I’ve been meaning to address this for some time, and today is as a good a time as any.

Over the years, I  have participated in interviews at Yahoo Finance — its always a fun time, Aaron Task, Jeff Macke, Henry Blodget, Dan Gross & Co. are very sharp guys. Its usually a short, smart interview with insightful questions and fun topics.

Then there are the Yahoo (almost message board) comments.

I cannot tell you what a wonderful tell — just top notch contrary indicator — these have been over the years. Check out Sucker’s Rally Alert: Dow Going Below 10,000 (Aug 12, 2008) — its too bad that when they redid the site, Yahoo lost the Incredibly Bullish comment stream, just as we were heading right into the collapse.

The opposite played out, on March 9th 2009: “Big Bear Market Rally Coming,” Says Noted Bear Barry Ritholtz (recorded March 9th webcast Mar 10, 2009 08:35am) The comments were incredibly negative to any sort of good news.

More recently, we did Bear Days of August Might be Over, Says Barry Ritholtz in September 2010, just as QE2 was ramping.  (These comments were not much better: House Prices Are Still 10% Too High, Says Barry Ritholtz).

Which brings me to this week’s appearance. 2 negative pieces, one positive

-U.S. Economy Right Where It’s Supposed to Be, Ritholtz Says

-Despite Falling Prices, Housing Sector Is Recovering. Really.

-America Is So Not In Decline: Ritholtz

You have to go read some of the comments — especially on the America Is So Not In Decline  — they are simply hilarious examples of cognitive foibles, selective perceptions, bias and just plain human silliness you will ever see. I tried pushing back on a few of them, but its a tide of ignorance, and I only have 2 thumbs to stick in the dike.

Read ‘em and understand why most investors under-perform . . .

>

Previously:
You MUST read the comment streams at Yahoo Tech Ticker (September 3rd, 2010)

Category: Contrary Indicators, Psychology, Really, really bad calls, Web/Tech

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

33 Responses to “Hilariously Ill-Informed, Shockingly Clueless, Cognitively Impaired, Ignorant Commenters at Yahoo Finance”

  1. techy says:

    Barry I have spent years debating with people on google finance (I could not attempt the same on yahoo its simply a mob rule), I do the same on seeking alpha where it is slightly better. But after all these years it feels like for 99% of the population financial markets are too complex to comprehend.

  2. Britonomist says:

    There’s bad commenters everywhere, zero hedge is notably full of insane doomsayers. Of course youtube still takes the prize as being the worst.

  3. Iamthe50percent says:

    It seems that 99% of commentators at Yahoo Finance are charter members of the Tea Party. Their ignorant views on Obama and Keynes are hilarious. They also seem to be in love with Ayn rand, but I repeat myself.

    How did America become a world power if these mouth-breathers are typical?

  4. Jack Damn says:

    I was looking at housing tonight. Nice run this week after the data on Thursday.

    - Dow Jones Home Construction Index (weekly chart):
    - http://chart.ly/297r79h

    Vs.

    - XHB and ITB year-to-date performance:
    - http://chart.ly/p4o8yka

  5. James Cameron says:

    > they are simply hilarious examples of cognitive foibles, selective perceptions, bias and just plain human silliness you will ever see

    Like this:

    Mr. Ritholz can’t see the forrest for the trees

    ? :)

  6. Arequipa01 says:

    I disagree with your viewpoint. You conclude that the future will be positive based on your recent experience in California (if you were honest with yourself, you would recognize that this positive attitude is due to a pisco afterglow). This conclusion is predicated upon a Singaporean fantasy that an authoritarian regime that dissolves the res publica and dismantles democratic institutions will produce the material conditions in which a robust economy can function. You are mistaken. Anything ‘those wonderful kids’ are doing out there will be assimilated. Nothing truly disruptive nor deflationary will be allowed. Hell, Chambers with a whisper in Obama’s ear stifled optical photonics for enough time for Cisco to play catch up. We all know that the debt will be placed squarely on the backs of the young, the old, the infirm and the poor. And the slaves will be made to dig us out of the hole. Meanwhile, Fascism in Michigan- where the trees are the right size. h/t Mitt ‘I got yer fudge right here’ Romney:

    http://www.freep.com/article/20120427/NEWS06/204270429/Emergency-manager-ballot-issue-rejected-now-it-s-headed-for-the-courts?odyssey=tab|topnews|text|FRONTPAGE

    ~~~

    BR: Um, no.

