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The Zeitgeist – 5.16.2019

Summary:
Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it. But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world. From the headline, I thought they were going Full Robinhood, but no, it looks like your usual gym-bag-and-a-toaster kind of offer. There has been a clear, concerted effort – with click-hungry financial media happy to oblige – by missionaries of banking to make the narrative about US banks a modern, fintech-oriented technology story. There’s a reason these stories

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Ben Hunt writes Narrative is not a Disease. Narrative is Us.

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Rusty Guinn writes When Meta-Analysis Goes Meta

Ben Hunt writes I’ve Got a Secret

Every morning, we run the Narrative Machine on the past 24 hours worth of financial media to find the most on-narrative (i.e. interconnected and central) stories in financial media. It’s not a list of best articles or articles we think are most interesting … often far from it.

But for whatever reason these are articles that are representative of some sort of chord that has been struck in Narrative-world.


The Zeitgeist – 5.16.2019

From the headline, I thought they were going Full Robinhood, but no, it looks like your usual gym-bag-and-a-toaster kind of offer.

There has been a clear, concerted effort – with click-hungry financial media happy to oblige – by missionaries of banking to make the narrative about US banks a modern, fintech-oriented technology story. There’s a reason these stories routinely sit at the top of the Zeitgeist – because banks want to be conflated with these much more exciting, growthier sounding, less LOL-whoops-we-almost-broke-the-system-through-sheer-avarice sounding ideas. And like this free trades offer – which is a modestly expanded version of what has been offered by brokerage firms for decades – most of those stories are part of that cartoon.


Quote the first:

The Zeitgeist – 5.16.2019

Quote the second:

The Zeitgeist – 5.16.2019

Oof.

If you pay much attention to the network maps we post with our Daily Zeitgeist, you’ll know that retailing and consumer products routinely command a highly connected cluster within them. Part of that is because financial and markets-focused media know that even professional consumers of their content are more interested in stores and stuff they buy themselves than they are with utilities companies, or, say, fabricators of high-temperature, high-strength alloys for use in furnaces at petrochemical facilities.

So it’s not a surprise that stories like this rise with some frequency.

It also shouldn’t be a surprise that happy-clappy all-is-well stories like this find their way to the top. Even when the industry in question is tire fire territory, financial media are cheerleaders, publishing news which is almost universally more positive in sentiment and affect than any other major form of news – certainly more positive than political news, at any rate.


Ready Or Not, The Food Of The Future Is Coming [Forbes]

Oh, look. It’s another one.

Anyone who has ever been to an industry conference like this knows that this is ALWAYS the reaction. The early afterglow is always some variant of “Wow, for the first time, we are finally speaking the truth about what’s going on in our industry! What a change from all the old conferences where it was just more of the same.”

Every industry’s conferences are exactly the same. Why? Because saying we’re going to do something in front of a group of people is how we give ourselves the moral license not to do anything.


The Zeitgeist – 5.16.2019

Most of the keywords that led to this article’s connections are in this paragraph. Just my opinion from looking at the narrative data every day, but it certainly feels like the sell-side and financial media drums are back to beating “value rotation.”

Tobias is one of those weird remaining ‘value guys’. We like him and wish him success.


The Zeitgeist – 5.16.2019
The Zeitgeist – 5.16.2019

Four things:

  1. Well, that’s reassuring.
  2. Remember, ‘according to several administration officials’ means ‘intentionally leaked by the White House.’ Why am I reading this NOW?
  3. “Clerical-led” and not “cleric-led?” That turn of phrase feels bad in the brain and worse on the tongue.
  4. Life imitates the Simpsons.

I usually find these “if you miss the 10 best days” pieces a bit tiresome, but the core idea here is right. For most people, betting on the non-existent odds of a game of chicken would take the form of selling, and going underweight equities vs. their long-term allocation or policy.

We’ve been suggesting that’s the wrong idea since December, and we’re still suggesting that overweight or underweight bets driven by trade and tariffs views are little more than a flip of a coin, with a seller taking on a negative expected payoff to boot.

What would make us start to re-examine that? Signs of explicit messaging that the Trump administration views crashing the tractor / going off the trade war cliff as an acceptable outcome in service of another (i.e. political/electoral) game. The characterization of the trade dispute as a matter of national security, something we’ve seen some seeds of in the last couple days, is one way that could take place.

Rusty Guinn
Executive Vice President of Asset Management, Salient. Rusty Guinn is the executive vice president of asset management at Salient. He oversees Salient’s retail and institutional asset management business, including investment teams, products, and strategy. Rusty shares his perspective and experience as an investor on the Epsilon Theory website.

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