The Zero Hedgies

By Felix Salmon
September 30, 2009
story on Zero hedge. The vitriol aimed at him from the Zero Hedgies is something to behold, both in the comments on and on ZH itself. For instance, these three consecutive comments:

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I met up with Joe Hagan this morning, in the wake of the appearance of his big New York story on Zero hedge. The vitriol aimed at him from the Zero Hedgies is something to behold, both in the comments on and on ZH itself. For instance, these three consecutive comments:

Let’s get some of his work particulars, as well as information about his father. And does he have kids?
Hagan: you’re just another meal in the food chain, and you might find ZH readers are a hungry lot.

welcome to fight club joe.

Joe forgot we are the ones that educate his kids, care for his parents, fix his car and deliever his pizza. hehe

There’s genuinely nothing in the article which could remotely justify that level of hatred, except maybe for the fact that Hagan outed ZH as Dan Ivandjiiski. (Something the NY Post had done back on September 2.)

That said, however, it’s undeniable that ZH has a huge following: Quantcast puts pageviews at over 5 million a month, and uniques at over 330,000. (The ratio between the two is very high indeed by website standards, showing how sticky and addictive the site is for its loyal readers.)

Who are these people who flock to and lap up everything they’re served? They clearly love the chart-filled posts about intraday movements in the stock market, which is one clue. I think what we’re dealing with here is, essentially, retail day-traders, as profiled by Hagan back in February. (Hagan told me that even back then, before ZH really took off, the day-traders he was writing about were constantly reading the site.)

You need to be a little bit delusional to be an individual day-trader, paying substantial sums for information, technology, and trading spreads every day and yet somehow reckoning that by zooming in and out of highly-levered ETFs you can not so much beat as utterly obliterate broader market returns. All day-traders think they’re above-average; they have to, otherwise they wouldn’t have the hubris necessary to do it in the first place.

The idea really took hold in the popular imagination sometime during the first dot-com boom: stay at home, hook in to the markets, and make more by trading your own account than you ever would working for the Man. Call it the ultimate triumph of Capital over Labor.

It’s not hard to guess why these people might be angry: they’re losing substantial amounts of their own money in the market, and they’re casting about for someone to blame. The insanely profitable Goldman Sachs, for one, is always a good target. And indeed it might well be the case that Goldman’s traders probably are picking off a lot of these individual day-traders, and making quite a lot of money off them in aggregate.

Remember too that day-traders tend to be quite rich (or they wouldn’t have money to play with) and convinced that they know something most people don’t (or they wouldn’t have their self-perceived edge in the market). At that point it becomes quite easy to see how they would be attracted to a conspiracy theorist like ZH, who writes dense and often hard-to-decipher posts about the arcana of how the market works. The masses read Dan Brown for fun; the day-traders read Zero Hedge for profit.

None of this really explains the unbridled anger aimed at Hagan, but for the fact that when you’re casting around for someone to blame, and a major media outlet paints your idol as some kind of sleazy kook, you’re liable to take extreme umbrage — especially when you can hide safely in complete anonymity. The Zero Hedgies, in other words, are the 4chan of the financial blogsphere, which is maybe one of the more depressing aspects of the degree to which the financial blogosphere has matured.


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If you read the comments at ZH, most are rants and rare are the informed ones. It has a cult feel to it: where’s my koolaid today? I sincerely doubt most of the folks can understand much of what ZH writes. Having said that, once you get past the conspiracy stuff, there is actually some very insightful information on that site. I suspect there a large portion of the readers are more than day traders.

Posted by Dean Jackson | Report as abusive

They are kooks. And he is not very sophisticated, judging by his Chicago PMI diatribe today.Banned from the Industry for $780?That is just embarrassing.

Posted by BlowmeSofia | Report as abusive

I read the article, and I am a regular reader of ZH, though not a day-trader. My views on ZH are mixed. There is a lot of stuff, some good, some indifferent, some very poor. NY Magazine though was writing a story on how mainstream media are so much better (because they do their factchecking) than the blogosphere. That is one of the points that infuriates the blog-public. They found out that contemporary journalists do little more than copy-paste news agency reports and when they do anything different it turns out to be a he said she said story. No attempt at understanding anything at all. Sensation sells. Tickling the public. Controversy. No substance.Admittedly many blogs use controversy too. But the econoblogs mentioned in the NY Magazine article (including yours) do make an effort to explain stuff to their readership. And yes, they are sloppy at factchecking. But they give us so much more facts and background that it’s well worth it.

Posted by Marc | Report as abusive

You’re finally catching on. The fact that he runs boiler room ads means he knows his audience includes lots of losers.

Posted by Dire Turdly | Report as abusive

Two of those comments are near-quotes from the movie Fight Club, where the name Tyler Durden originates.I doubt seriously they were meant literally. Without knowing the aesthetic of the movie, they are out of context.

Posted by Scott | Report as abusive

“Having said that, once you get past the conspiracy stuff, there is actually some very insightful information on that site.”But you shouldn’t have to *get past* conspiracy junk. Nobody who values their time is, ultimately, going to stick around.”I suspect there a large portion of the readers are more than day traders.”Then they need to get a serious grip of the comments otherwise the spotty teenagers and arrested-development conspiracy nuts in their mother’s basements are going to run rampant. I wish I hadn’t gone there to see what the fuss was about, it’s too much effort to screen out all the junk, there are plenty of other sites with better s/n ratios.

Posted by SP | Report as abusive

“Remember too that day-traders tend to be quite rich (or they wouldn’t have money to play with) and convinced that they know something most people don’t (or they wouldn’t have their self-perceived edge in the market)”I think most “day traders” reading Zero Hedge are trading cheap stocks.”The Zero Hedgies, in other words, are the 4chan of the financial blogsphere, which is maybe one of the more depressing aspects of the degree to which the financial blogosphere has matured.”Long before Zero Hedge, there was a lot of similar crap in forums such as at Yahoo Financial. ZH is just a new place for them to congregate.

