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Prejudice in the News

October 18, 2010 – 5:46 pm

This morning the government reported September’s industrial production and capacity utilization numbers. Both were surprisingly down a little when they were expected to be up a little. The market did not react and in fact it seemed the news media ignored the reports altogether. I find it interesting that the media will ignore important facts and dwell on unimportant facts at its whim. That tendency should tell you that they are interested in ratings, focusing on facts or stories that will capture the public’s attention but may not be important for serious investors who are trying to ferret out the weaknesses and
strengths of the economy.

Tonight after hours the financial news media will focus on Apple’s earnings because Apple is a leading edge tech company and maybe because of that they should focus our attention. On the other hand IBM is also reporting as is Halliburton, Citigroup and many lesser known names. You won’t hear much or anything about the lesser names but they too are important. If you want to understand and gauge the strength of corporate America look at all the industry leaders not just tech, banks and builders which have been the focus of the news media.

Therefore, go ahead and pay attention to the leaders such as Apple and Google but they only tell you part of the story. Pay attention to the rest of the earnings story. We will get a large part of that story in the next two weeks.

Good Trading
Steve Peasley

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