Clown Talk
The Circus Is in Town
I came across the meme above just the other day, and it hit home, as I didn’t even get my promised 2% raise last year. And I both work for the City of New York and am in a union that consistently takes its dues, loves to ask for my support, and constantly assures me that it is fighting for me. (Plus, New York was a massive beneficiary of the COVID bailout.) This should all make me feel safe and warm inside even when it doesn’t get my employer to deliver what it says it will, right? Clown talk.
Clown talk seems to be everywhere these days. One place in which it seems to be particularly ubiquitous is the in the mainstream media. Let’s take a look at some Emmett Kelly-level writing and editing from a media outlet seemingly staffed with big-shoe-wearing pundits whose hair is the same color(s) as their company’s logo.
You’ll notice that the Tweet, “Inflation’s silver lining: higher salaries” is different from the title of the piece, “It’s not certain rising wages will be enough to outpace inflation.” But this wasn’t always the case. At the time that this article was originally published, something closer to the Tweet was actually the title of the piece. See below.
From what I can tell, CNBC was literally cyberbullied into changing the headline. That’s what the Internet does to you when you write clown headlines.
But what about our major institutions? There have to be some people that are a part of those who don’t talk like clowns, right? What about the heads of the Fed or the U.S. Treasury?
The following are quotes featured in Jeff Booth’s The Price of Tomorrow:
May 17, 2007
“We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”
-Ben Bernanke, speech in Chicago
January 10, 2008
“The Federal Reserve is not currently forecasting a recession.”
-Ben Bernanke, interview with CNBC
October 28, 2008
“The downward trajectory of economic data has been hair-raising. It is becoming abundantly clear that we are in the midst of a serious global meltdown.”
-Janet Yellen, Federal Reserve transcripts
Turns out they speak clown fluently, as well. What a shame.
But what about good ole Joe Biden and his staff at the White House? We’re all done with having clowns like the guy below (ill-fitting clothes and all) in the White House, right?
Let’s see.
Well, Dan Price (the CEO who significantly cut his own salary so that the minimum salary at his company could be $70k/year) disagrees. And when the White House tries to put out bullshit propaganda like the Tweet above, I disagree, as well. This isn’t exactly the same type of clown talk that Trump employed, but it’s still the type of stuff that people who wear big red noses at children’s birthday parties say.
The truth is that talking like clowns is now the norm, because if the powers that be didn’t talk like clowns, there would be an even greater demand for antidepressants. We’ve seemingly come to love clown talk, as we need to hear it to distract us from what’s really going on.
Some of the most misleading clown talk out there is around inflation whenever Consumer Price Index (CPI) is used as the metric to measure it. Investopedia actually does a pretty good job in explaining why CPI isn’t always the best indicator of inflation. Forbes was more direct, though, in the article “If You Want to Know the Real Rate of Inflation, Don’t Bother with the CPI”. Some highlights from this Forbes piece include the fact that the Bureau of Labor and Statistics (BLS), the institution that calculates CPI, “operates under a veil of secrecy” and that “the raw data used to calculate the CPI is not available to the public.” From 1984 until 2014, the BLS changed the way that it calculated inflation over 20 times. Let me explain why they did/do this. To calculate inflation, you look at the prices of a “market basket of goods”. This basket of goods may include anything from housing prices to the price of oil to the price of beef. Given that we do not know what raw data the BLS chooses to include in its basket of goods each time it calculates CPI, the institution can juke the data however it likes. In other words, maybe all of the stats in the government propaganda Tweet above are true, and so the BLS says, “Okay, great. Let’s throw a whole bunch of those items into the basket of goods that we will measure. And, you know what, let’s leave out the current cost of housing, college tuition, and medical care.”
And voila! The rate of CPI is whatever the BLS says it is. So, why are they saying it’s about 5.6% right now, when maybe they could argue that it’s even lower? Well, given that the Fed recently printed about 40% of all U.S. dollars that ever existed, I’d imagine that they have to make the number seem at least semi-believable. In essence, here we have both clown talk and clown tricks at play.
So, that’s about all of the commentary I have on financial clown talk for today, but I wanted to throw in a little bonus clown talk for you. This clown talk comes courtesy of The New York Times. One of its writers (my guess is that its Ronald McDonald writing under a pseudonym) was recently wondering if more people voicing their opinions via newsletters is bad for democracy - you know, a clown question.
In all honesty, there were actually a few good points made in the article above, but the headline was simply designed to be heckled. Thank God for clown talk editors on Twitter.
The below, though, is a step beyond even regular clown talk.
That’s Pennywise from It-level clown talk.
So, please stay mindful that the circus is in town, and that the clown rhetoric will continue to abound so long as the truth remains too painful for us to stomach.
Best,
Frank
Twitter: @frankcorva
P.S., More on what I think is happening in digital asset markets in the next newsletter.
P.P.S., I don’t necessarily completely agree with the sentiment in the following meme, but I still love it, and I’ve been there with certain jobs I’ve worked.
Nice one 👍 Thanks, Frank!
Yep - clowns everywhere. My only relief is to disassociate from society, because it’s basically a clown show in total - fashion, music, art - all made by clowns for clowns really. I guess politics is just where they try to make the clown show serious - doesn’t really work.