Posted by Jon H | Report as abusive

Felix Salmon is becoming more like Ben Stein every day. He used to post interesting stuff and now he is obsessed with people he thinks are losers. What a joke. You were better as an unemployed independent blogger than as the corporate hack you are rapidly degenerating into.

Posted by Steinberg | Report as abusive

I suspect a fair number have moved to there since Daily Reckoning closed their forum down, especially as I’ve been noticing more goldbugs lately.Lately they’re getting too hit & miss and there’re better blogs out there. And while they have a ‘conspiratorial bent’ – well, sometimes there ARE conspiracies and corruption. Of course there would be – Madoff was proof enough of a lax culture when it comes to regulatory oversight and the potential payoff is too great for there not to be corruption in some form.I also agree with something I believe you’ve pointed out too- that there should be one pseudonym to writer.However, I don’t think the NY mag article was exactly a proud day in journalism either.

Posted by Jessica6 | Report as abusive

Try reading Once in Golconda, then maybe you’ll actually have some backing in US financial history. Most of the conspiracy theories about the market are true at some level, and many are completely. Just look at the spin you “journalists” regularly put on data that comes out – it’s a minor version of the grosser market manipulation that occurs every day.

Posted by Tharpedo | Report as abusive

Financial media in general failed. It completely missed the largest financial crisis of the century. Zero Hedge at least attempts to push the envelope As for Goldman being “insanely profitable”, they take huge risks and have the government as a backstop for their losses because of their massive size. People have woken up to the fact that this is unfair.

Posted by Mike | Report as abusive

If the readers of this comment section think that the market is truly free, or that Goldman doesn’t have a supreme advantage based on size and inside connections, I have a bridge to sell them.In another day and time, before the governement was effectively owned by Wall Street cronies, GS with its super-computers, algorthyms, and absence of viable competitors, would have been deemed a monopoly. Now it is a monopoly backed by taxpayer dollars and alumni that work hand-in-hand with the policy makers.Watch the markets any day before a major Fed/Treasury or WhiteHouse economic policy decision and you will see it move early. Watch.

Posted by Sully | Report as abusive

I am stunned at the level of intellectual superiority contained in your post.I am a regular reader of ZH, have 2 degrees (one is an LLB), and work on an institutional desk.The reason i frequent his site every day and not yours is because i learn something from him as opposed to things about him.As for Hagans piece, it was worthy of People magazine. Which isn’t exactly a strong journalistic endorsement.I suspect that most MSM organizations (and many blogs) wish they had the loyalty that Zero Hedge has from their readers.

Posted by lizzy | Report as abusive

Felix (and Joe),I am a Zero Hedge reader. I can’t speak for others but I can speak for myself.I am not a day trader. I don’t even work on wall street. I run a software company.When I see Goldman Sachs get paid 100 cents on the dollar as an AIG counter-party, and Merrill Lynch move up bonus payments, and wall street give out record bonuses 6 months after blowing a multi-trillion dollar hole in the world economy, I feel angry. And there is no one in the mainstream media who seems to realize that this is indeed scandalous. In fact, of the 65 Pulitzers given out in 2009, not 1 was awarded for coverage of the biggest financial crisis since the great depression.Zero Hedge gives a voice to people like me who feel that wall street is a rigged game where a chosen few make obscene amounts of money at the expense of people who work hard and pay taxes.

Posted by Mitch Rubin | Report as abusive

I would say that half the material on that site is useful. The other, not so much. It has deteriorated since they brought in a bunch of day traders as commenters. Anyone who watches the market tick by tick see stuff that “doesn’t make sense.” It happens. Some can’t seem to handle it and scream bloody murder anytime their formerly 1 correlated security deviates. Others adapt to changing market conditions.But I do find it rather peculiar that after witnessing what we have over the last year one could speak down to “conspiracy theorists.” To believe there hasn’t been conspiracies between the big banks, government and the Fed is crazy. Foolish and crazy.

The Hagan article had the touch and feel of a screed, and the present-day universe of discourse is rather rude. What did he expect the reaction would be. Read any of the blogs and the comments are pretty harsh. Hey, the comments about Hagan were nothing like the teabaggers against POTUS — and Hagan isn’t the president.

Posted by Tom Hickey | Report as abusive

Seems like Hagan is jealous.

The thing is, it’s been evident more or less since the very beginning that Zero Hedge’s outlook was fundamentally unreasonable. It just took nine months for that outlook to metastasize into the blog’s current incarnation.Matt Taibbi is guilty of exactly the same things as Zero Hedge, but I’m sure we’re going to have to wait for him to openly endorse something truly insane before Felix scuttles that particular ship. But you can already see it coming – Ron Paul is right about the Fed, Goldman Sachs is evil, and so on.This is what happens when you start letting your journalists play fast and loose with their facts and arguments: the crazies begin to leak through. Reasonable, honest people assume that everyone else shares their values and are often far too slow to realize that the Taibbis and Ivandjiiskis of the world simply have no interest in thinking critically about their own conclusions. It’s great when they agree with us, so we figure their minds are probably in the right place; their minds are probably in the right place, so we can overlook the warning signs in their argument.Compare Mike Konczal. I don’t always agree with him (although usually I do), but I’ve never doubted for an instant that he was glossing over any piece of information for the sake of punchier arguments. If something doesn’t fit, he takes it into account. He’s the kind of thinker we need to be elevating, not the hysterical polemicists who piece together dramatic conclusions with ill-fitting facts.

Posted by WHS | Report as abusive

I’m a very regular reader of ZH and find it far more informative and challenging than what is generally classed and served up in Australia’s MSM’s as “Financial News and Opinion”. Between such sites as Market Ticker, Naked Capitalism, Credit Writedowns and Jesse’s Cafe American you can start to build an informed picture of what’s NOT being told in the MSM’s. Sure, these sites link to many MSM articles but they are the types that challenge the orthodox opinions which is the difference between reporters and journalists. I do find it appalling the types of comments that threaten a writer and are extremely unhelpful when such sites strive for recognition.

