A Canadian Rant and other Observations

A Canadian Rant and other Observations

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Keith Richards, August 14, 2023 (from his excellent investing blog)

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As investors, I have often shown you (through this blog) how online and legacy media tends to deliver a popular message regarding the markets or individual stocks. Typically, the headlines are delivered with poor timing. You know how it works. The media starts talking about the cannabis industry, or bitcoin, or AI, or oil, or whatever. That stock or sector has been moving, and we are told it is going to a) go up a whole lot more …or b) go down a whole lot more. Typically – right before the opposite happens. In fact, I’ve pointed out some tools – such as the Google Trends tool, to quantitatively track this tendency.

Yes, folks. There is bias, and crowd behavior in the news. So I start off with skepticism when it comes to what the media reports. Recall how legacy media delivered the “governments transient inflation” argument back in 2021. Recall the media’s message of the bull markets return only half way through last years bull market?

Adding to my skepticism regarding ANY media reporting has been Canada’s government funding of heritage media outlets. That, and recent Bills for controls of media content ranking (heritage media and internet) and access. While this control doesn’t always affect stock market news (although it can, via inflationary or economic policy reporting bias), it certainly affects issues surrounding freedom of speech, choice, and access to unbiased information. So, you will have to endure a rant today (most of y’all tell me you love my rants anyway) before we get to the charts. OR … just skip this next part. Your call.

BTW –fun fact—my marketing data company shows me that I get more hits when I rant, so I ain’t stopping.  Sorry to individuals who wish to keep their heads in the sand on the policies of Canada’s most hated PM in history. As an aside – way back on December 23, 2015, I wrote my very first political rant–warning readers of what was to come with a high level of accuracy (contrarian call against his massive popularity at the time).  I got a lot of pushback. My how things change – he isn’t so popular any more. I have always felt it a duty to say something, even if its contrarian at the time, and it is gratifying to see others starting to see the light.

“The antithesis of courage is not fear. It is compliance”– Clyde D0-Something

The rant part

One of the key strategies by communist, fascist, dictatorship or elitist governments is control of the media. For those interested in the subject, you may want to read the classic “Rise & Fall of the Third Reich” to witness the steps towards fascism in Germany during the late 1930’s. While we are a far, far distance away from becoming the next Nazi state, there are similarities of strategies happening here in Canada you may be shocked by after reading the book.

For starters: Fascist governments dominate the media landscape through the national television networks, radio and print outlets – either directly or through state-owned enterprises or friendly/ funded business magnates.  Stop me if this sounds familiar, fellow Canadians.

These days, media is largely on the internet. Witness higher levels of internet censorship in countries with high levels of media state ownership such as Russia, Singapore, Belarus, Myanmar, Ethiopia, China, Iran, Syria, Turkmenistan and Uzbekistan.

Off topic, but Trudeau’s government are also notorious for appointing acknowledged Liberal supporting judges and “special rapporteur’s” – another comparative taken out of Hitler’s rise to power (who appointed sympathetic judges early in his political career). That’s a fact.

Anyhow…

Canada’s Bill C-11, Bill C-18 echo anything, fellow Canadians? As a refresher:

C-11: Trudeau’s Heritage Minister Pablo Rodriguez believes that unregulated speech “erodes the foundations of democracy.”

Unregulated speech erodes democracy??? Actually, this bill empowers government regulators to censor user-generated content. It curtails what and how you see and say things. Recall the blocking of anyone posting online questioning COVID shots, lockdowns, masks in 2020-21 by some social media platforms. Opposing views on these platforms were incentivized to censor  by government. Eg- The US Biden administration has recently been challenged in court successfully by doctors who have been critical of state and federal pandemic-era restrictions, and others who were censored for online criticisms of Covid health measures.

Using C-11 in Canada, The CRTC is to set content promotion and demotion rules (key words!). These rules  effectively push search engines towards government initiatives (ESG). It requires more emphasis on Canadian content (even if that is not what you are looking for) and requires platforms to make financial contributions towards Canadian content.

C-18: This bill is attempting to force social media platforms to pay legacy media for content. Free content has been used as a marketing driver to generate ad revenue (click bait) or paid subscriptions in the past. Just like this blog, where I offer free content in the hope that I gain market awareness and in the hope that some people may want to do business with ValueTrend. This is modern era marketing.

The problem with C-18 is that it gives the government the power to regulate who gets to post their articles – aka, which expression is worthy of payment. Will the Free Press with non-party views be “allowed” to post & pay? In doing so, it creates a threat to freedom of expression for all Canadians.

Beautifully ironic: Apparently, Trudeau’s Bill C-18 has been backfiring as Meta has refused to pay his “Qualified Journalism Organizations” for their content. I am hearing that Meta has only been posting content by the Free Press – who typically do not promote the party line!

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“Two things are infinite: the universe and human stupidity; and I’m not sure about the universe.”– Albert Einstein

Coming soon to a Canadian theatre near you…

 

There are three levels of media influence by government in Canada.

Government owned

The elephant in the room is obviously the state owned CBC, costing taxpayers well in excess of $1 billion. Opposition leaders have vowed to defund the CBC. Think of the CBC executives and staff…Pretty hard to be politically unbiased – what with an opposing government who will pull the funding.

Don’t ya’ think?

Government funded

By handing nearly $600 million directly to “select media outlets that obtain the federal government’s approval”, the Liberal government has been building support through “friendly” media magnates. Tell me, what are the odds that these “Select Media Outlets that meet Federal Approval” will  continue supporting the regime giving them this money?

I’d guess the odds are about 600,000,000 – to 1.

Government supported

“Andrew Coyne and Paul Wells argue that if the government starts to pay our bills, we will inevitably start to suck up to governments, or at least to government,” said Maher. “I’m not so sure…An awful lot of our media is already subsidized, either directly by government, like news magazines, or through CRTC-mandated cable fees and industry funds, like TV news.”

Western Standard notes: “Even those not directly hired with a large grant in the print business will owe a large portion of their take-home pay to the federal government. The Journalism Labor Credit allows the Orwellianly-named “Qualified Canadian Journalism Organizations” to apply for a 25 per cent refundable tax credit, with a cap of $13,750 per employee. This puts even credible and reputable reporters, columnists, editors, and publishers in a massive conflict of interest.”

Question: If you were a journalist in one of the Liberals’ “Qualified Journalism Organizations”, are you going to write with a positive bias of the current government? Or will you write unfavorable stories, risk it’s re-election chances, and watch those juicy tax credits disappear?

Just askin’.

Free press

This sector is growing, as the growing frustration and awareness of an agenda-biased heritage media by Canadians has expanded. The chart below was put together by Western Standard in 2020, with new names like True North and many online free press agencies missing. No government funding here, and no love lost by the Trudeau administration, who prefer to squash those who might dissent.

 

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Source

https://www.valuetrend.ca/should-you-own-legacy-media-stocks/#comment-10568