Tuesday, October 12, 2010
Obama: Um, remind me- do I work for you or do you work for me?
Bernanke: Well Mr President, we both work for the same entity.
Obama: You mean the American people, of course?
Bernanke: Um.. sure if you like.
Obama: <chuckles> You're a good man, Ben.
In the world of journalism and news gathering, there is basically two kinds of leaks. The first, conjures up images of inquisitive reporters hungry for the truth, hunting down leads and deciphering fact from lie, as informants come out of the woodwork to 'leak' out secret and classified information i.e. Woodward & Bernstein uncovering Watergate.
What is far more common and employed especially by the finance arm of government (Fed, Treasury, etc..) is the intentional leak. While government wants to enact the policies it wishes, solely with investors' benefit in mind, it does not want any market volatility. So it will float out trial balloons to see how investors react. For example, its an unfortunate given that Bernanke will be printing and dumping another half a trillion into the system after November's Fed meeting, which will devalue the dollar even more than it is currently. Investors, speculators and all those who epitomize greed are happy with this. China is most definitely pleased ("China’s stocks rose, capping their best two-day advance in a year, on speculation the yuan will extend gains and possible U.S. economic measures will weaken the dollar and make commodities more attractive"- BusinessWeek, Oct 11 ).
So the stimulus is being priced into the market over a period of time prior to its reception- this spurs artificial confidence and pushes the lie of 'recovery' Now, let's say these same parasites were claiming that $500billion was not enough stimulus. The Fed would then be able to increase its figure prior to the release of funds and everyone in Wall St. would be happy as clams. And because the intentional leaks are done over a period of time, it gives the public time to grumble and forget about it before policy is enacted.
~ The life of a 21st Century journalist is Good ~
Now to understand how intentional leaks are so common and why the populace is so poorly informed, you must understand how deeply lazy journalists are in this digital information age. It used to be a journalist hunted down and acquired information. Now those people sit and wait for the information to be provided to them.
A financial reporter doesn't spend his/her time hunting down key figures in the Fed to probe into additional stimulus. The person sits at their desk, or home in their pajamas and gets a call from someone in the Fed who relays the information. Then the writer takes that information, adds 4-5 paragraphs of backstory or other fluff to fill space and feeds it to the public like a good puppy dog for the system.
Assuming that person works for a major news outlet like AP, Reuters or New York Times, that information is then sent to thousands of other newspapers, big and small, who are too cheap to hire their own reporters. They take the 5-6 paragraphs- condense to fit around the ads and crossword puzzles, and now you have a populace informed of an intentional leak cloaked as an actual 'news story'. Because it is far cheaper to pay AP or Reuters a fee for access to their wire service, TV stations, big and small, also access this information and use their budgets to pay perfect looking people $100k/yr to read you the wire services' stories of the day.
So what you end up having is government propaganda disguised as news and completely devoid of analysis, policy debate or causal effect. Its just one empty piece of information after another- certainly not as exciting as a football score or some affair a celebrity had. This is the world we live in- and you're part of it.
Posted by Susquehanna at Tuesday, October 12, 2010