The Dialectic of the News; or; The Niacin Press Process

As an admitted "news junkie" I have observed over the years that within minutes of adverse, negative news in the financial press, there is a carefully orchestrated release of stories of just the opposite persuasion to calm the waters.

If you click on the post, you will see an article by a reporter who is described as an AP business writer who tells you that the plunge of the Nikkei stock market in Japan is really no problem when one looks back to the history since 2000. This is really reassuring for the American investor who these days is heavily invested in international stocks.

If one reads the recent stories of the problem in Iran, and that Iranian finance ministers are pulling their money from the West in preparation to avoid a repeat of the problem they faced when the US froze the assets in the Jimmy Carter days, one can see that this is exactly what the US treasury does not need, folks moving money out of dollar denominated investments, and even worse, out of US treasuries. A full scale panic could cause interest rates to skyrocket. Bad for everyone.

The effect of the "niacin" press is to calm, and freeze investors. However, folks need to be aware of the risk of investment and not be frozen from appropriate action. When we are children, we might have adult folks place a hand on our shoulder and tell us "everything will be ok." When we are adults, we need to make up our own mind.