Posted by Glen | Report as abusive

Felix, this post in itself is a viscious ad hominem attack, if I ever saw one. In fact, it is much worse than anything I’ve read on ZH. It is full of conjectures, broad generalisations and Fight Club jokes taken out of context. I find it surprising you would sink to that level.

Posted by Kamen | Report as abusive

I read Zero Hedge, Felix Salmon, and many other information sources. Don’t know this Joe fellow, but I am sure Zero Hedge makes for an interesting article. Sorry Felix I’m not a day trader, or a high frequency trader…

Posted by Steve | Report as abusive

it is like a junk yard: most of the articles on zerohedge are trash, the comments even more so, but from time to time, one can find a really good reading.

Posted by baychev | Report as abusive

When I read mainstream articles they usually refer to some source data and after trawling through the sources myself I usually find some different perspectives than the ones reported. Zero Hedge can be quite good at sniffing out those perspectives. Quite often they are slightly wide of the mark, but their persistence will quite often reveal other issues. For me the best articles there are those backed up by those with significant industry knowledge, like Rosenberg, matt rothman at Barclays, William black etc. Zero Hedge views need to balanced by reading FTAlphaville, Naked Capitalism, Calculated Risk and even this blog and here in lies a problem with some of the commenters on zero hedge. They don’t seek wider or differing views, instead resorting to cheerleading, rather than reasoned argument. At the same time their does appear to be a weakness in mainstream media, in that it tends to skim the surface and be reluctant to really delve into issues. For all its faults zero hedge, like this blog and others provides a starting point for all those things that get glossed over or obfuscated for convenience.

Posted by Brick | Report as abusive

The ZH community is much more that disappointed day traders. ZH offers a forum for exchange of observations on the systemic failures which have led to the looting of the US, UK and EU central bank reserves and treasuries – arguably the biggest crime in history if it was a coordinated effort by those on Wall Street who have gained the most.The anger over at ZH derives from many of us having vested careers and savings into a system that betrayed us. Regulators refused for 25 years to enforce regulations on consumer protection, margin, capital adequacy, insider trading, market fairness, etc. Legislators refused to provide effective oversight of an executive branch that refused to do its job. The media refused to expose the corruption of the system, transforming instead into cheerleaders for greater and greater excesses of debt, leverage and irresponsibility. Law enforcement refused to investigate or prosecute gross misconduct, leading to a generation of powerful people who see themselves as above the law.In the meanwhile any investments have suffered the serial effects of a housing collapse, market crash and zero intererst rate policy – leaving no where to go for asset protection (hence the gold bugs).The system has failed. Those who gather at ZH recognise the scope of that failure. That they are angry proves that they are enlightened.That said, criticism of Hagan was a bit OTT.

Posted by London Banker | Report as abusive

Yes Yes this new corp hack will be known as Felix Ben Stein from now on.

Posted by Jagnik | Report as abusive

Reading the Hagen article, i was thinking, “He’s out of his depth, here. He almost understands what’s going on, but doesn’t really grasp it.”Regarding your more general criticisms, Felix, I also have 2 degrees (one LLB), although I do not work on an institutional desk. I also read zerohedge everyday, although I read you only ocassionally.It seems that everyone wants a piece of zerohedge at the moment and I’m sure that an article dissing it, like this one (although your hit on the commenters first) will gain you traffic for this article.However, I wonder why you want to target zerohedge and its readers, when there are…oh, I don’t know, about a thousand more worthy targets around.I will think twice before returning here. [No, cancel that: I don't think that I will think about returning, although you might have something interesting to say at sometime...maybe I'll read about it on zerohedge?]

Posted by Ano | Report as abusive

Agree with “Mitch Rubin”I think a lot of support Zero Hedge gets is because he spends a lot of time wallping Goldman. There is irrational and rational walloping of Wall street, but in my view there hasn’t been nearly enough walloping from the MSM. CEO’s who blow up the world using as an excuse that this was just “too complex” don’t deserve too be paid anything for the past several years – their whole employment was a fraud – they advertized themselves as smart, sophisticated, etcetera, and they didn’t have the understanding of a 12 year old.

Posted by fresno dan | Report as abusive

Come now. There are many readers of ZH, but obviously the most vocal are the same type as you’ll find on Digg, Slashdot, etc. They don’t define ZH any more than the noisiest of internet commentators defines the internet.

Posted by Richard | Report as abusive

It was neither you or the other established media, which kept focus on flash trading until the SEC announced to ban this practice on 9/17. Your writings about ZH and conspiration theories are therefore ridiculous attempts to nebulize your own role in the New York financial cronyism.

Tyler is busting down doors and opening up areas of inquiry that others have ignored. Yes, he may make a mess of the crime scene, but other, more careful, bloggers follow his lead and make an accurate inventory of the evidence.I am not a daytrader. I have not lost money in the market and actually have done quite well over the last year, five years and ten years. And I thank blogs such as Calcualted RIsk, Naked Capitalism, and RGE Monitor for helping me navigate these past few years of market tumult. The mainstream media and economists (Shiller, Baker, Rosenberg and Roubini excepted) have been of little use to me (except as contrary indicators).

Posted by John | Report as abusive

If you looked inside those reads on a daily basis you would find a very good number of .GOV hits.You think the folks at Treasury, Fed,FHFA,FHA Fannie, Freddie Ginnie, FDIC and Social Security are day trading? You are wrong. They are looking at ZH because they want to know what is being said about them.I guest post for ZH. I know their reach and their audience because I get the responses from the D.C. crowd when I write about them.When the President talks of the decline of the straight press and voices his concern about the rise of the blogs he is referring to ZH.What troubles people about ZH is its success. A significant portion of the readers are mad. And they express themselves about their anger. There is a lot of that going around today.If D.C.and the Press want to marginalize ZH they need only to step up and start telling the truth. The mush that is served up on a daily basis just expands the audience and demand for ZH.Given that there is little hope for that, one can expect that ZH will continue to succeed. And that the straight press will continue to take cheap shots at them.

