Firstly, some admin news: I’m seizing the moment to take a blog hiatus for the next few weeks. I’ve prepared a full set of infographics and recaps to post themselves while I’m away – but I won’t be writing fresh each morning. I might do the occasional post if something really hectic happens in the between now and mid-June – but that’s…unlikely. 

Two of the most iconic news pieces from the last month were these:

  1. Unmasking the Men Behind Zero Hedge, Wall Street’s Renegade Blog (from Bloomberg); and
  2. The Full Story Behind Bloomberg’s Attempt To “Unmask” Zero Hedge (ZH’s response).

For those who don’t know the website, Zero Hedge is a strongly anti-establishment news/blog site, filled with apocalyptic realness.

clown realness

It’s where you’d go to get your Fed-bubblecovery jollies, and all those chills associated with America’s debt burden and the imminent-for-some-years-now crash.

The main blogger on Zero Hedge is Tyler Durden, of pseudonymistic Fight Club fame. And most importantly:


Only, it turns out, there were three people (until recently) who were posting as Tyler Durden, and then one of them…actually talked about it. To Bloomberg. Here.

Specifically, those three people were:

  1. Colin Lokey (the guy who got disgruntled and blabbed);
  2. Daniel Ivandjiiski, a Bulgarian-born former analyst; and
  3. Tim Backshall, “a well-known credit derivatives strategist”.

So here’s Bloomberg on what the site is:

Since being founded in the depths of the financial crisis, Zero Hedge has grown from a blog to an Internet powerhouse. Often distrustful of the “establishment” and almost always bearish, it’s known for a pessimistic world view. Posts entitled “Stocks Are In a Far More Precarious State Than Was Ever Truly Believed Possible” and “America’s Entitled (And Doomed) Upper Middle Class” are not uncommon.

The site’s ethos is perhaps best summed up by the tagline at the top of its homepage, also borrowed from Fight Club: “On a long enough timeline the survival rate for everyone drops to zero.”


And then there’s the scandal.

First up, the allegation that ZH headlines are specifically designed to generate web traffic #clickbait:

Despite holding itself out as a town crier for market angst, transcripts from Zero Hedge internal chat sessions provided by Lokey reveal a focus on Web traffic by the Durdens. Headlines are debated and a relentless publishing schedule maintained to keep readers sated.


“Reality checks are great. But Zero Hedge ceased to serve that public service years ago,” Lokey wrote. “They care what generates page views. Clicks. Money.”

On Putin as a good guy:

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.

And the ending:

“I can’t be a 24-hour cheerleader for Hezbollah, Moscow, Tehran, Beijing, and Trump anymore. It’ s wrong. Period. I know it gets you views now, but it will kill your brand over the long run,” Lokey texted Ivandjiiski. “This isn’t a revolution. It’s a joke.”

Zero Hedge’s Response

Basically, the entire article is a set of discrediting screenshots of the messages sent by Colin Lokey to various members of the Zero Hedge squad. Said screenshots? Well, they appear to be a public display of Colin repeatedly falling off the teetotalling bandwagon (although, who knows if they’re real – it’d be pretty easy to set-up a fake message chain).

Here’s Colin “begging for his job”:

Lokey begging for job

Colin “the coke dealer”:

colin coke dealer

Colin threatens to shut ZH down:

shut it down

Who knew that it could all get so real?

How real though.

you're insane

The Point

The point is this: irrespective of whether you think Colin is crazy, or Zero Hedge is crazy, or both are crazy, the one thing that isn’t denied is how headlines drive web traffic. And in particular, how those heavy-hitting conspiracy-theory-esque headlines are so good for business.

As Zero Hedge says:

We are ok with being typecast as “conspiracy theorists” as these “theories” tend to become “conspiracy fact” months to years later.

But if you read that in combination with:

Screen Shot 2016-05-27 at 9.00.51 AM

Then really, all that you get is “bad news is inevitable”.

Here’s an example, if I spend the next 70 years forecasting my death, then I’ll eventually be right. That’s not in question. In the same way: market crashes happen, market bubbles happen, dictators and democracies both rise and fall.

But would my life be any better for regularly forecasting my imminent demise, year-on-year? Well, no – no it wouldn’t. If I were constantly living in expectation of death, then I wouldn’t bother to invest my savings, or invest in longer term relationships/assets/anything-with-a-time-horizon-really.

And that’s not an especially wise way to live. It’s far too one-dimensional.

Which brings me to my final word-of-caution/lament: there appears to be no room in the blogosphere for moderation. If you want to have a voice, then you have to be extreme. And that’s because considering things in a multidimensional space is boring. It means that you have to say things like “on one hand…on the other” and then plead agnosticism. Only, that doesn’t get you headlines.

So what I’m really saying is: we need to take a great many more pinches of salt when dealing with headlines. They’re (apparently) designed to specifically grab our panicked attention.

Also, we ought to panic less.

Happy Friday.

Rolling Alpha posts about finance, economics, and sometimes stuff that is only quite loosely related. Follow me on Twitter @RollingAlpha, or like my page on Facebook at Or both.