It is a holiday so just a fun post.Yesterday Arianna Huffington was on CNBC and had an old fashion slap fight with Larry Kudlow. She was on because of this article from the Huffington Post about taking money out of the big banks and putting it in community banks. Shout out to my buddy Kirk Kinder for pointing this article out before the CNBC segment.
Larry didn't think much of Huffington's idea and Huffington almost immediately went after Larry's track record for being a perma bull and while I am not sure it seemed like it may have caught Larry off guard. Then she came back at him in a second segment with a quote from the Wall Street Journal from 1999. It did not appear that Kudlow called for Dow 50,000 like she said in the first segment but he did say that Dow 10,000 would be a small blip.
Kudlow's defense, in part was that he has always been pro-American and a free market capitalist and he criticized her for flip-flopping from a conservative to a liberal. Poor Brian Shactman was in the middle trying to keep both segments on track.
Well I do not know Huffington's politics but Kudlow's defense (and again I think he may have been caught off guard) seems to imply that patriotism and objective analysis are mutually exclusive. If we assume that he truly believes every forward looking economic statement he has ever made then he missed the tech bubble and subsequent fallout and then completely missed the worst financial crisis in his lifetime.
I gave up on Kudlow shortly after the tech bubble. Morning Call is on at the same time as European Closing Bell (that show was not on yest) and I never watch his primetime show. I used to have to go to Phoenix more frequently than I do now and so on those days I would hear his afternoon show and back then he never saw the crisis coming. With what very little I saw of him in late 2007 and 2008 he seemed to not see it then either. I'm not sure when he finally threw in the towel (assuming he conceded at some point it was bad but not sure how late) but you can be patriotic and an objective economist.
Anyone actually taking his comments to heart could have been badly hurt by this financial event. I took from his reply to Huffington that he will never change his point of view so then if that is what he means then he is saying he will never be an objective economist and so never provide any sort of warning that trouble might be looming.
A point I have made before is that portfolios need to be protected from the things that Kudlow (and while we're at it Brian Wesbury and Jim Paulson) apparently cannot see. Portfolio's do not need protection from the bullish case of the day. There is always a bull argument and there always a bear argument and occasionally the bear case wins out and there is nothing un-American about it.My brother and I tried to get tickets to the Bruins game being played at Fenway today but we did not win the "lottery" to buy tickets. Should be fun to watch though.
I hope everyone has a healthy and Happy New Year!
10 comments:
Happy New Year
Larry is not that interesting, but how many people on daily are rather insightful?
The guest on various shows are the interesting part (hopefully)
Happy New Year, Roger.
Eddy Elfenbein has a post up that quotes Kudlow twice endorsing Dow 50,000 by 2020. Both are from 1999, so it appears that Huffington is right.
Personally, I gave up on Larry ages ago and now actively avoid him. He simply is not objective and delights in the shoving matches that CNBC tries to pass off as business news.
Heck, I still pine for Louis Rukeyser. While not an economist, he was patriotic and optimistic, but objective. His was a much better prescription for investment health.
the link to Eddy's post http://bit.ly/8bElEy
good stuff
Well, if you listened to the advice of Kudlow about a
"Goldilocks Economy"
and sold your stocks (bear)
and bought GOLD...you would
be doing fine...;-)
I enjoyed the "interaction"
between he and Huffington...
very entertaining.
Happy New Year everyone....
wondering what 2010 will
bring us.
Roger, please start your own
ETF with all the countries you
suggest.
I'm glad you brought this up, Roger. I used to listen to Kudlow on XM Radio a lot, but eventually was turned off by what seemed to me like a lack of reality-based commentary. Patriotism is not the same thing as cheerleading. In fact, it seems the whole idea of patriotism has been cheapened since 9/11/01. What passes for patriots these days are people with "God Bless America" magnets on their cars. It makes me sick, and determined to not fall into this contemporary definition of patriotism. Recessions, it turns out, are an integral part of the American way--they help to clean up the economic junk that has accumulated since the last recession.
Huffington's website is full of crap too, but in this case she was right about Larry being a permabull.
The better alternative to CNBC has become Bloomberg Radio. It's much more fact-based and cerebral in its discussions. Not sure where it's available outside of NY, but I get it on satellite radio.
PATRIOTISM IS THE LAST REFUGE OF A SCOUNDREL----Samuel Johnson
I admire Larry Kudlow for being true to his convictions. I do not follow his advice. He is a media personality now.
Arianna Huffington has whored her way in both personal and professional life from being the wife of a conservative Republican politician to her present position as "publisher in name only" of the Huffington Post.
I view this transplanted Greek socialist with a view my father taught me years ago:"She may not think her s--- stinks, but her farts give her away."
I agree with a previous post that Bloomberg is a more compelling, factual view than CNBC.
With that, Happy New Year to everyone, even Arianna.
T
T said it well
One of the investment themes of the 90's was that content providers were going to be the most profitable area in media because the medium itself, the pipe and gear at either end, were essentially commodities and would be priced as such. But content can be copied or stolen with greater ease than ever and, with margins beginning to shrink, those who spent a lot of money acquiring content will be lucky to monetize what they purchased.
OTOH celebrity is much more difficult to steal or copy so Kudlow, Huffington, and all the rest -- commentators, politicians, movie stars, CEOs, athletes, etc -- are playing exactly the same game in that respect: Ginning up their name (brand), building and maintaining fan base, accessing or controlling the news cycle, etc. That is what establishes the value of economic rents and the ability to acquire or extort those rents is what generates greater marginal profits.
I suspect this is one of the reasons that news, opinion, politics, entertainment, PR and advertising are increasingly difficult to distinguish from each other on the one hand but frequently tend to over-the-top extremes on the other; publicly available information can no longer be monetized unless it offers a way to increase contrast between yourself and those with whom you compete for rents.
Folks like Rupert Murdoch recognized this early and profited greatly but these days I suspect many recognize it at some level: Not just in the growing swamp of name calling, incivility and bullshit (made up facts) but in the ongoing search for honest brokers or in the way we miss public figures who seemed more worthy of trust (not that they always were of course).
Happy New Year
Up 55% in 2009
Sold some Asia and Emerging markets a few days ago and purchased QQQQ with enough left over cash to buy a motor home.
I would not have the current economic policies if I were in charge, but I am not in charge. So based on the policies of the people in charge I do not see this bull market ending tomorrow.
The dollar confuses me here, but I still love emerging markets and Asia, but Roger has convinced of the value of diversification. Not that he or I would substantiate that I was properly diversified. Still I may have to buy more QQQQ or IWM or IWN in the future.
Either way I think the bull continues even if we have been in a trading range for months. I guess the trading range takes the place of a proper correction which seem rather bullish to me.
SEG
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