NEW YORK (TheStreet) -- Two "news" stories passing like ships in the night...
The speed and intensity of the 24-hour news cycle renders it difficult for most of us to make connections between seemingly unrelated articles. Over the weekend, however, I stopped and stared at two spectacles -- one that went viral, the other that went way under the radar -- long enough to make an association.
Led by Business Insider, the standard media hacks and even some otherwise credible outlets such as The Atlantic came together to skewer CNBC and TheStreet's Jim Cramer for predicting President Obama will win Tuesday's election in a landslide with 440 electoral votes.
This is what 98.5% of the media do. A handful instantly produce the easy answer; the rest follow like the uncritical cut-and-paste, let's link to somebody else's work for page views hounds that they are.Few take the time to look for meaning, deeper messages or connections between seemingly unrelated events or concepts. Almost everybody, in unison, branded Cramer a fool for being so far outside the lines of consensus. It's unfortunate that Cramer had to take to Twitter to explain himself, but such is life in a world that prefers dichotomy in lieu of nuance and black-and-white over 50 shades of gray (that last one might not be true, but you get the point). In Barron's over the weekend, Jack Hough wrote a solid piece titled "When Bold Analysts Say Buy" that sheds unintentional light on the Cramer blowup. Riffing on Wall Street analyst earnings estimates, Hough writes, "Bold forecasts have [become] scarce ... Estimates are more closely huddled together than at any time since 1986." At the same time, research from the University of Texas shows that when revised estimates "move away from the consensus" they "are more likely to prove accurate than those that move toward it." Hough pulls a few examples. An analyst at Bernstein Research upped her 2013 EPS estimate on Humana (HUM), which reports Monday, to $9.20 a share, way above the consensus of $7.14. That's about as "extreme" as Cramer's call on the election.
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