The author here makes a wrong assumption, that all readers of Zero Hedge are day traders, and then proceeds to discredit the readership of Zero Hedge upon that incorrect assumption as if the fact, were it to the true,were in itself of a derogatory basis. The article goes about to discredit day traders not the readership of Zero Hedge.I am a reader of Zero Hedge, not a day trader and thought that the earlier editions were of better quality than present. Are the main stream media bloggers showing concern because they are not getting the readership ratings of the new media, and at the same time are tied by their employers editorial limitations from writing what the public wishes to know about ?

Posted by Point of view | Report as abusive

sorry, felix, lots of mistakes in your article. i’m a daytrader.daytraders only need 25k to be “full” daytraders. i started with less money 10 years ago before the insane PDT rule was implemented (which helps people NOT to have stops – the quickest way to blow up an account).daytraders don’t need the market to go up, or need the market to go down. there’s needed some level of predictive volatility, and being on the same side as the (stock/commodity/ETF) they are in.most retail daytraders couldn’t give a whit about anything except the stock market, or a very active / popular commodity there’s a bunch on ZH which doesn’t concern equities at all. the debt market is foreign to most individual daytraders.for example, the RIGHT daytrader trade 2 days ago was long CIT, sell at the close. did you see how many people ranted on CIT at ZH?and many daytraders PIGGYBACK goldman sachs. if they know that goldman, or someone else is taking a position in a trade, they want to go in the same direction. it’s why many of them were upset that the NYSE went hybrid; following the specialist could be quite profitable at little risk.and zh does attract lots of conspiracy theorists. i agreed with your comments way back about “tyler durden 1″, “tyler durden 2″, etc. because there’s some posts in there which are just plain wrong, or looking for conspiracy when randomness will do.

Posted by noname | Report as abusive

In summary the blogosphere is free,the financial markets are not.The cumulative choices driven by the Stokolm syndrom,the traders Pavlovian education are driving them towards something else than prechewed customer s crownies journalism.

Posted by anonymous n+1 | Report as abusive

Agreed, this is a very ad hominiem article. To paraphrase: “Only money-losing day-traders read ZH”. Did I get the thrust of that argument correct?I find it rather ironic and completely amusing that a MSM finance writer is making ad hominiem attacts toward his would-be reading audience. FYI Felix: Your future articles will be viewed through this lens henceforth.I have been reading ZH since its inception, and find it refreshing, in a hand-grenade-thowing sort of way. Not everything written there is useful or correct, but the same can be also be said of Dan Rather and Tom Friedman.Sometimes the ZH allegations are off-base, and sometimes they strike close to home. The Perot Systems insider trading ZH pointed out one day ahead of the SEC action comes to mind. Of course none of us expects the SEC to go after major bank Ponzi activities, but it’s OK for me if ZH points it out and denounces the SEC (Treasury and Fed) for their failures.Apparently, pointing out massive and brazen corruption within US institutions is not a strong point of mainstream journalists.Oh – back to the ad hominiem: I am not a day trader or involved in finance. I work in heavy industry.

Posted by IdahoSpud | Report as abusive

C’mon Felix, is this the best you can do?Why the resentment?

Posted by sadsadfelix | Report as abusive

I read ZH daily altho I find the experience mixed at best. At times, it has provided some important insights into the machinations of Wall Street, such as HFT and frontrunning, while really being silly at others. Still, if one wants a FULL understanding of the marketplace and economy, one has to sort out the good from the bad at sites like this.Occasionally I read the reader comments, usually because I’ve clicked on a particular item to read the item in full or capture a document. And, yes, they are vulgar and extremely supportive of ZH. Indeed, in the rare cases when I’ve deigned to offer some comment and constructive criticism, it has been yanked from the ZH comments (if it’s even been accepted in the first place). ZH is not looking for discussion, it’s looking for adulation.That said, I also read Joe Hagan’s article and found it as abominable as some of ZH’s postings. It is so far over the top in unsupported accusations that ZH and its readers are conspiratorial and paranoid and all other sorts of psychotic characteristics that it’s not credible. Moreover, Mr. Hagan did not once in his article refute–or even attempt to refute–any of the charges or information that ZH has presented in its blog. In short, it provided no credible information. I don’t know who Mr. Hagan is, but his article surely did not show that he has any economic/market/finance or journalistic credentials. It was a rather pathetic paen to mainline Wall Street whiners.For the time being, I’ll continue to track ZH’s blogs, warts and all.

Posted by Lilguy | Report as abusive

The mainstream media quote individuals who talk their own book. So some skepticism is necessary when reading anything published anywhere. IMHO all news reporting is biased. Selective reporting of detail or choice of words any substantial article. ZH isn’t different, better or worse. A screenshot of a chart may be out of context. Comments aren’t all from lemmings. Many posts have comments with counterarguments. Reading blogs (including ZH) is part of staying informed about the markets.

Posted by John | Report as abusive

Felix, I am not sure what small percentage of the huge readership at ZH are regular commenters. I read them, but almost NEVER comment because I don’t see the point. I comment where the discussion is going to build, and I don’t see that generally in the ethos of the comments on ZH.With that said, I do read them. I’m not a trader. But I do believe wholeheartedly in regulatory capture and I have sat with enough of the “smartest guys in the world” to know that they generally are not: they are running some scam. I read ZH for entertainment mostly, but occasionally there is something really good there. I read a wide variety of blogs (with my mental filters firmly engaged, thank you) and I break them out by their bias. I read some primarily as aggregators, or because they are especially generous with proprietary information, or because I just enjoy the alternative screed here and there.On the one hand, I feel like I’m feeding the trolls responding to a post like yours calling someone else’s commenters and readers idiots. On the other, you seem to generally fail to grasp what is entertaining about the ZH take on the market and why someone would read an anonymous source with overzealous commenters. Well, it takes all types.Lastly, if you’d like to see some genuinely dangerous stupidity, read the “living” section of the huffpost.

