Zero Hedge Anonymity Policy

August 22nd, 2009 12:07 am | by John Jansen |

That is the title of a posting at the Zero Hedge Blog today. The blog wraps itself in a veil of secrecy and the author/authors made the blog the story today as it described “mainstream media ” attempts to penetrate its veil of secrecy.

Several weeks ago that blog and myself engaged in what one commentator described as a “dustup ” regarding the Open Market Desk purchase of some recently auctioned seven year notes. It was at that time that I discovered that the principal author’s name, Tyler Durden, was a nom de plume  based on a character in  a novel and a subsequent movie.

Tyler had e mailed me earlier in this year and  I could not (at that time) fathom why the he had signed his name “Tyler”. Now I know.

Well I have a problem with anonymity and  a special problem with anonymity when the anonymity comes from a blog with a penchant for pyrotechnics.

We are an amalgam of our life experiences. Our opinions and biases derive from who we are and what we have done in our lives. A myriad of forces shape and transform us and, in my opinion, readers deserve to know something of the background of an author(s) of a blog.

In the discussions in the blogosphere several weeks ago regarding an alleged conspiracy between the Federal Reserve and the primary dealer community, several of those who commented on my writing described me as biased and an apologist for the Federal Reserve. Those writers referred to the resume at this blog as well as the resume which appears at the Seeking Alpha site which publishes some of my work and which states openly and honestly that I began my bond market career at the Federal Reserve Bank of New York.

I do not think I am an apologist for the Federal Reserve but I certainly have a bias in favor of that organization. Observant readers drew the not totally unfair conclusion that my work at the Federal Reserve would leave me with a bias in favor of that organization.

Regarding the Zero Hedge blog, one can not engage in a similar exercise.

If the blog confined itself to discussing macroeconomics, finance and trading the veil of secrecy might not be so offensive to me. But the authors of that blog have made some very serious charges. For instance, that blog has accused the Federal Reserve and the primary dealers of conducting a criminal conspiracy in the Federal Reserve’s conduct of Open Market Operations.

I believe that if one makes that type of serious accusation then the accuser should make his or her identity known so that readers can ascertain his/her motives and biases. To not do so is an act of cowardice and allows the authors to make sensational charges for the purpose of driving traffic without fear of  adverse consequences.

There is a final grand irony in all of this. No it is more than irony; it is hypocrisy. The proprietor(s) of that blog have filed Freedom of Information Act requests with the Federal Reserve. They are seeking to penetrate that organization’s veil of secrecy while they remain hidden in the the shadowy recesses of cyber space.

If the author(s) of  that blog have any decency or integrity, they can demonstrate it by lifting the veil of secrecy with which they cloak themselves.

Update: Felix Salmon and Naked Capitalism visited this story earlier on Friday. And you will note that the first comment in the comment section links to a New York Post story which I guess started the ball rolling.

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  1. 27 Responses to “Zero Hedge Anonymity Policy”

  2. By Hugh Jardon on Aug 22, 2009 | Reply

    your antagonist’s identity has been published:

  3. By teia on Aug 22, 2009 | Reply

    well somebody touched a nerve.

  4. By Charles Davis on Aug 22, 2009 | Reply

    There is a slight difference in the levels of responsibility and expectation (nay,requirement) of transparency between a quasi-government organization with the ability and mandate to fundamentally effect US and global economy, and a financial blog acting as a (potential) whistleblower. Maybe future prosecution witness. ZH is not the investigating agency, not the prosecutor, not the judge or the executor of any verdict, where a lack of bias is a reasonable expectation.

  5. By Charles Davis on Aug 22, 2009 | Reply

    Sorry, that was meant to say “affect US and global economy”

  6. By Eric Davis on Aug 22, 2009 | Reply


    and that he/they have some kind of un-natural obsession with Brad Pitt.

    There also seems to be some kind of “Sour Grapes” bias toward the financial community. I find that not entirely un-justified.

    But that it may be that the antagonist feels like what he did doing insider trades, is nothing compared to what Citigroup and Goldman do. It’s one of those moral dilema’s Where “Well sure I cheat, but I have to get back at the other Cheaters.” The ends justify the means.

  7. By AnonymousMonetarist on Aug 22, 2009 | Reply

    Recently I commented to a relative going to college who was bemoaning high school cliques … ‘well ,life is like high school: the cool kids vs, the nerds, the tyranny of petty, the treehouse rules, the inability to embrace failure and recognize that luck constitutes a large part of success and the tendency of groupthink to ostracize thoughts or actions that challenge the consensus…

    Anonyminity if maintained removes a lot of ego and hubris from the equation. Though my lens it would seem that a lot of criticism towards ZH flows from the lens of folks who claim that they own the treehouse rules for blogging.

