Media headlines, cliches, one liners and the market impact

[brty]

After reading a whole host of cliche's this morning I thought I would start this thread as a form of back reference for the future. In other words log the current cliche/headline and refer back to it later, looking at what type of signal the headline was.

Todays beautifull one-liners include...

Hold your nerve, it's time to jump in

The Age

With in the article is the following....

INVESTORS who bail out of shares now will be kicking themselves in two to three months' time

share prices are now attractive and that this is a buying opportunity

Investors will be kicking themselves if they don't pick up some bargains at the moment,

This is not a time to panic

Please add others, as this could be a valuable resource of "the headline effect" if it is in fact true.

brty

 

[brty]

Here is another good one...again from The Age....

Buy stock now, ride second stage of bull market

I believe the rally will continue. The recent slump, in my view, was normal.

All in all, the evidence points to an enduring recovery, in my view.

brty

 

[Timmy]

In terms of the most recent upswing the quotes from the papers were pretty much on the money. You posted on a Sunday (were the quotes from a Sunday edition?) and the lows hit Tuesday. Depends on the time frame you would use to decide if the quotes were useful or not? The results may well be different in a months time, or not.

Also, those quotes appear to come from the sell-side of the industry, so may not be representative of sentiment, motivated as they most likely are by business generation rather than dispassionate (or passionate at times...) commentary.

And another thing ... (sorry to go on) ... should the 'headline effect' be applied to the front page of the general section, more than to the business/investment section (of course, I don't know where the quotes you quoted came from in the paper). I recall reading an article this week about the front page of the NY Times on Feb 5 (I think) warning of imminent equity market meltdown, or some such hyperbole ... will dig it up if anyone is interested.

Would it also be useful to apply the same assessment to social media - forums, FaceplantBook, MySpace, blogs, etc.?

 

[Krusty the Klown]

This thread could be an interesting record of the two up game of business journalists and economists.

Both always remind you of the 1% of the times they were right, and never mention the other 99% they were wrong.

 

[brty]

Timmy,

All good points. Please feel free to post from whatever source. I agree that up 'til now the headlines in "The Age" were correct, it was a good short term buy.

This thread is about finding the truth over the longer (or shorter if you like) term, with emphasis on the accuracy of the media. I don't think there can be any 'right' or 'wrong' from posters, just what we find published.

brty

 

[Timmy]

I dug up the front page of the NYT from February 5, the day of the bottom of the recent 'correction' (for the S&P500, at least so far...).

It comes with this less-than-helpful disclaimer:
To reduce download time, this page has been scanned at a resolution that makes the headlines and photos legible but not the body type.
i.e. good luck reading it ....
http://www.nytimes.com/indexes/2010/02/05/pageone/scan/index.html

The headline I refer to is:
Markets Routed As Worry Grows On Europe Debt
(top of sixth column)

Here is the actual article link too:
http://www.nytimes.com/2010/02/05/business/05markets.html?scp=2&sq=february 5 2010&st=nyt

 

[Timmy]

This one might be interesting to monitor. Article in the WSJ today (Fri. Feb. 26) and widely reported on other MSM sites, as well as various blogs.

Hedge Funds Pound Euro

 

[Timmy]

Article in the WSJ today (Fri. Feb. 26)
Hedge Funds Pound Euro

Just thought I would follow this up.
I thought this article was of interest as it appeared to give an insight into 'secret' meetings to drive down the Euro. Also the article appeared well after the Euro had already copped a substantial thrashing ... seemed to me to be a nicely placed article to perhaps facilitate some profit-taking by said hedge funds (or maybe I am too old and cynical ).

Well, about 2 weeks have passed and since the article's publication the Euro has done pretty much nothing, direction wise. Like I have said in this thread previously, depends on your time frame but given mine is about 90 seconds I figure nigh on 2 weeks is long enough.