  7. bubbles says:

    America’s not in decline if you’re a supporter of Fascism.

    http://www.secularhumanism.org/fi/index.htm

    However; if you’re a believer in freedom, liberty and capitalism then yes, America is in decline.

    “Fascism is capitalism in decay” – Vladimir Lenin

  8. neddyj says:

    barry – i like to look at the comment sections for sheer entertainment, and this one (America is so not in decline) is a quality one. (the comments after sports articles are also particularly entertaining)

    maybe i’m a perfect example of the bearish investor being part of the contrarian sign that the market is headed higher – but i’m not sure a message board on yahoo, given the title of the article, is an effective contrarian sign. i think the message board as a form of communication is fertile ground for anyone who disagrees with the opinion shared in the article. (i also think that you find miserable doomsayers across the message board universe because it gives them a megaphone. they’re just louder and nastier than the optimistic crowd.) i doubt that you could post the same article with the market 1,000 points higher than it is now and suddenly find that the message board is a bullish happy place, the grinches would be there. If your article was titled ‘america is so in decline’ and you were calling for a much lower stock market (or god forbid, lower apple) – you’d probably have more bulls posting comments than this article, but the grinches would still dominate the chatter. (check out the comment section on the barron’s article about jeffrey gundlach calling apple a generational short – the apple bulls come out in full force and want to tar and feather the man)

    also – the political parties seem to be more polarized than ever right now. seemed like more than 1/2 the posts were anti-obama. maybe the message board was a contrarian sign that he’ll get reelected in a landslide election.

    i personally think things are bad now – though possibly improving, but not at a rate fast enough to help us escape from the next leg down. not predicting the end of the world mind you, just think the QE drugs that continue to be administered are finding that the patient has built up a tolerance. (bernanke keeping the door open for QE3 in the post fed meeting interview kept this market together this week…even that day the market looked like a junky waiting for his fix)….there’s no bullets left in that gun, but bernanke needs the market to believe that there are.

  9. willtruth says:

    I always read the comments area to see what people are thinking and what ideas/thoughts are floating around. Without a doubt, the level of frustration of the commenters is going into overdrive. People are not happy with what’s happening in the country.

    America is still the greatest country. Regardless of how many times we’re told we are not an exceptional country.

    The question is does the country have 5 more years, 10 more years, a generation before Americas potential is unleashed once again? It is clearly not being unleashed presently!

  10. louis says:

    “The importance of improving the data available on nonbank financial institutions was recognized to better understand their role in the financial system. In a number of countries, these institutions are growing in importance, and the balance of systemic relevance between bank and nonbank financial institutions can shift over time. For instance, new or strengthened regulations on the formal banking system could push more financial intermediation activity into the shadow banking system, absent further policy action to offset this.
    Further, there is a need to gain a better understanding of tail risks, maturity mismatches and leverage, both in banking and shadow banking, to help identify the build up of risk in the financial system as a whole. These were recognized as complex but vital issues to address.”

    Financial Stability Board.

    Complex but vital-Everyone clear on this now?

  11. Tulips says:

    Where I think BR sees “doomers”, in reality those folks are worried — the majority of folks in America could care less what the markets do because they have no money to put in the market in the first place. Most folks are worried about their future and whether or not they will be able to feed/clothe/shelter their family. The price of a share of APPL or what not is irrelevant to them.

    One of the examples that BR mentioned in the video piece was Video-licious (sp?). Sounds like a great idea, but realistically, how many jobs do you think that will create in this country? Not many. This innovative person could do very well for himself and a few colleagues so that they can join the so called 1%. But this is just tech “eye-candy” and does very little to advance the prosperity of the American people as a whole. People see that. I don’t think they’re as stupid as you think they are.

  12. mathman says:

    Being one of the “over the hill” “little people” i’m in the uninformed camp.
    As far as i can tell we have a dismal future ahead environmentally. Now whether you money-types can get something out of that, good on ya! As for the rest of us, we’re on our way down and out.

    The standard of living has fallen precipitously over the past 10 years with food prices way up; gas at near $4 a gallon (it caught up to the price of beer!); my house isn’t worth what i bought it for (but i don’t have a mortgage) so i’ll lose money when i sell for “retirement” (pure fiction at this point – i’ll retire when i can’t remember who i am or what i’m supposed to do or can’t get out of bed); lawlessness rules our financial institutions and the very places you guys work – corporations and Wall Street, the federal government and homeland security (not to mention the military, state and local police and of course TSA); medical care is still way too high – but now we’re being forced to buy this crap; education is a joke;
    jobs are still being cut (i just saw that IBM is going to lay off 10,000 workers) and being replaced with ones of lesser pay; there’s no leadership in Washington D.C. and the Fed has or is still ruining the dollar;
    the mortgage mess is still and on-going (despite the “deal” the fraudulent bankers cut with the government), housing prices and sales are still down in most places.

    Oh there’s lots more anecdotes i could provide but the gist of it is that i guess it depends on where you’re standing. For the banking and Wall Street gangs life is still a carnival (and the citizenry are the “marks”).
    So, yeah – i’m uninformed, but i get it. Things suck out here.

    i’m happy for those of you who are doing well, but please don’t try to tell the rest of us that life is sweet and the best is yet to come.

  13. emaij says:

    There is a real yin yang at work in the USA and, as BR astutely indicates, it’s easy to get caught up in one or the other. I can completely relate to walking out of tech conferences thinking that the future is invincible. I can also relate to people who are nervous about Fed policy that seems to rely completely on loose monetary policy while abdicating its supervisory role.

    From my perspective, and I have written about this, there really is a Goliath to the entrepreneurial David that BR is talking about. The big picture (small b, small p) Goliath is composed of crony capitalism, a financial sector that has been rife with fraud and Gresham’s Dynamics, regulators that are captured, and a lobby system that continues to build a universe of needlessly opaque, complex, and counter-productive laws that benefit powerful entities at the expense of everyone else.

    The question I ask is whether awe-inspiring entrepreneurship and incredible technology can overwhelm the negative forces that were exposed and not dealt with following our recent crisis.

    I would feel better about David’s prospects long-term had there been a lot more of a shake-out – ie if an army of regulators had been sent in following the crash, S&L crisis-style. A least some of the really dishonest people would have been removed and real sunlight would have been shined on some of the most egregious practices. As it stands now, we certainly have some idea of just how compromised the industry was, but we are relying on the people who brought us to the brink of disaster, to “mend their ways” at this point. We had an opportunity to reform a corrupt system and “we” blew it. At this point, one must have a degree of faith that the shadow banking system, the off-balance sheet items, the derivative overhang, the rent-seeking lobbying, and the Fed’s ultra-loose money printing will be overwhelmed by the entrepreneurial vigor that is so inspiring BR.

    There is no reconciling our David and our Goliath. BR does a great job addressing both; mainstream media, and most “comment sections”, do not.

  14. InterestedObserver says:

    Interesting comments above. I guess they’re from folks too young or have forgotten the multiple periods over the past 50 years when we’ve been absolutely going over the cliff into oblivion. Wait…., that never came to pass.

    @Tulips – sure Videolicious (or however it’s spelled) looks like a small entertainment toy now. So did personal computers when they were archaic things you assembled by hand from a kit. The point is, these technologies go places that simply aren’t on anyone’s radar screen when they’re conceived although I thought Barry gave an apt example in this case – a tool for real estate agents (or anyone else in certain types of sales/marketing). It’s unclear where this tech leads, but it places a specific capability into a wide swath of hands to which is was previously inaccessible. Someone will see an opportunity to which the rest of us are blind. In most cases the opportunity will fade away, but some may thrive and define a new industry/segment.

    The more general issue is that this world in one in which the highly trained and tech aware will thrive and everyone else gets pulled along. With an increasingly undereducated populace, more an more folks will get left behind. The structural issue is that previously we had a robust agrarian and then industrial bases to productively engage these folks. That’s changing now (through automation – a secondary impact of those toy home PC’s of long ago), although to what final state is unclear. It’s also changing in the emerging countries, so they’ll face the same issues eventually.

  15. jnkowens says:

    Went to link (to yahoo) and read the comments. LMFAO!!! Best comment was from Jason, re: US – “even the Mexicans are leaving”. You cannot pack more ignorance, cluelessness, and irrelevance into 5 words than that. Go on, I dare you to try.

  16. [...] Ritholtz comments on the comments left on some of his recent pieces on Yahoo finance, here. [...]

  17. dead hobo says:

    BR complained:

    I tried pushing back on a few of them, but its a tide of ignorance, and I only have 2 thumbs to stick in the dike. Read ‘em and understand why most investors under-perform . . .

    reply:
    ———
    With all due respect, STFU.

    While I try to be honest, forthright, capable, trustworthy and diligent in the best boy scout traditions here (except for the frequent swearing, blasphemy, total lack of respect for some people in some cases, and looking like a total bastard occasionally), and only talk my book when I think others will also benefit from my plans, we need those yahoo folks.

    At some point, trading is a zero sum game. You can’t win unless someone else loses. The timing is not as tight as it is with commodities. But when I win, I took someone else’s money.

    If someone refuses to be educated, then my only comment to them is ‘thank you for your support.’ Yahoo comments and apparently some hedge funds and professional traders go the extra mile and provide this support. Don’t screw it up by shoving a few unwanted smarts down their throat. Or aggravate yourself unnecessarily.

  18. dead hobo says:

    Britonomist Says:
    April 27th, 2012 at 9:04 pm

    There’s bad commenters everywhere, zero hedge is notably full of insane doomsayers.

    reply:
    ———
    As I have stated before, ZH is a national treasure. Besides printing stories that you will never see anywhere else and motivating others to report what would otherwise be hidden forever, they are also a investment barometer.

    When they read like a newspaper: hide under the table, roll into a ball, and talk to Jesus.

    When it’s part news and part crazy: All is well. Nothing to see here. The world is safe at this moment.

    When they shrill up the crazy: Go long in equities and prepare to make a lot of money.

  19. louis says:

    “multiple periods over the past 50 years when we’ve been absolutely going over the cliff into oblivion. ”

    Tell the guy who lost his job or his house that he’s still standing on the cliff. He might have a different take.

    If you consider continued FED bailouts of every failed product from the street a functioning capitalist system, well you have no cliffs to worry about.

  20. PDS says:

    the reason for your optimism BR? …..It’s Bush’s fault

    BTW BR…in this world of so called increased RIA transparency (leading the charge, your colleague Josh at Reformed Broker)…I would be more inclined to believe your past investment performance statements and assertions if you posted your GIPS and compliance approved LT and ST fund performance…as a professional money manager I’m sure you do that and your readers would appreciate it…

    ~~~

    BR: The firm is presently NOT GIPS compliant — I don’t run that division (yet).
    However, I expect to be fully GIPS compliant by year’s end.

  21. StatArb says:

    You know when the conversation turns into a train wreck , when commentary starts getting the

    Tea Party vs OWS tin foil hat knuckleheads involved

    .

  22. InterestedObserver says:

    @ louis: Been there, done that with the guy who lost his job. Helped plenty get rolling again via the network, and I agree, he has a different take and every justification to have that view, right now that is. That doesn’t mean society as a whole is inexorably heading southward and I do understand that there will be lots of folks who can’t be made whole after the disruption.

    As for the FED bailouts, I think you can make a decent case that the unanticipated secondary consequences could have been sufficiently bad that you may have not wanted to chance the situation. We’re not the same scale as Sweden or Iceland. I think both sides of this topic can make decent arguments. That doesn’t mean I’m pleased with all the results, the lack of regulatory action since, the lack of jail time, or the fact that many bad actors have seemingly made out like bandits at the end of the day.

  23. johnnywalker says:

    bubbles,

    Thanks for the link to the Laurence Britt article. Truly frightening, and a must read for anyone who believes in liberal democracy, the rule of law, and science.

  24. willid3 says:

    thinking that there are 2 things at work. one is that while the market is doing much better than it was 4 years ago (not there wasn’t much of a way to much worse. but given the fixation on wall street to judge how well the economy is doing. it lost the relationship to main street at least a decade ago). then there is the way things that impact main street. while government stats doesn’t show much inflation, but that was engineered for a reason. to keep SS and wages down. and that has worked out pretty well. for wall street. and we can see that wages (individual incomes) are not growing much at all. and then we have one party who seems to propose (and has passed) jobs bills. that aren’t. and never have worked. nor will they. since they wont require any action to get a tax benefit. but they cut taxes! its not much more than slogan about creating jobs, cause it doesn’t happen. is main street doing better than it was in 2008? definitely. for those who don’t recall, up to Jan 2009 we lost lost of jobs, and replacing that many jobs will take while. but to many say blame the president (for political reasons only) because that was when he took office (but oddly enough they wont blame their own president who 9 months after taking office had the biggest terrorist attack in the US in a long time, and had the biggest economic bust to go with it. and we still haven’t recovered from it. yet)
    so a lot of the doom is based on politics trying to advantage of a real issue, but those who are doing that, have nothing to propose that will fix it. after all they have engineered the situation.

  25. La Marque says:

    I’m with you, Barry! I stopped reading Yahoo Finance comments years ago because of the incivility and ignorance of most of them. MarketWatch commenters fall into the same category.

    I expect commenters to stay on subject and be succinct. The Big Picture, Seeking Alpha, ViaMeadia and First Things are the usual sites that I can actually read comments that I can learn from. I do watch a lot of Yahoo Finance interviews because of what the guests bring to the public discussion. I do not have pay TV.

  26. JohnathanStein says:

    After a look-see through pages of comments, I’d say Barry should put his ear to the ground, rather than a finger in the dike.

    Complaints of Camp Run-A-Muck in banking & finance and perennial unemployment were common themes — subjects seen on this blog.

    En masse, those folks aren’t stupid — they know small-time innovation will benefit only a few, anything big-time will be off-shored, that Barry is a 1%-wannabe. Some even know Blodget’s backstory.

  27. JohnathanStein:

    4 things in response:

    1. Blodgett’s story is pretty well known; people don’t get credit for knowing decade old front page news. And if that is their knee jerk response, well, that makes them useless in my book.

    2. Ear to the ground tells you what happened already, not what might happen in the future.

    3. As to the dividing line, 1% = $380,354 (source: 2010 tax data). Base don the survey’s we’ve done, many TBP readers are 1%ers; and a majority are 10%ers. Via Tax data, here is the breakdown

    Top 1%: $380,354
    Top 5%: $159,619
    Top 10%: $113,799
    Top 25%: $67,280
    Top 50%: >$33,048

    4. Lastly, I have more than enough money to meet my basic needs; what I am much more interested in top 1% of my industry in terms of professional achievement.

    I don’t expect the cynical trolls and other jackasses to get that, but there it is.

  28. Sunny129 says:

    ‘America is still the greatest country. Regardless of how many times we’re told we are not an exceptional country’.

    Why not?

    Especially to those belonging to 1%. Yep definitely, heavenly paradise on earth!

  29. Sunny129 says:

    EMAIJ:

    ‘The question I ask is whether awe-inspiring entrepreneurship and incredible technology can overwhelm the negative forces that were exposed and not dealt with following our recent crisis.’

    This is the ‘core of all sentiments’ expressed against the optimism generated out of Silicon valley and also to which I agree 100%!

  30. Bob A says:

    I’m sure Henry is in reality a pretty smart guy, but sometimes the stuff he writes on BI makes me think “Henry Blodgett” is just a pen name for some teenage girl. And that goes for most of the rest of the writes over there as well.

  31. Hanna says:

    Internet really gives us a possibility to be the one who we want to, signing our posts by fictional names… And there are different adventures and disadventures of that:)