, I always land at one of three picnic tables at what counts as a “bustling” harbor here on the island. There’s decent WiFi, which means I don’t have to burn through my phone’s data plan to connect and my generally unapproachable demeanor helps ensure that only the bravest of passersby try to engage me in conversation.

One of the most interesting things that happens to me on these brief excursions is the strange feeling I get when I juxtapose the language that we – as a community of people who write about markets, economics and finance – employ to write headlines against the backdrop of open air and real people going about their daily lives.

Friday offered a couple of particularly poignant examples in this regard. Here’s a headline from Bloomberg’s piece documenting this morning’s read on Q4 GDP in Canada: “Canadian Dollar Slumps on ‘Gruesome’ GDP and Sliding Oil Prices“.

Now, look: I get it. The Canadian economy expanded at an annualized 0.4% in the final quarter of 2018, a grievous miss versus consensus (1%). Things were made worse by the fact that somebody up there screwed up and published the data at least 26 minutes early, confusing markets. Apparently, all that separated the economy from a Q4 contraction was a buildup in inventories (inventory accumulation jumped by C$8B during the period, adding 1.53 percentage points to growth).

The loonie of course plunged. I doubt if you need me to annotate the following chart.


A slowdown was expected (Q4 was rough for crude) but the internals were bad. “It’s a much bleaker picture than anyone anticipated with weakness extending well beyond the energy sector”, Bloomberg wrote, adding that “consumption spending grew at the slowest pace in almost four years, housing fell by the most in a decade, business investment dropped sharply for a second straight quarter, and domestic demand posted its largest decline since 2015.” Obviously, this raises questions about the relative wisdom of the BoC’s policy bent and it only adds to concerns about the global economy more generally.

As I read about all of this from the harbor on Friday morning, I chuckled at the thought of what would happen were I to beckon to the next person walking by (pssst) and, when they got close enough, whisper that Q4 GDP in Canada was “gruesome” and just “all around bad” (to quote one FX strategist at TD).

In all likelihood, that theoretical civilian would have recoiled, but not because of how bad the data was – rather because the weird guy in the red Givenchy hoodie at the picnic table is whispering to random people about Canadian economic statistics.

And the same thing goes for Friday’s ISM print in the US. 54.2 was the worst read since November 2016 (or, more to the point, since the election) and represented a marked decline from 56.6 in January. It was just six months ago when the gauge was parked at its highest level in nearly a decade and a half.


I don’t even have to look to know that somebody, somewhere (whether it was a mainstream financial media outlet, a blogger, or both) characterized that as a “crash” or a “plunge” back to where we were in December – that’s relevant because if you recall, December’s print represented the worst MoM drop since October 2008.

And there were other lackluster data points on Friday (the final read on U. of Michigan missed too, for instance), that seemingly underscore the idea that the US economy continues to decelerate despite Thursday’s better-than-expected GDP read and in line with the global slowdown narrative.

But again, regular people don’t care about any of this. There is something profoundly absurd – and wholly bizarre – about squinting at a laptop screen and parsing the internals on all of the above while real people, doing real people stuff bustle about just yards from where I’m sitting.

On the rare occasions when I actually do engage in conversation with real people and they ask me what I do, my current “occupation” (if that’s what you want to call it), is wholly uninteresting for the listener. It’s only when I get into stories about my previous life or bring up broader topics that are tangentially related to what I write about in these pages that folks’ interest is piqued.

And yet we (and again, “we” refers to my membership in the community of people who write about markets, economics and finance on a daily basis), spend most of our waking hours penning stories, spinning narratives and applying bombast to every single data point that crosses the wires, in a never-ending quest to pretend like what we do has meaning.

The irony, of course, is that this data, when taken as a whole, ostensibly represents the economic reality that in many ways shapes the lives of the everyday people who only care about it when something bad enough happens that it manifests itself in outcomes dramatic enough to materially alter their quality of life.

That, in turn, gets at the heart of why it is that concepts like MMT and the policy initiatives pursued by the new breed of progressives like Alexandria Ocasio-Cortez are getting so much attention.

These are ideas with the potential to bring about real change in the lives of everyday people and, importantly, on a dramatic enough scale that if I were to reach out and grab a passerby by the arm and strike up a conversation about it, that person wouldn’t question whether I might be unhinged as they would were I to start talking about a disappointing read on Canadian GDP or the worst ISM print stateside since the election.

A testament to all of this was a conversation I had recently over Twitter DMs with a reasonably well-known financial journalist. As much time as I spend poring over sellside notes and delivering long-winded, overwrought takes on anything and everything market related, you’d think the most engaging discussions I would have with journalists and analysts would center on markets – even if only for them to disagree with what I write. But what captivated this particular journo was my take on the misappropriation of the word “hustle” in a New York Times article called “Why Are Young People Pretending to Love Work?

The overarching question in all of this is whether financial journalism has devolved into little more than an effort to see who can sensationalize things that nobody outside of a very small circle actually cares about.

Nobody worry, though. The apparent futility in documenting every twist and turn in the incoming data isn’t going to stop me from doing it everyday.

But maybe it should. After all, it wasn’t “markets” (in the sense that we talk about them here, anyway) that bought me this Givenchy hoodie.



7 comments on “Data Doldrums And The Futility Of Financial ‘Journalism’

  1. Just keep doing what you do.

  2. I don’t Givenchy a damn.

  3. Somehow there has to be a way to say what I think you are saying in a simple way.. I guess I will try……(a challenge)…
    I liken this data parsing to manually turning a heavy wheel on it’s axis.. There are tight spots we heat and grinder spots we oil and other tight spots we ignore or just ‘bulldog ‘ through. Making a long story short, the wheel turns easier but only for a while and in reality not at all. So most data we get is irrelevant in a sense because it is merely a reaction to someone spinning or hyping or misrepresenting or kicking a can one more yard or two down the same old road going nowhere. There is no true momentum only choppy little reactions to non actions.. That my friends is why a lot of smart people got whip sawed around the last few years and no true conviction or consensus prevails.
    All that prevails is in fact known as self interest.. It is fun playing this game and that is why we all do just that…

  4. It is hard to find meaningful analysis such as yours on seeking alpha even. even if it makes for depressing reading.

    • This person is one who once was clueless as well, not because I wanted to be but because ” I didn’t know what I didn’t know. ” I love sarcasm, I love to learn and I like learning about how the financial world works, and I do mean WORLD. Plus I was a sociology major and at the end of the day it’s all about people and how they behave or misbehave….

  5. If I were to engage there would be interest in the Canadian state of affairs up until it became burdensome for you to answer all of the whys. Once there I might want to pivot to the Geology of the Tx Panhandle or the Muscle Speakers of the early 80’s the models that provide at least
    hi mid fi sound quality, obviously. Those topics usually holds interest at least the mention of upgrading old electrolytic capacitors, or after the discussion of the impact of the Younger Dryas. It is hard to hold interest with circuitry or after mega-fauna likee Dire Wolves, the Short Face Bear, the Sabre Tooth Lion and the Giant Bison have mosied out of the landscape. Perhaps I would walk away having met a fellow boulder in the seawall, or some type of similar edification the brave occasionally find.

  6. Camus would be proud

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