Quote of the Day: Beware the Media, and the CEO, Narrative

Back in the day, when I made myself available for one-off television spots, I would often find myself frustrated when, in a recorded interview, on, say, a topic like minimum wage, I felt that I made some very important points that were counterintuitive for most folks and, therefore, important for them to hear. My frustration would come when watching the edited version on the evening news: So often my (to me) pithy points were completely cut out, as it was clear that the producer had his/her own message in mind and, therefore, would include only my words that seemed to support that narrative.

In case you’re wondering, I came to the conclusion some time ago that making a public declaration on my market view in a media that I had zero control over, on any given day carried with it the risk of misinterpretation and/or a viewer taking and running with it when it may have very well have been transient (i.e., temporary and subject to immediate change).

Not that I completely shun full-length interviews or speaking engagements these days (still end up doing two or three a year it seems), although I limit them to events such as business conferences, associations’ meetings, and the like. 

Research firm Bespoke Investment Group opened their weekly commentary with the below. I found it to be so illustrative of how the press too-often manipulates “reality” to fit the self-serving message their publication, or their sponsor(s), promotes:    

emphasis mine…

“What’s it like around there? Are you allowed outside?”

A year ago this week, Emmy award-winning New York Governor Andrew Cuomo made headlines when he announced that he was declaring a one square mile portion of the city of New Rochelle, NY as a COVID ‘Containment Zone’ and would be deploying the National Guard to the region.

Given the proximity of our offices in Harrison, NY to the region of the country’s first ‘Containment Zone’, we received inquiries from clients around the country asking us what it was like. When we told them that the only difference between life before and after the declaration of the containment zone was that schools and churches in the area were forced to close, they didn’t believe it. Compared to the numerous stories showing pictures of military vehicles in the street and boarded up stores, they were under the impression that the entire area was under martial law.

But the National Guard wasn’t deployed to occupy the city of New Rochelle. They were assisting at a newly set up mass testing site and distributing meals for lunch programs at schools that were forced to close by the governor’s order. And the boarded stores shown in press accounts? They were all businesses that had already been closed for months if not years before anyone had ever even heard of COVID. Remember, even before COVID the environment for brick and mortar retail was challenging at best, and many independent stores had already surrendered to the onslaught from Amazon and other large retailers with an online presence. It’s why we launched the Death by Amazon Index years ago!

Other than the church and school closures, there were no other restrictions in place and all other stores and business in the area were free to remain open. Don’t get us wrong. Just like the rest of the world, COVID ultimately had a major impact on the area, but the picture portrayed by a number of initial press accounts of the containment zone was far different than the facts on the ground.

Besides this week marking the one-year anniversary of the original declaration of the Containment Zone, what’s the point of this story? It helps to serve as a reminder to investors that not just during periods where conditions are fluid, but also in calmer times, reports you often hear are not always correct and are often slanted by a narrative of the person reporting the news, giving advice, or looking to close the sale.

If a reporter is looking to report that a city is under military occupation, they are going to show pictures of military vehicles, empty streets, and images of dilapidation. Similarly, a CEO doing the media rounds will probably only highlight the positive aspects of the business while leaving out the lagging units or a pending legal issue. When you’re looking to buy a new appliance, the salesperson could very well be leaving out the fact that the commission on the dryer they are trying to sell you is higher than on the cheaper higher quality option in the back of the store.

As an investor, it’s important not to act solely on the actions and information of one specific source. You should always gather as much information as you can in order to confirm or dispel a given narrative…”

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