    If advocates of the blogosphere see themselves as an important dialetic how is that sentiment advanced by attaching a CV to your ideas?

    Anonymity is a warm blanket that allows folks to speak truth to power and not be killed for it.

    I’m based in Chicago and have run an exotic trading desk for five years. As the only reference point for this asset in Chicago if I put my CV on my blog it would restrict what I could say without offending some partners. Sad but true.

    I don’t profess to be anywhere near the caliber of ZH, my blog was initiated on the advice of Faber who suggested that you need to keep a file system … my blog is my file system… but don’t we want vehicles where folks can contribute under a pseudonym and not fear the retribution of the petty tyrant?

    Sunlight is the best disnifectant but you don’t need to know the life history of the fella opening the window shade to appreciate the warm wisp of truth …

    Discerning minds know truth when they see it.

    Arguing the difference between credit easing and monetization of debt is akin to debating the merits of left-handed versus right-handed torturers …fella on the rack doesn’t really appreciate the difference.

  8. By rCJ on Aug 22, 2009 | Reply

    I think that if ZH wants to remain anonymous, and suffer the skepticism and questioning of motives inherent in their anonymity, that is their choice.

    In a world with huge discrepancies of power and control and wealth I think anonymity is worth preserving. You are right to question motives of the anonymous pamphleteer but the US (with all its flaws) owes so debt to anonymous pamphleteers.

  9. By Gary on Aug 22, 2009 | Reply

    Comparing the secrecy of Zero Hedge to the Federal Reserve is like comparing apples and oranges. Nobody is compelled to read Zero Hedge. Everyone is the United States is subject to and affected by the policies of the Federal Reserve.

  10. By krb on Aug 22, 2009 | Reply

    You’ve lost substantial credibility by your inability to distinguish between the secrecy of ZH and the Fed……come on. I could describe this dust up to my two teenagers and they’d get it.

  11. By Scott on Aug 22, 2009 | Reply

    Anybody who has ever worked on the Street knows from the writings of “Tyler Durden” that those folks are extremely experienced. To get that experience, you’re also either well connected, or have been well connected.

    I suppose it’s possible a 30 year old copping to a $700 insider trading charge is the mastermind behind the ZH operation. But I just don’t see it. In some cases, the topics they write about are pretty esoteric and require many years of experience to develop the specialized knowledge to write about the topic accurately. Does a 30 year old, probably 5-8 years out of B-school, who has been barred from the securities industry, have the pull to assemble together a team with the experience those folks obviously have? Possible, but doubtful.

  12. By USConstitution on Aug 22, 2009 | Reply

    Is this blog funded by the Fed? I mean the time spent being a Fed apologist can’t be for free. Just curious. The commenter Gary has it right about the comparison between ZH and the Fed secrecy.
    ZH does not have limitless power to dilute currency at will while your past/present unconstitutional employer does.

  13. By Nemo on Aug 22, 2009 | Reply

    Actually, Scott, I have been assuming that “Tyler Durden” is an MBA student with too much time on his hands… I do not have expertise in everything he/they write about, but where I do, I can tell you he is almost always blowing smoke. I am frankly surprised to learn he is older than 25.

    Regarding anonymity in general, I disagree with Mr. Jansen; pseudonymous writing has a long and distinguished history in the free world. I myself have chosen to be judged by my writings alone.

    But in return, I judge others only by their writing, not by their resumés. Mr. Jansen is correct that it is ridiculous for an anonymous author to attack him based on his employment history which he freely presents. What matters is what Mr. Jansen says, not what his motives are. In the recent “dust up” it was quite clear — in case it was not already obvious — that one of the participants is a genuine expert while the other is a poser.

  14. By krb on Aug 22, 2009 | Reply

    Nice try Nemo. Without even knowing Mr. Jansen I can tell you that “genuine expert” is an overstatement. But I guess that depends on each of our definitions of “expert”. The world is full of people who can report published statistics and repeat trade desk rumors or suspicions from professional contacts. And that certainly provides value and is why I read him, but let’s not overstate it.

    On the base issue it appears by your comment we may agree….whether the messenger is anonymous or not is frankly a silly issue. It seems to me beneath anything a “genuine expert” would choose to waste their time on……if the suspicion or claim is false it will be rooted out soon enough……and if it’s true, all the better that someone at least raised the suspicion?

    Where I disagree is in your characterization of Mr. Jansen and by extension his credibility in trying to discredit ZH. To defend the Fed against the claims made by ZH by arguing “it sure would be hard to pull off”, and then to miss the relative differences in their obligations to be transparent, was very shallow thinking…….certainly unworthy of what I understand to be a “genuine expert”. As a regular reader of Mr. Jansen I was very disappointed at the depth of thinking (lack of).