Posted by Priscilla | Report as abusive

Hey, remember the time when Felix actually posted something interesting/insightful? I thought this blog generally focused on market observations, not excorciating other righfully-purposed blogs and their loyal readers. Felix, quit focusing on ZH and go back to what you do best…

Posted by Sean | Report as abusive

ZH readers are kind of the financial world’s equivalent of Apple fanboys. They react in an absolutely insane manner to any article that isn’t entirely glowing.The NY Mag piece was pretty neutral in tone – cracks me up to see all these people calling it a hatchet job.I still don’t get why ZH persists in calling all their writers Tyler – I get the fight club reference, but makes it harder to separate the excellent writers on the site from the craptastic. Palahniuk has lots of other characters in his books, you know.

Posted by rcyran | Report as abusive

Sigh. For gosh sakes, get your facts straight. Dan is NOT Tyler. At best, he is a contributor. Nice try, but a big strike out. There were a few clues way back as to who the original TD really was, but fortunately, those even those random clues have been removed.Lets face it Felix. You are just as passe’ and irrelevant as the rest of the bozos, wondering who TD is. GET A LIFE.

Posted by Lil | Report as abusive

Oh, and now YOU are riding Hagan\’s shirt tails to boost your readership? IE-This is a story about another story about how \”shocked\” I am about Hagan\’s craptastic factless article. How transparent.REALLY lame, dude.

Posted by Lil | Report as abusive

Felix, do you even read what is on ZH? There is a decent amount of useful stuff on the website. Lets see, today we have excerpts from a piece by Albert Edwards of Soc Gen.I read less and less of the mainstream press. Bloomberg/Reuters/FT all fall into a different category. Good thoughtful critical reporting is hard to come by. Where there is a vacuum (much reporting today is indeed ‘vacuous’) ….

Posted by Ben Chua | Report as abusive

They trashed Jesus too. Even a Buddhist like me can see a similar process ramping up against Zero Hedge.

Posted by Jim | Report as abusive

This is journalism?! Really? You can actually make a living writing such unsubstantiated tripe and get published by Reuters. Reminds me of my teen daughters avidly discussing the latest high school hall way drama. \”Oh, they are so delusional, those rich bitches, and they think they are so much better than everyone else.\” God, they must be day traders who actually think they can do better than the bankers. Look around, fool, you can\’t do much worse than the bankers. Might as well learn something and at least know that you made the decisions which led to the loss of your retirement rather than letting GS spread your cheeks. And this idea that suggesting conspiracy by Wall Street and the Fed makes you delusional – what is that? History, nay current events, are full of conspiracy. What do you think all the terrorist are doing if not conspiring to do dirty deeds? What am I missing? Oh yeah, I get it, GS and the Fed are the good guys, they would never stick it to the public while feathering their own nest.

Posted by Andrey | Report as abusive

Fish boy,Why don’t you report on something important?

Posted by William Thornton | Report as abusive

For anyone intereted in ZH’s retort to Felix’s verbal diarrhea above, please read closely. I, for one, fall into one of those categories listed in the link below, not one of the degenerate “day-trader” losers that are the unfortunate beneficiary of Felix’s vendetta. Felix, enjoy semi-insightful viewership from your CNBC viewers and wine afficionados while the real issues are discussed elsewhere… le/learning-love-carrot-and-stick-person ality-journalism

Posted by Sean | Report as abusive

Last fall and winter, when everyone was trying to figure out what to do in the aftermath of the crisis and how best to move forward, many were asking a fundamental question: “How the heck do we even get a handle on what’s really going on?” Paulson didn’t stay current by watching CNN because by definition all important financial information is insider information. We can easily dismiss the MSM as hopelessly biased, simple, and an essentially vapid mouthpiece. Much like the loudspeaker on the Titanic telling everyone to stay put, the experts are in control. The fact is that there is a revolution going on in the financial blogosphere, ZeroHedge being a prime example. The best way to characterize it is essentially “punk”.While the MSM presents genteel bankers and pinstripe-suited PhD’s, the “Fight Club” analogy has been proven to be much closer to the reality of Wall Street. That edge is what’s appealing to many readers and is what gives ZeroHedge credibility, (deserved or not), which is precisely what is sorely lacking in the MSM fluff pieces (they may be “reassuring” but are clearly not actionable). Sure there are errors in their analysis and rampant groupthink, as there have been from investment banks and Fed chairmen. But their errors pale in comparison to Cramer, CNBC, and essentially every other mainstream financial news source. How many times have they recommended a stock the day before bankruptcy? Heretofore, it was the bloggers who saw it coming.To offhandedly dismiss blog readership as “dead enders” is profoundly mistaken- even if many comments are easily stereotyped, many others show pedigree and serious credentials. When investing the proof is in the pudding and only what’s closest to the truth is profitable and one must stay ahead of the curve. So it’s logical that the blog revolution would be most profound in finance.It’s not so much that a blog like ZeroHedge came about as a result of recent events- this crisis was created because our wealth and power structure has become top-heavy, thus it collapsed. This has been brewing for years, decades even, because of moral bankruptcy, national bankruptcy, the hollowing out of our economy, and the fleecing of the middle class. But you don’t have to ask bloggers about it- ask anyone on any street anywhere in the world. Everyone knows it’s wrong. Even in the halls of power they’re saying so, but never in public. The bloggers (and commenters) are merely the ones who are writing about it and putting the pieces together, with varying levels of skill and success.As to being nailed for an insider trading wrap for less than lunch money, who was it that said “the law is like a spiderweb: it catches the flies and lets the boar run through.”? Have there been no shennagins during this, the biggest financial scandal and collapse in a generation? During the last S&L collapse there were thousands of arrests. Where are the perp walks now? They’re too big to fail! So blogs are serving an important function- that of examining the underbelly. The art of medicine was once superstition, until a few were willing to push the envelope, dig up corpses under the cover of darkness, and examine them anonymously to see things as they are. Many of these intrepid souls were orthodox by day, and pioneers by night.The impressionists were laughed at. Elvis was seen as vulgar. The hippies were a fringe element that captured something essential about American culture and had a meaningful effect on it’s evolution. Jazz was created by people who weren’t obsessed with orthodoxy because they had no stake in it. Hunter S. Thompson played fast and loose and gave us a new perspective. The punk attitude did also. The Mona Lisa has attracted more than its share of vitrol, and the fact that ZeroHedge is now a target only proves its profound impact. And, like it or not, they have generally been far ahead of the curve. Important news has hit the blogwires first, and then might get cursory mention in the MSM much later.There are some serious changes going on worldwide, and it’s happening first amongst those who are able to put the pieces together. The internet has revolutionized information accessibility, and thus is fulfilling its democratizing promise. The downside is that one must separate the wheat from the chaff, but such is life. There is more than a touch of irony when the MSM dismisses alternative news sources with platitudes and generalizations. The truth is that the bolgosphere is presenting previously overlooked facts and distilling/deconstructing it in a new way, albeit it’s own way, and reaching conclusions often more penetrating and thus more actionable than traditional news sources.And the only thing you can come up with is to insult the readership? Think again, friend.

