Wednesday, October 24, 2012
Today the financial blogosphere has lit itself up with some introspective self-illumination as to what is happening within the structure of the financial blogging space.
Abnormal Return's Tadas Viskanta kicked it all off and has obviously twanged a nerve throughout the community as the marvellous Josh Brown picked up on the theme , Felix Salmon then wrapped up those 2 posts and others are joining in.
Team Macro Man, for their pennyworth, cast their vote behind Josh's Third theorem of Financial Blogging evolution.
"My third theory is probably closest to reality, though:
3. Many bloggers have simply been so completely dead wrong about the post-crisis period we've been in (Hyperinflation! Depression! Social Unrest! Hoard Water and Dry Goods!) that they simply have no audience left. Keep in mind that many of the 2008-2010 generation of bloggers were misanthropes who had been rooting for a collapse all along. They came out of the woodwork and began blogging motivated by a mixture of I-Told-You-So schadenfreude and the desire to predict the next crisis, which was obviously an imminent thing. Only it didn't happen (I know, I know, any day now). And having blown all of their personal credibility on failed Cassandra-ism, having recognized what a horrendous disservice they've done to those who've heeded them, they've simply moved on. Many went to Twitter instead where there is a less permanent record of their bullshit.
It should be noted that we witnessed this exact same exodus in 2007 and 2008, but during that period it was the more bullish bloggers and stock pickers that disappeared. They too experienced this sense of guilt and purposelessness when the wheels fell off and all of their investment ideas became humiliating at best and dangerous at worst. Inevitably, the wheel will turn again and the doomers (along with their blogs) will make a comeback. I look forward to it - those bloggers are far more fun to read than today's Apple-worship crowd."
But TMM would like to add their own metric to the calculation. The actual interest out there in all things financial to the non-financial folks who only become marginal financial folks when there is a buck to be made, a trend to be followed or a disaster or boom to be called. When things flat-line they swiftly retreat back to the real world. We have long held that our readership figures and indeed comment count, are highly correlated to bearish disaster markets. This accounts for the disasternista blogs and followers that Josh alludes to and certainly our trend towards bullish views over the past year seeing a fall in readership. We have long felt that the blogosphere is an environment where readers go for substantiation of their own prejudices, "free money" ideas, self-promotion through comments, humour and finally for intellectual self-improvement.
So what has 2012 given the reader? A year of stalemate between bull and bear, a year of no bust and no boom and a year of flat returns (yeah, yeah OK apart from you dear reader, we know you've done really really well through genius etc etc). But really, if you are a disasternista you have retreated to Zero Hedge's citadel, the bulls have retreated to regular bank research where, excepting the showmen "Albert Edwards" of this world, there is a tendency towards positives and everyone else who was being kept interested by the high octane of the past has basically wandered off to pursue their proper jobs. Lucky buggers, as some of us are left HAVING to scratch a living in the drying pond of finance.
And have the markets been tough? Yes. And are the men in the middle feeling the pinch? Yes. And is it just coincidental that the outbreak of introspection is not confined to the financial blogger but is being expressed right across the field of finance? Here is a very interesting take from the inside on FX.
So if the markets are rubbish and the readership is losing interest then why carry on? Everyone has their own reason but as far as Team Macro Man go we have had our doubts as to the worth of why we are doing it and have been through our own period of introspection.
We took on the role after being asked to keep the flame of Macro Man alight as the original had to depart the blogosphere due to a reason not quoted elsewhere - Employer restriction (it is worth considering this function as a filter bias towards the type of folks that do actually blog). We were hugely flattered to be considered for the role as none of us had any experience in public writing and it was a huge challenge, but the ethos of writing to test one's own ideas in a forum has always been key and has indeed been very useful. As long as you have some. When we started, ideas were coming as thick and fast but this year has seen long periods of us just riding old themes and yes, post frequency does suffer. Unlike a newspaper that always have to have something on the front page no matter how trite, we can just not publish.
However it has been tough and we have been pretty close to calling it a day this year as the other great pressures we have in our day jobs dominate. When times are hard work has to take preference over the hobbies. And as a non-profit non-advertising blog, this really is a hobby.
In summary, we don't think the introspection of the evolution of the financial blogger is a one off. It is more a symptom of a general introspection the whole financial world is feeling in the face of a rapidly changing environment.
However, Team Macro Man will keep plugging on.