  15. By Farah Fawcett on Aug 22, 2009 | Reply

    Changing topics guys, can someone please help me with this tought:

    How can the spike in Asian trading volume of the 30y bond from last Thursday be explained?

    On August 19 Bloomberg reported that “China Banking Regulatory Commission had sent a draft of rule changes to banks on Aug. 19, requiring them to deduct all existing holdings of subordinated and hybrid debt sold by other lenders from supplementary capital. As a result of the rule changes, banks may need to curb record lending. Additionally, banks may be forced to sell shares to lift capital adequacy ratios to the 12% minimum.”

    I don’t know this guy “Zero Hedge, Tyler Durden, Brad Pitt or wathever his real name is” and I just barely know John Jansen (who seems to be a gentleman), but what I do know is that I need to make money. Please check this chart of the China Shangai Index vs TBT (1 month).
    Is just me, or the correletion between these two graphs is amazing!! Please I need some good comments…

    Your friend,
    Farrah Fawcett

  16. By OregonGuy on Aug 22, 2009 | Reply

    I can ignore ZH and be none the worse; the Fed affects my life and the life of every person in the country. Comparing the two is a non sequitur. Besides, accusing the Fed of being a criminal conspiracy is hardly new. Navigate over to Amazon and read the myriad 5-star comments for “The Creature from Jekyll Island”.

    In the final analysis, ZH is only a blog. Some bloggers are taking themselves way too seriously. As ZH itself is inclined to do.

  17. By Bond Girl on Aug 22, 2009 | Reply

    The use of a nom de plume and expertise are two very different issues.

    Most market participants who are capable of contributing positively to the discussion of the financial markets are prevented from doing so under their real names by the policies of their employers. I have never had an employer who was especially open to employees cultivating a public persona that was not actively vetted by management (which is why I’ve written anonymously before). Heck, I even had to get permission from the division management at my former employer just to do guest lectures at the b-school at my alma mater, which is a far more tame thing than what is covered on many financial blogs. I firmly believe that many of the problems in our markets cannot be solved by the government and will only be solved by market participants stepping up to provide some measure of accountability in the industry. The ability to publish anonymously in the blogosphere is helpful in that respect.

    That said, the authors of that blog do appear to be learning about the markets, and they should probably be more forthright about that rather than portraying themselves as experts as such. One of the things I first noticed about that blog was that the authors are constantly misappropriating market vocabulary and they do not seem to have a functional understanding of how financial institutions really work and how trades are executed. The idea of just publishing “tips” they receive without trying to verify them also bothers me. It is unfortunate that many of the people that come to the blogosphere looking for honest information end up getting swept into sites like that, which have obviously figured out that their sensationalism draws traffic. But this is not something one can stop, which is why one can purchase both the Wall Street Journal and tabloids at the grocery store.

    Thank you, John, for being one of the great places to get solid information on the financial markets.

  18. By Wallie on Aug 22, 2009 | Reply

    FF your charts would seem to suggest a conspiracy by the PRoC to manipulate our treasury rates. Someone should file a FIA with the PRoC ASAP to root out this conspiracy! And identify yourself immediately if you wish to preserve any credibility!


  19. By John Jansen on Aug 22, 2009 | Reply

    Bond Girl,

    Thank you.

    And what happened to your blog?

  20. By Michael on Aug 22, 2009 | Reply


    For the past few months, China and other emerging markets have been trading inverse to Treasuries. Thus, TBT (an inverse Treasuries ETF) would show the correlation to the Shanghai Stock Exchange that you see. It is a risk-seeking vs. risk-aversion trade. If the Chinese stock market crashes, I’m guessing that you will see Asian money start to flow back to the $ and the yen.

  21. By scaleindependent on Aug 23, 2009 | Reply

    Great post AnonymousMonetarist.

  22. By GreenAB on Aug 23, 2009 | Reply

    as stated before John – i love your work.
    but you´re going the wrong way.

    to me there is no doubt ZH wouldn´t exist in it´s current form if the authors (obviously wall street insiders) identities would be revealed.

    i´m not sure if you ever heard of “citiboy” who was the first anonymous blogger years ago who brought wall streets dark sides to the public.

    guess how much longer he would have worked on wall street once his name would have become public?

    if there´s somebody to blame for hypocricy then it´s the mainstream media.

    just turn on cnbc. how often does Gaparino (who´s going after ZH) quote his “sources” inside goldman, bac, aig… bringing up rumors that sometimes turn out true an sometimes they don´t.

    same with Liesman and his white house “connections”.

    so these guys are fine jounalists and can bring up whatever they want because “sources” told them.

    and now that the “sources” (and potential whistleblowers) are running their own blog without the need of the mainstream media middleman they are suddenly evil?!

    when judging ZH it´s the same with everey other blog: you have to think for your self and you need a little experience to seperate the good from the bad stuff.