Posted by Cornelius Blackshear | Report as abusive

@Cornelius Blackshear.That’s one of the best things I’ve read all day.Thank You.

Posted by Point of View | Report as abusive

Well said Cornelius and so much more polite than my own comment. The best take on why ZH and other blogs are taking off is presented by Samantha Bee on yesterday\’s Daily Show explanation of HFT. Check it out on another of these blogs:

Posted by Andrey | Report as abusive

Felix,Add me to the list of annoyed Zero Hedge fans who was an avid reader of your column. Until yesterday. I really, really don’t like being stereotyped – I read the Nation too. I suppose that makes me a communist? Or does that simply confirm my paranoia?And I have to say, other comments on this page made me happy. Bravo, Zero Heads.Finally, I noticed a guy on television last night bemoaning the state of the financial system – basically saying that it’s tilted in favor of a few. He was on Charlie Rose and his name was….what was it again? Oh yeah, Paul Volket, or Vulkan, or no, it was Volcker, Paul Volcker. But I’m sure he’s just some day trader who has it out for Goldman Sachs.Bye, Felix, and good lu- nah, just bye.

Posted by Jon | Report as abusive

Felix,I think you’re painting the readership of Zero Hedge with far too broad a brush. I’m an avid reader and occasional commenter on the site, and far from a day-trading loser shut-in or malcontent, I am: an MIT educated electrical engineer, a Harvard Business School educated MBA grad, a veteran of two successful technology startups from early stage through IPO, a former venture capitalist of 3+ years, …I say all this to say that maybe I’m an exception that proves the rule, there are more than “stick it to the man” day-traders in pajamas reading Zero Hedge. Alternative points of view are always good grist for the mill when formulating one’s investment strategies, and ZH’s views are nothing if not alternative.

Posted by just.a.guy | Report as abusive

You are a Zero Hedgie if you recoiled in horror at Hank Paulson’s first version of the TARP bill; if you were outraged at Paulson’s and Bernanke’s manhandling of the Bank of America-Merrill Lynch shotgun wedding and their obvious complicity in securities fraud; if you were dismayed at the outright theft of taxpayer dollars via payments of 100 cents on the dollar for worthless phony derivatives from AIG to Goldman Sachs and other politically powerful banks, who should have been left for dead; if you are alarmed at the lack of journalistic integrity in the main stream media evidenced on CNBC and blogs such as these, where facts and statistics are twisted and cynically spun on a daily basis to support the agenda of the wealthy and politically powerful; or if you are angered by clumsy ad hominem attacks designed to marginalize and silence those who dare speak the truth of what is going on in this country. You, Felix, are not a Zero Hedgie.

Posted by Ned Zeppelin | Report as abusive

Regardless of the actual veracity of the content on ZH, at least its not puffery. Does journalism school even teach how to write a story and actually, you know, explain whats going on to the reader? Apparently not. If I wanted a profile of the guy I could go to Facebook. Other than wasted time, what does the piece give me? Absolutely nothing. And before you dismiss all the items as being a conspiracy nutcase stuff, you might do yourself a favor by actually checking it out. Because the govt would never never never lie to the public, right? Check out GATA and the data they have on gold, which is extensive and comes from govt agencies own reports. Or is that too hard to actually do some investigative reporting?

Posted by jimh | Report as abusive

Put more simply – the people know something is rotten in Denmark. And they don’t trust the current power brokers to tell the truth. At all.

Posted by jimh | Report as abusive

And I am not a day trader. Not even in the equity markets. Neither are any of my friends who also read ZH. Nice job of smearing and labeling the entire readership so that its easily dismissable as just a bunch of day traders.

Posted by jimh | Report as abusive

i love it when a ‘journalist’ comments about any group of over a million viewers, chery-picks a few extremists, and then generalizes them ALL as ‘these people’ (multiple times) as if a million people could actually be that consistent and/or coherent.i don’t suppose he like those Glenn Beck viewers either.or the Ron Paul followers either.and probably thinks the “Sound of Music” is provincial and schmaltzy (sp?).but you’ll never see these guys commit to anything they like. they just throw stones. don’t distract them with facts.once you see their MO, they’re rather predictable and fun to read. show your kids how it works! more fun than scrabble.oh, and i forgot… buy gold.

Posted by i.knoknot | Report as abusive

you’ve dignified this piece of rubbish-writing enough folks… your time is precious.go read something real somewhere else. vote with your clicks.

Posted by i.knoknot | Report as abusive

ZeroHedge has some great posts and some crap posts.Felix Salmon has some great posts and some crap posts (like this one).Felix Salmon, why don’t you focus on something useful, like the corruption in our capital markets instead whining about Zerohedge’s readers? Why does it matter who Zerohedge’s readers are?

