Streetwise Professor

May 2, 2016

Zero Hedge: Zero Class

Filed under: Economics,Politics — The Professor @ 8:13 pm

Bloomberg’s Tracy Alloway and Jake Kawa wrote an expose on Zero Hedge last week. There was not a tremendous amount of new material here. I was disappointed that they didn’t have anything about Daniel Ivandjiiski’s father: I am convinced there is a Warsaw Pact intelligence connection there. The story focused on the revelations of an ex-Tyler Durden, Colin Lokey. Looked provided information that supports what I’d written almost five years ago, namely, that ZH is a Russian information operation:

Lokey, who said he wrote much of the site’s political content, claimed there was pressure to frame issues in a way he felt was disingenuous. “I tried to inject as much truth as I could into my posts, but there’s no room for it. “Russia=good. Obama=idiot. Bashar al-Assad=benevolent leader. John Kerry= dunce. Vladimir Putin=greatest leader in the history of statecraft,” Lokey wrote, describing his take on the website’s politics. Ivandjiiski countered that Lokey could write “anything and everything he wanted directly without anyone writing over it.”

The remaining Tyler Turkeys responded in their typically classy way. I am very proud to be featured in their lead:

Others, such as “academics who defend Wall Street to reap rewards” had taken on a different approach, accusing the website of being a “Russian information operation”, supporting pro-Russian interests, which allegedly involved KGB and even Putin ties, simply because we refused to follow the pro-US script. We are certainly ok with being the object of other’s conspiracy theories, in this case completely false ones since we have never been in contact with anyone in Russia, or the US, or any government for that matter. We have also never accepted a dollar of outside funding from either public or private organization – we have prided ourselves in our financial independence because we have been profitable since inception.

Hilarious. Hey guys: next time use my name!

And seriously. There’s a lot more behind what I wrote than “simply because we refused to follow the pro-US script.” Such a disingenuous non-responsive response is as much as a confirmation as I could imagine.

The Tylers continue to strike their pose as courageous battlers against the corrupt capitalism. Ironically, given that they recycle the laughable NYT bullshit story labeling me a tool of Wall Street, I have inflicted far more real pain on those that ZH claims to fight than they have. Whereas they are all talk, by my rough estimate I have contributed materially to cases in which banks, traders and others have paid in the mid-to-high nine figures to settle. The figure could realistically exceed ten figures in the near future.

After taking a swipe at me, the remaining Tylers turn their attention to Lokey. They quote extensively from his text messages (more class!) and label him as a drug addict and drug dealer, and claim that this discredits him as a source.

Um, he wrote for them for a year while he knowing about his past and his alleged instabilities. Doesn’t that kind of discredit what they published for a year?

Based on Lokey’s account, the Bloomberg piece describes ZH as the web equivalent of a sweat shop. This makes it highly unlikely that the remaining two named Durdens, Ivaandjiiski and Tim Backshall, carried the load prior to Lokey’s arrival. Thus, there are probably other ex-Durdens out there with tales to tell.

ZH is a dodgy operation. Bloomberg has turned over the rock a little. But there is much more to learn. Let’s hope Bloomberg, or someone else, turn over a few more.

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  1. SWP,
    Now be nice to ZH–it’s my only source of laughs each day!
    It’s the only “entity” that’s been wrong more than Obama–
    a race to the bottom between Bozo and Putrid?

    Comment by eric — May 3, 2016 @ 10:39 am

  2. Hey, you’re forgetting that ZH has predicted 9 out of the last 5 recessions. Seriously, they’re a wacky bunch but I’ll admit they point out some stories that I’d otherwise miss especially with respect to charts/graphs for industries I don’t follow.

    Does anyone (on the Street or otherwise) think these guys are to be taken seriously? Every headline is THE US ECONOMY IS FOREVER DOOMED. BUY GOLD AND SHOTGUNS NOW!

    I will say that I thought it was certainly more than 3 guys considering the volume of articles published.

    Comment by Duffy — May 4, 2016 @ 1:14 pm

  3. @Duffy-If you read my original post in November 2011, you’ll see that I pointed out that what you mention–“they point out some stories I’d otherwise miss especially with respect to charts/graphs”–is part of the MO. I noted this is the way information operations work. They offer legitimate content, sometimes quite useful to attract eyeballs. They do so in the knowledge that the eyeballs attracted by the legit material may gaze at the propaganda.

    The gold ‘n guns angle is part of the anti-US propaganda too. It’s a way of sowing FUD that creates division and saps morale.

    The ProfessorComment by The Professor — May 4, 2016 @ 8:12 pm

  4. If a foreign intel organisation were to mount an intel operation, why would they target the financial sector, via a website which appealed only to what we might generously term the ‘fringes’ of the financial and economic worlds?

    The cost-benefit analysis wouldn’t cut it, I think, especially when you can pay a teenager $200 for five minutes’ work to hack into Hillary’s email account.

    Comment by Ex-Regulator on Lunch Break — May 5, 2016 @ 3:46 am

  5. Respectfully Professor, I’m with Ex-Regulator on this one. This is either a poor intel operation or some sort of 9th dimensional kung fu that is lost on me. The Street is many things but naive isn’t really one of them. At best ZH can hope to peel a few people away from this or that but your average fund manager won’t freakout and the FUD impact I think would be low. Quants won’t even read this stuff so there’s even less traction in the alternate investment space. Just my $.02.

    Comment by Duffy — May 5, 2016 @ 8:38 am

  6. @ex-reg & Duffy. Not an intelligence operation. An information operation. They are different. The Russians, like the Soviets before them, go for a full spectrum approach.

    During the Cold War, the Soviets devoted considerable effort to disseminating information through outlets that you would consider very obscure. Insofar as cost is concerned, FFS, ZH is a money making operation.

    What me started thinking along these lines wrt ZH was the similarity in editorial line and style to RT, which is obviously a Russian government information operation.

    The ProfessorComment by The Professor — May 5, 2016 @ 10:42 am

  7. OK, I’m not familiar with the history of such operations.

    Amazing to think that Zerohedge makes money! LOL

    Comment by Ex-Regulator on Lunch Break — May 5, 2016 @ 4:44 pm

  8. @Ex-reg. It makes huge money, apparently.

    There’s a sucker born every minute.

    I’m old so I remember the way this worked in the Cold War 😛

    The ProfessorComment by The Professor — May 5, 2016 @ 5:45 pm

  9. too bad Bloomberg didn’t mention KGB\FSB connection. the essential fact, that would tell everything they need to know to anyone, who ever lived in proximity to russia\or ever dealt with KGB.
    they curate every single thing, and have all the resources of society at their expense, those informational operations are the daily routine here in RF, their tactic is nothing new, it’s the same people after all. and consider that approximately 5 million people in RF works for their system of agencies. we don’t know the actual numbers of FSB, FSO, SVR, as every possible thing is top secret once again, but these are indirect numbers judging from how they reform their agencies all the time.

    Comment by vrj — May 7, 2016 @ 8:42 pm

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