Indeed, News Corp revenue from affiliate fees for U.S. pay-TV carriers increased 13% in the quarter ended Dec. 31 whereas U.S. advertising rose 8%. Haverty's Gabelli Global Multimedia Trust, a closed-end fund that holds News Corp shares, is up 23% over the past 12 months. Not everyone, though, is seeing roses. All the market cheer is making Hal Vogel, an investor and longtime media industry observer, uneasy and a bit frightened. Vogel likes News Corp and has nothing but good things to say about Murdoch and COO Chase Carey. His concern is with a bull market that's been "artificially fueled" by a Federal Reserve buying $85 billion in bonds each month while keeping interest rates "ridiculously low." The U.S. grew a mere 1.5% last year after expanding 2.4% in 2010 and 1.8% in 2011 as unemployment has stood stubbornly at around 8% or higher, Vogel said. The payroll tax is up and gasoline prices have been rising. Inflation holds at 1.9%, though Vogel is among the crowd who claims that figure is being low-balled.
"The Fed, the European Central Bank and now the Japanese are trying to pump up their economies giving the illusion that things are really improving," Vogel said in a March 25 interview. "The Fed's policies are creating tremendous inflation. At best this points to sluggish growth, and at worst, we're headed for a sharp change of direction in the stock market." If the market does turn downward, Vogel forecasts advertising will fall sharply, and even higher affiliate fees won't be enough to compensate for the decline. "When it turns, it will be violent and it will be quick," Vogel warns, "because a lot of this market has been supported by central bank actions that are becoming less and less effective." Any market that has gained 131% from its low in March 2009 will have its collection of naysayers. But while Haverty acknowledges that News Corp and media stocks generally have benefitted from investors borrowing at low interest rates and investing in the market, he doesn't see doomsday.