Posted by Fu | Report as abusive

The quality of writing on ZH is uneven compared to some financial blogs (Mish or Automatic Earth come to mind).However, criticism by an MSM flunkie is high praise. Salmon only forgot to claim that ZH is “racist” and he would have touched all the bases for the standard “kill the messenger because the message offends my masters” approach that passes for journalism from the old media.At least ZH tries to provided the truth, even if their articles are occasionally crude or poorly written. The MSM simply lies to protect their bosses and the corrupt system they run.If you want to compare the quality of readers. I bet the average ZH’er is a lot less likely to excuse Polanski for child rape than the average NYTimes reader. Oh but wait, saying rude things about Goldman Sachs is much worse than sodemizing children. Where are my morals?I approved this message and I am not a Day Trader

Posted by Gary Poteat | Report as abusive

Zero Hedge surely got some free publicity. Lot of comments here too. If the subject realy is sophisticated you don’t see as much but if folks can do some ranting they are their. It’s pathetic!Gore Vidal is right: “Does anyone care what Americans think? They’re the worst-educated people in the First World. They don’t have any thoughts, they have emotional responses, which good advertisers know how to provoke”From: Gore Vidal: ‘We’ll have a dictatorship soon in the US’

Posted by Youri Carma | Report as abusive

I came across ZH on the third day (it was still a blogspot). I’ve never owned (directly or indirectly) a share of stock in 62-years but things worked out quite well without them. Most people confuse Wall Street with investing but the reality is that it’s just speculating or a plain “roll-of-the-dice”. People I know in the market have no idea of what they own – no concept of the crap on the balance sheet. I find ZH to be one of the three or four best sites and am amazed how the MSM is now pushing all this traffic his way – Great Job Tyler..

Posted by Gerd Berg | Report as abusive

The few responses I could stomach here were all from sheep.The sheep are asleep in the field, while the Shepard fleeces the flock.

Posted by K Ackermann | Report as abusive

Felix, looks like you just got your ass handed to you in the comments.

Posted by ha ha ha | Report as abusive

Felix, You have got this all wrong. ZH is unmasking criminal market manipulation.”If you’re not part of the solution, you’re part of the problem.” Get a clue, Felix.

Posted by leftback | Report as abusive

Felix Salmon — I quote you alongside your fellow MSM shills here: 2009/10/02/defending-goldman-sachs-joe-h agan-msm-shill-vs-zero-hedge-blog/Defend ing Goldman Sachs: Joe Hagan (MSM shill) vs. Zero Hedge (blog)In this month’s NY Mag story, Joe Hagan continues to defend Goldman Sachs by attacking Zero Hedge blog and its 330k/month readership. Simultaneously, Justin Fox is supporting the hit-piece at his blog – arguing that readers of Zero Hedge are “paranoid nutters” who engage in “conspiracy theories” which — most damningly — are only right “once in a while”.[...]According to Hagan’s narrative, Ivandjiiski (AKA Tyler Durden) became “emboldened” by increased site traffic and began to write more-detailed postings, outlining his “radical notions” of un-manipulated markets and governments. Thus “Zero Hedge’s popularity metastasized with its increasingly paranoid focus.” Soon, we are told, Ivandjiiski was seduced by the site’s ad revenue and “a newly minted sense of his own importance”, and Zero Hedge became, as Reuters contractor Felix Salmon would write three days later, a “Dan Brown novel” for “delusional retail day-traders”.[Continues...]

Posted by TC | Report as abusive

Jeez, you reuter’s salary men are so damned envious of zero hedge’s success.But must you be so obvious about it?

Posted by phil_hubb | Report as abusive

Go back to 4chan Felix, you are way over your head here. If you can’t handle unbridled ideas and discussion then get out of the kitchen. Your political correctness and broad judgment serves no purpose and has no value.

Posted by RS | Report as abusive

Avid intellectuals who follow multiple streams of media would find this article a bit ignorant. For “pop” culture to catch on to a intellectual’s website; than attempt to judge that website on the basis of one perception is a lack of understanding of macro/micro trends in global economics/politics. Maybe there attempting to hack at the “hits” of the loyal avid “day-trade losers” who must follow everything written on the web.

Posted by T | Report as abusive

There seems to be a consensus among the media types that Felix Salmon finds respectable that Paulson, Bernanke et. al. saved the world a year ago by giving money to failing, too-big-too-fail banks and their bondholders, that the current administration, advised by many of these same wise people, is continuing this heroic work, that these disinterested public servants are still saving us all from an economic apocalypse, that their success is proven by higher stock prices, and that their failure to tie any kind of reform of how these banks do business to the massive outlays of taxpayer money used to rescue them had nothing to do with their personal agendas and loyalties but was simply an oversight that may still be corrected down the road once the world is saved. All of these assumptions are rarely challenged or even examined outside of the blogs that Felix Salmon denigrates, but they seem suspect to many people who care about these issues and spend a lot of time thinking about them. For the most part, these are people who do not benefit very much, directly or indirectly, when these banks make large profits. To them, the reluctance of the mainstream media to question these assumptions is a serious failing that feels like a passive form of the cheerleading that occurs all day long on the cable stock market shows. Portraying the difference between mainstream media and bloggers as a clear matter of right vs. wrong thinking, with bloggers as disreputable conspiracy nuts and plugged-in jounalists as serious intellectuals who give powerful bankers and politicians the respect their positions entitle them to, also seems like bad faith to these people. There is a divide, however, and Felix Salmon needs to decide which side of it he is on. This is a problem for him, no doubt, because being on the wrong side will certainly affect his career prospects.

Posted by bob | Report as abusive

Have you no shame? The mainstream media herded the population like sheep for decades. Rarely questioning the soundness of our economy or the undue influence and recklessness of the major banks.The financial blogosphere saved my ass. When I felt that something was amiss in early 2007 – it was the blogosphere that painted me the REAL PICTURE. And losers like you after the fact say things like “no one saw this coming!” LOL…You, Felix, et al, did nothing. I read you guys for entertainment; the blogs for info. Yeah, I have to sift thru the blogs, but it’s a hell of a lot easier than believing a captured MSM.You let us down MSM… it’s no surprise your viewership is dropping fast. Off to the trash heap of history for many of you. Good riddance. And by the way, whatever your salary is Felix, it’s too much.You guys in the MSM failed us – so please stop your whining.