Chart of the Euro, showing the prior thrashing, the date of the article (or thereabouts) and the action since:

Chart from http://www.dailyfx.com/charts/netdaniachart/

 

[brty]

Spooked investors desert jittery market

Sell it All, Risk of 'Major Crash': Dow Theory’s Russell

Angela's ashes: 'desperate' Merkel fuels slump in global markets

Plenty of negative headlines, yet in the small print I see the following.....

Locally, shares could open slightly higher this morning

Interestingly, the headlines from the 7th/8th February were accurate, the market went up for a couple of months.

The ones about the hedge funds pounding the Euro have also been accurate over the medium term.

brty

 

[baby_swallow]

I have a mechanical trading system in mind that trades against local media business journalists forecast. I refer the trade with the daily SPI. So far it has above break even win ratio. I think if I give it a bit of money management it can actually make me a nice living, LOL.

 

[brty]

baby-s,

Please feel free to add some you come across. This thread is only about how the media went in their calls, nothing to do with our own calls. Hopefully after a year or two we can build up an inventory of how right/wrong they were.

brty

 

[Timmy]

Yes, good thread brty.

I read a blog entry recently about how to use the 'headline effect' - i.e. under what circumstances headlines etc. can be used as a sentiment or contrary indicator. It was a useful article but I am annoyed with myself because now I can't find it to post up here.

I think it was on The Big Picture blog, http://www.ritholtz.com/blog/, but not sure.

If anyone can find it I think it would be useful here, at least as a talking point.

 

[Bushman]

Aussie dollar in freefall

 

[Trembling Hand]

Can we broaden the scope a little and add KRudds super tax to the top of the mining boom?

Just like Costello's future fund was unleashed in mid 07 to catch the bull that had already bolted.

 

[Timmy]

Here's one to hearten the bears, front cover no less.



http://www.ritholtz.com/blog/2010/06/reviewing-and-roasting-the-perma-bears/

 

[Timmy]

Here's one to upset the gold bugs...

Headline Reads: Uncertainty Restores Glitter to an Old Refuge, Gold

On the front page of the NY Times, June 13, 2010.

Link to full article:
http://www.nytimes.com/2010/06/13/business/13gold.html?ref=todayspaper

 

[Timmy]

Front page of the Sydney Morning Herald (18JUN10):

Property investors on top of the world
http://news.domain.com.au/domain/re...estors-on-top-of-the-world-20100618-ykbs.html

 

[professor_frink]

Took this screenshot going in to Tuesday night's open on the US markets:

http://www.realclearmarkets.com/



You'd think the world was coming to an end(still could I suppose)

The funniest one was this:

Contrarian Indicator Offers Bearish Picture

Can't say that it's much of a contrarian indicator if it comes after the markets have already taken a 15%+ haircut and we've just fallen for 9 out of the prior 10 sessions.

4 trading sessions later and we've moved up 5%+

 

[brty]

Here is something from today's Age newspaper...

Why our shares are ready to fly
RICHARD WEBB
August 1, 2010

THE stars are perfectly aligned for shares to rally hard to the end of the year, stock experts say.

Some are tipping the ASX 200 will reach 5200 points by year end, for a stellar gain of more than 15 per cent in the next five months.

One of the reasons given for "shares ready to fly" was the following....

The property market is showing signs of faltering, following the rise in interest rates at the end of last year to May this year. This led to the sharpest rise in mortgage rates (from about 5.15 per cent to 6.75) in at least two decades, according to Macquarie Bank interest rate strategist Rory Robertson.

History does not really concur with that 'reason'.

brty

 

[Timmy]

Front page of The New York Times, Sunday Aug. 22, 2010:


http://www.nytimes.com/indexes/2010/08/22/pageone/scan/index.html


The relevant headline reads:
In Striking Shift, Small Investors Flee Stock Market
The full article here: http://www.nytimes.com/2010/08/22/business/22invest.html?ref=todayspaper