It is often stated that truth is the first virtue lost in truth and war. The question today is what is truthful? Is the next data point truthful?
It is widely accepted that the establishment of the internet slowly increased the flow of information than suddenly overwhelmed all with a massive increase in volume.
According to Martin Gurri, in his book The Revolt of the Public, Gurri writes “in the year of 2001, the amount of information that was produced doubled the amount that was produced by the entire human race from the cave paintings and the dawn of culture until now. 2002 doubled 2001 levels.
Wow! The implications are gargantuan. Tectonic is not a strong enough word. How do we process this information? What is true?
Perhaps the younger generation (born after 1994) is the most impacted by this information overload. The younger generations lack the experience, the wisdom, the discernment by the mere fact that there is no substitute like experience.
Psychology 101 dictates that individuals who have first-hand experiences have much greater wisdom and enlightenment than ones who do not and those who have had these experiences bristle at those who make dogmatic statements based upon something read on the internet.
The internet is a great echo chamber as anyone can declaratively post [mis] information and sound authoritative. The internet also panders to our preconceived biases.
What does this have to do with the markets?
Everything. Markets are people and people move markets based upon preconceived biases. No one is objective and those who claim that they are, are perhaps the most subjective people.
We are in the midst of a nasty election. What candidate is truthful? What candidate has policies that will increase the odds of a strong economy and country.
Government does not create jobs or economic prosperity. Government creates polices that creates a conducive environment for jobs and economic growth
Meritocracy has created the greatest country the world has yet experienced. Based upon the Declaration of Independence, we are Endowed by our Creator with certain unalienable rights such as life, liberty and the pursuit of happiness. There is no mention of equal outcomes.
Yesterday’s data again defied preconceived biases. Job openings climbed to a three-month high, exceeding all expectations. The number of vacancies per unemployed worker, a ratio the Fed watches closely, held near a three year low at 1.1. At its peak in 2022, the ratio was two to one.
The ISM Manufacturing New Order Index also exceed expectations, an indicator of future manufacturing activity.
This data does not necessarily support a dovish Fed.
And then there is the Middle East. Recalling upon our Sunday School and high school civics class, it is a five-thousand-year-old conflict between the Children of Ishmael (Muslim) and the Children of Isaac (Jews).
Again recalling our high school civics class, the Children of Isaac are the Jews and based upon the neo colonist philosophy, the first rightful born male inherits all the father’s wealth. Isaac was the first-born legitimate son of Sarah, Abaraham’s wife. Jesus came from this lineage.
Ishmael was born of Hager, the slave of Abraham’s wife Sarah. Ishmael was illegitimate, was born before Isaac and is regarded as the Father of Islam. His later generations birthed the Muslim Prophet Mohamed.
If one truly espouses the Settler Colonialism or the Neo Colonists view, one will then support the Children of Isaac (Jews) as the true landowners.
There is ample dogma on the Internet suggesting the opposite…that the Muslims by ancient law were the first to inhabit the Middle East and thus the rightful landowners, thus supporting today’s neo colonist position.
Iran, which are Shia, launched “hundreds” of missiles at Isreal and are perhaps threatening the closing of the Strait of Hormoz. Isreal intercepted the vast majority, the attack generally a market nonevent offering incredible sensationalist headlines and images.
As noted many times a war premium is absent in the markets. Will one suddenly arise, perhaps an October surprise?
It is often written that the Victors write history. That one’s reality is not necessarily another person’s reality.
The internet offers so many different versions of reality. The question is which one is correct?
Yesterday offered conflicting views as Treasuries rallied on the ISM data but equities sank on the Middle East.
What will happen today?
Last night the foreign markets were mixed. London was down 0.06%, Paris up 0.16% and Frankfurt up 0.01%. China was up 8.06%. Japan down 2.18% and Hang Seng up 6.20%.
Futures are flat as the markets are pondering the next possible steps by Isreal, the impact of the port strike, the upcoming unemployment report and the commencement of third quarter earnings season. Oil is up about 3% to over $72/barrel. The 10-year is off 7/32 to yield 3.77%.
