We hit only one of our two big milestones yesterday. The winter solstice passed, as expected. For the next six months, the days will get longer, not shorter.
The stock market, though, did not hit the Dow 20,000-mark we were looking for.
But wait. What is the Dow? Is it a proxy for the stock market? Not at all. It is a price-weighted index; it magnifies the importance of just a few stocks — most prominently Goldman Sachs.
Looking at a breakdown of the 30 ‘industrial’ stocks included in the index, we see that Goldman has a greater weight than JPMorgan, Coke, Intel, Pfizer, and GE…combined!
What kind of ‘news’ is this? It’s not an indication of how well the market is doing, but how well companies like Goldman Sachs are doing.
Yes, dear reader, it’s all fake. Fake money. Fake interest rates. Fake news. The US dollar is real. You can use it to buy things. But it is fake money based on fraud. It is more like counterfeit money than the real thing. Likewise, the news records real events. They happen. But they are often based on fraud, delusion, and misconception…not to mention myth and wishful thinking.
Life is always lived in the dark, as Lucretius might have said if he’d thought of it. But in the old days, at least the ground was free of banana peels and booby traps laid out by the feds and the press.
News is a modern invention. So is large-scale democratic government. The two go together.
The elite still rule, just as they always did. But now they are able to manipulate the masses largely by controlling the public narrative; that is…the news.
For hundreds of thousands of years, humans and proto-humans had only their eyes and ears to inform them. They looked, they listened…they watched. They drew their own conclusions.
It wasn’t until the 19th century that cheap newsprint made it possible to provide what we know as modern news.
But we still don’t know what to make of it. We’re not adapted to it. So we treat it as though it was the same quality as the information we get from our own eyes and ears.
‘It’s in the paper; it must be true.’ We take it as fact.
But what is it?
A gazillion atoms collide every day. The news only concerns a tiny fraction of them, such as the collision of the bullet coming out of an off-duty Turkish policeman’s pistol with the body of Russian Ambassador Andrey Karlov.
But these few bits of information are chosen as news not because of the real facts — which isn’t much different from any one of thousands of other collisions — but because of the factish circumstances, the part of life that only exists because of the imagination.
Remember, there are real facts — things that happen no matter what we think — and there are facts we bring about ourselves…based on myths, ideas, institutions, prejudices, follies, and foolishness.
We create governments…and then the news tells us what they’re doing.
We invent sports…and then the news tells us how well our sports heroes do.
We build businesses…and then the business news lets us know what they are up to.
All of this happens in the public space, which didn’t even exist until recently…and has no existence even today beyond what our beliefs and gullibility permit.
If we stopped caring about football, for example, the Super Bowl would vanish.
If we denied the validity of elections, there would be no votes to tally.
If we gave up on investing, the Dow would disappear.
And if we refused to recognise states, and their ability to meddle in each other’s affairs, the cop would have had no reason to kill the ambassador in the first place.
Do you see where we’re going with this, dear reader?
You do? Well, maybe you can give us a hint! We’re not sure.
For Markets and Money
Editor’s Note: The Port Phillip Publishing offices will be closed for the holidays. Alongside Bill, we’ll be returning on Tuesday, 3 January 2017. To tide you over until then, we’ve prepared a special ‘Best of 2016’ series that will run from Monday, 26 December to Monday, 2 January 2017. We hope you enjoy it.
From the Archives…
The Upside from Australia’s Coming Credit Downgrade
By Greg Canavan | 20 December, 2016