Wednesday, June 1, 2011

There they go again...CNBC serves up a diet of opinion masquerading as fact

I am sitting here listening to a raging debate on CNBC that is taking place among a panel of "analysts" including Steve Lieseman and Rick Santelli and the rest of the CNBC morning crew.

They are beside themselves with incredulity because they just can't come up with an explanation for why, despite "all that the Fed has done," we're seeing the economy enter into a new round of weakness. Simon Hobbs, the CNBC anchor and Santelli, are throwing around phrases like, the Fed has put the "pedal to the metal" and it's given [the economy] "the best medicine," but it still hasn't worked.

You can see the frustration etched in their faces like a cast of bad actors in some kichy 1960's Godzilla movie after the military has unleashed its most powerful bomb only to see the creature emerge from the mushroom cloud without so much as a scratch.

How can it be that such an important purported "source" of economic and market insight is so absolutely clueless and has it so wrong? (Okay, excuse me for engaging in self debate.) Of course I know the answer; it's obvious. It's simply indicative of the entire realm of business media and mainstream economics, which is just completely out of paradigm when it comes to an understanding of how the world works.

More disturbing, however, is the fact that it reeks of an "in your face" arrogance that let's you know in no uncertain terms that you'll be served nothing more than a strict diet of opinion and myth, which you'd better take as fact because that's all you're going to get.

So the Fed's actions have not helped the economy? Wow, what a revelation.

How about this: Zero mention of the fact that Quantitative Easing or the setting of interest rates (the Fed's sole tool) does nothing to increase aggregate demand.

Zero understanding of the fact that Quantitative Easing and other interest rate measures have stripped nearly $150 bln in interest income from the private sector in the past two and a half years.

Zero mention of the fact that the Government, which HAS the ability to support demand and create jobs, is now pulling back in an economy that has been struggling with high unemployment and a large output gap for several years.

Nothing. No understanding of this; no care or concern or even the slightest desire to explore these concepts. Zero.

Consume this media at your own risk and don't wonder, as I often do, why we're in the mess we're in.


Crake said...

Is the ignorance too big to fail? That is the question.

Anonymous said...

Government can't create jobs. If they could we would have 0% unemployment.

Roll eyes.

Crake said...
This comment has been removed by the author.
Crake said...

Can CNBC et al just spend 10 minutes reading: