1. Michael Santoli, who I think is a very good writer at Barron's, defined (mass) media as "Delivering eyeballs to advertisers". Funny, but I thought it was content first, and advertising second.

I thought we tuned in to a broadcast in order to receive content, and that if it is presented the way we like it, we continue to watch. But Santoli, a regular on CNBC, now says I've got it backwards; that the job of media is not to inform, educate and facilitate the subscriber, but to put advertising in front of us.

The subject came up when he was taking an opposite position to CNBC's Cramer on Google (NDQ: GOOG). Santoli is questioning why traders would go long GOOG -- a media company -- when today it is trading at three times the industry 2010 projections of total online advertising revenue.

I think he has a point; but I thought that months ago when GOOG was trading at less than half its current price.

Interestingly, Santoli asked the question if (a stock he mentioned) was overpriced at $300? As he said, that stock went to $400, but then fell back to $35.

The point he made was very relevant even if the figures he gave were quite inaccurate, so I removed the name of the stock.

2. As you know, Greenspan says that a "conundrum" exists today because the usual indicators that track the economy are no longer useful. If he can't figure it out, who can?

Then a Lehman Bros economist reports that the Leading Economic Indicator (LEI) is no longer useful as an indicator.

Now, Tim O'Neill, the former BMO (Bank of Montreal) chief economist, working under his own banner (O'Neill Strategic Economics -- which itself is a conundrum sounding name) has published an accusation that the Govt of Canada Finance Dept bureaucrats are misleading people. In a 165-page report, O'Neill, who is a respected analyst in Canada, says the Finance Dept operates under a Govt-directed "no-deficit rule".

O'Neill says that Ottawa has deliberately underestimated its budget balance by an average of C$10 billion (~US$8 billion) in each of the past ten years. Because of Govt policy, he says Ottawa underestimates (i.e., reports) annual revenue from taxes, and underestimates (i.e., reports) yearly spending on programs and debt service, in order to guarantee a surplus at the end of each fiscal year.

Maybe we need an Eliot Spitzer in Ottawa? Why are these bureaucrats and elected representatives beyond the law?

Interestingly, it was the current Minister of Finance who commissioned O'Neill's study. So I don't have to tell you what his response was, but for what it's worth he did make some inane comment about: "Frankly it's not an approach that commends itself to me from a public-policy point of view because once you deviate from the strict principle (which I take he means "overcautious"), then I believe you are very rapidly on a slippery slope.".

What ever happened to the truth, the facts?

I really question the Rule of Law today. It seems to me that the absolute power of judges, politicians, bureaucrats, and corporate boards and CEO's, has corrupted absolutely.

The public is merely being told what these people believe we ought to be told, and, according to Michael Santoli, what advertisers want us to be told.

3. I find, in corresponding to my readers, that the level of financial education is lower than most people are prepared to admit. Many of you recognize that problem, and are striving to correct it.

But that becomes a problem because advertisers and govt are driving (i.e., manipulating) the media today. It seems to me that those parties want the financial services industry to control the capital markets, which they see as a dummying down of the average person.

A lot of people are thanking me for speaking out, and saying that people generally need to smarten up, not dummy down.

4. In reading a lot of analyst reports lately, I am asking myself whether I am reading the analyst, or about the methodology used by that person. I'd rather see the former, but I find that too many analysts hide behind their approach to analysis.

In other words, the report is synthesis (i.e., story-telling), and since the analyst doesn't want to be called a story teller, he or she points out to the methodology used.

But, like tea leaf reading, any advocate will use the same evidence to come to the conclusion they need or want.

Even for mathematical calculations like any of the simple technical indicators or the Elliot Wave Theory, for example, the proponents will look at the same numbers and conclude whatever they need or want.

As for this point, I don't even want to get into the subject of economic data.

At the end of the day, doesn't the most important media come from a person you respect (as having more knowledge, experience, time, etc,), telling you their analysis, and then teaching you to be able to do the same on your own?

5. Too many financial services firms, being on the sell-side, like to make entertainment stars out of their spokespersons. They parade these people as TH's on all the media outlets in order to get the company name and logo in front of eyeballs.

The problem with that approach is that there is an authority-responsibility problem. When does the company take responsibility for these people?

I'd rather see every sell-side research report be issued like an auditors report, which is strictly by name of the auditing firm.

The public is often misled when they read or hear of "opinions" from people who work for the sell-side. For example, in the case of a junior retail broker in Sioux City Iowa talking to clients, is it really Merrill Lynch talking, or the registered representative?

6. Moral suasion is a feature of any govt in terms of the promotion of public policy. That's fine. But it seems to me that there is far too much blanket marketing of what's in the best interest of the marketer (i.e., govt and advertisers) and not for the owner of capital.

I have noted in the past couple years that traditional forms of fundamental, quantitative and technical analysis is being discarded in the financial media (probably because of the sell-side need to have people dummy down) in favor of discussion of matters like attitudes/sentiment/confidence.

It seems to me that media has adopted the Larry Kudlow approach to media: invite your friends who you know will support your position; give them leading questions; and end up talking over them anyway -- all for the purpose of willing the market to move up.

The problem with that is that capital markets mimic all aspects of life, which is based on cycles of nature. Prices rise and fall. They fall at times in spite of all the "moral" suasion to the contrary, which makes certain "personalities" in the media so potentially harmful to your financial well-being.

7. The equity market today is in short-term rally mode. In their campaign, the mass media has convinced enough owners and managers of capital to adopt a net buying stance, similar to what has gone on in the real estate market.

The problem today, as I see it, is that the market is rallying in the absence of legitimate reasons. When rising real estate prices eventually hit a glass ceiling, as they will, there may be a long and soft landing, as usual. But when securities prices, being much more liquid, hit a cycle peak, they tend to lose a relatively much higher pct in a relatively much shorter period of time.

It could be that the 1999-2000 blow off in stocks could be exceeded this cycle. I don't have an answer, but I am concerned.

What I do see possibly happening today is that govts around the world are becoming worried about the state of govt and personal debt, and are thinking (some of them doing) cutting central bank rates. Such accommodation is a clear inflation generator.

So while stock prices go up, legitimate analysis would dictate that price-to-earnings multiples would go down. But if enough media people keep their foot to the "attitudes/sentiment/confidence" pedal, then for a time, at least, share prices can rise.

Market risk also rises, which is something all owners and managers of capital must be particularly focused on at this point.

8. If you are interested in (i) small cap stocks and (ii) gaming companies, there is one legitimate analyst you ought to follow. His name is Bob McWhirter (Selective Asset Management), and right at this minute he is on ROBTV. You can catch the video replay later in the day if you didn't subscribe to the live TV broadcast.

I once worked closely with Bob McWhirter at RBC Dominion Securities Investment Management. Bob does his homework, and works strictly by the revenue, cash flow and earnings growth numbers. He is a true quant analyst, and a good guy in my books.