Posted by GK | Report as abusive

These blogging sites took-off the same day your ad revenue fell off a cliff.Reuters, Bloomberg, WSJ, and-the-like, and all-in-unison, chimed in on the “green shoots” thesis in order to save their bottom lines.You sacrificed your integrity, started cheerleading and only reported the positive.Your audience saw right through it and left in droves. The same has happened with newspapers and MSM.The audience is NOT stupid; but you seem to think so – at your peril…

Posted by Peter | Report as abusive

Felix, I think I can provide some perspective here. I am a regular reader of ZH, but am also an “industry insider”, on the regulatory side, where I have the ability to verify much of the information on ZH. Tyler does in fact post relevant and useful information, and is often the first to major stories. ZH has been an important source in our regulatory efforts (ref. high frequency trading), and while Tyler and Marla and co. aren’t always right, they are well-informed and insightful enough that they are worth paying attention to.As opposed to the ZH commenters. A more emotionally unstable and ill-informed crowd you will have a difficult time finding on the internet. Next to them, the BusinessInsider/Clusterstock crowd looks positively intelligent; even the Dealbreaker crowd looks good by comparison (and it’s telling that the Dealbreaker minions, who constitute real industry insiders, have nothing but contempt for the ZHers.)I have made efforts to have an intelligent dialog with the ZH crowd (excluding Tyler and the other principals), and it’s a losing battle. It is nothing but hysterics, and it’s painfully evident that only a handful have relevant experience and useful insights. As such, I stick to just the posts from the ZH principals, and skip the comments entirely. At least the DB comments can be entertaining; the ZH comments don’t even have that going for them. I don’t think I’m alone, and my suspicion is that ZH is read by a large number of industry people, but most of them, like myself, waste no time in the comments section.

Posted by PV | Report as abusive

…as opposed to the calm, rational sociopathology of institutional traders and the market-makers.

Posted by TC | Report as abusive

one of the commenters here said: “Sigh. For gosh sakes, get your facts straight. Dan is NOT Tyler. At best, he is a contributor. Nice try, but a big strike out. There were a few clues way back as to who the original TD really was, but fortunately, those even those random clues have been removed.”I’ve read zh since just about day one (stumbled upon it somehow) and I clearly remember the clues (actually the identity issue was likely an oversight/error) referenced in the quote above. The person Daniel Ivandjiiski who is referred to as “the TD” by Hagan and the NY Post is most likely not from the information that I recall. Then again, it doesn’t really matter as I don’t know any of these people and am much more interested in content and the points of views expressed. It’s the message vs. messenger, “Publius” thing for me.I read approx. 10 hrs per day (unemployed/semi retired from financial sector)from very diverse sources about finance, economics, politics and zh is daily stop, wherein I read most zh articles. I am not a daytrader. I don’t find the site geared at all to daytraders but rather to people interested in finance/politics who know that the underbelly of the street and politicians has always been pretty dirty and are curious to hear more about it. I cannot ever recall seeing ZH make any particular investing decisions.Frankly, I view them most favorably as very smart rabble rousing patriots exposing the financial charades and chicanery between the financial and political communities in the USA to the detriment of most US citizens. ZH (as well as other blogs) has brought to the surface many matters that the established financial media have either missed or failed to report or perhaps, just maybe, felt pressured not to report because of financial pressure or interests from ownership groups or related parties. I think the odds of ZH exposing additional interesting matters to the general public will be much higher than what I expect from the established financial media.I’m convinced they are doing the honorable duty because they are making a hell of a lot of people very, very uncomfortable and ultimately that is a great thing for the USA.

Posted by DH | Report as abusive

ZH frequent reader.ZH is the best financial blog ever.You should be ashamed for assuming people are stupid.

Posted by capitan_mex | Report as abusive

“Who are these people who flock to and lap up everything they’re served?”–Felix SalmonThe distortion, through which anyone sees and mistakenly attributes to ‘others’ may merely be an aspect of our own reflection, unrecognized. Contemplate and possibly recognize this, if you will, “Ignorance created gods and cunning took advantage of the opportunity.”

Posted by joe blow | Report as abusive

Felix – your vitriol directed at ZH comes across as envy.

Because of course when you work for the MSM you check your journalistic credentials at the door and you become a sycophant to the corporations.

Sure you probably think what you write is real critique – but is it really – how far are you allowed to go without being slapped in the head by your editor – and eventually shown the door?

The reason I read ZH is because the MSM has let me down – most of what I see that passes for financial news these days resembles verbatim press releases (propaganda) from govt officials/central bankers.

There is for the most part no analysis and no questioning.

Case in point – recent 14% increase in China exports. Trumpeted across the home pages of MSM sites.

I immediately said whooooaaaa there… the EU is a wreck and the US stagnant. HOW is China growing exports?

But nope – none of the MSM sources asked that question – they just printed the BS without a second thought.

Another case in point – Fracking – the MSM reports this as if it were the 2nd coming of Christ.

Next to nothing is said about 1. toxic side effects 2. that is is hugely expensive and most importantly 3. I am not seeing any MSM suggesting that we are without a question at Peak CHEAP Oil because otherwise why in the hell are fracking, drilling miles beneath the sea and tearing apart the entire province of Alberta – to get at oil that is VERY expensive to extract?

When I go to ZH I get THE ANSWERS. That site will increase its traffic in direct proportion to the failures of the MSM to report accurately.

Posted by Roadhouse | Report as abusive

“Con la entrada en vigencia del acuerdo hoy hay cerca de 18 aos de proteccin para el sector lcteo colombiano que hay que aprovechar para hacer la transformacin de la industria lctea colombiana”, agreg por otra parte el ministro.

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