    would the blogosphere a better place without ZH? certainly not.

    yes they are permabears and they´re doing some of the same spin they criticize.

    but they bring issues and third party reports to attention we wouldn´t normally see.

    btw: i´m a bit shocked that you admit a fed bias.

    always thought you (besides CR) are one of the few NEUTRAL blogs that tell things as they are.

    and they do not any harm to readers portfolios since they don´t promote buying/shorting certain stocks/bonds etc.

    so PLEASE – stop that silly hairsplitting war with ZH on how much debt the fed is going to buy.

    discuss about the ISSUE – is the fed monetizing the debt, do actions signal a silent pact with the PDs, how will all this printing(or not printing) turn out eventually, how should readers position to bring their capital through the next 5 years etc.?

    addendum: as far as ZH identity goes:

    at least they´re not denying being fed by pimco…

    thanks again for your your outstanding work!


  23. By Bond Girl on Aug 23, 2009 | Reply


    I decided to take down my blog because my responsibilities at my day job are making it impossible to maintain. I am sorry for any inconvenience, but I would be happy to email you some links to good muni market commentary if you would like.

  24. By cars on Aug 23, 2009 | Reply

    I believe that ZH will eventually become less about finance and markets and more about politics. That’s where they think the money is or perhaps that’s what their ambition in life really is. If you notice the claqueurs that ZH has been able to assemble in their peanut gallery, they don’t know much about finance, but they love to rant about conspiracies and the government. And they’ve been attacking any blogger that dares to question ZH’s accuracy and expertise in certain technical matters. So arguing with them is like talking to a dinner table.

  25. By kmw on Aug 23, 2009 | Reply

    Even if ZH is correct about the conspiracy with primary dealers it would not be criminal. As you know, the Fed – unique among all private corporations – enjoys sovereign immunity. It is, truly, above the law.

    Which makes everything else in this debate fairly irrelevant to me. Anyone claiming that kind of special regime will always enjoy the presumption of guilt in my eyes; why else would they need such extravagant privilege (to coin a phrase)? And with the ability to arbitrarily withhold information that might incriminate itself, no one can ever convince me of its innocence.

    I do agree with you that the people at ZH are given to bombastic prose and careless with the details. I do agree that getting the details wrong damages their credibility. Unfortunately for our now fading prosperity and way of life, it is not the details that ultimately matter. Given the sheer volume of money being printed, even the total profits of the great GS are but a pittance. What’s $250b to someone who’s just told the world he’s going to print $1.75t so that his buddies can give away another $2t to their preferred contractors and a civilian zombie army of useless government employees?

    Like you, I’m a trader. I don’t fight the system, I use it to make a profit. This blog provides knowledge and texture that’s valuable in that endeavour, and occasionally entertaining as well. But I also believe that this world would be a far better place without the Fed or central banks in general, so while I appreciate and understand your bias – and applaud you for acknowledging it – I don’t share it.

    ZH may be wrong about many or even most of the things it publishes. But it is very right about the amount of anger in our country today. If ZH can direct and focus that anger toward the Federal Reserve System, where much of it justifiably belongs, I believe that’s good for what’s left of America. Do not underestimate how much anger is out there. The Fed has had far too much power and far too little understanding and scrutiny from the public at large. This country is supposedly run by and for the people; they ought to understand what they’re being offered by the central banking, pro and con, and be offered a fair opportunity to take it or leave it at any time. It would be unfortunate if misinformation were the cause of its abolition, but not very much so as its founding was undertaken after a far better-coordinated campaign of misinformation by the banking cartel.

  26. By Carlos on Aug 24, 2009 | Reply

    John once again your bias shows:

    “I believe that if one makes that type of serious accusation then the accuser should make his or her identity known so that readers can ascertain his/her motives and biases.”

    If we go by your opinion Deep throat would have never happened and Nixon would had stayed as president ( I guess that would had been your choice ).

    “There is a final grand irony in all of this. No it is more than irony; it is hypocrisy. The proprietor(s) of that blog have filed Freedom of Information Act requests with the Federal Reserve. They are seeking to penetrate that organization’s veil of secrecy while they remain hidden in the the shadowy recesses of cyber space.”

    FOI is to force disclosure of actions by ELECTED officials so it is not the same

    What is your opinion on auditing the FED as some in congress want?

  27. By Bob on Aug 25, 2009 | Reply

    Thanks for all the ranting and raving. If it wasn’t for you all, I wouldn’t have discovered and engrained into my head that ZH is a waste of time. Their logic is barely above the caliber of whomever wrote the book about the US government planting explosives in the WTC so they could bring it down nice and orderly.

    Actually, maybe they did write that book, and explains why they are in hiding! See how easy it is to create conspiracies where there are none? 😉

  28. By sandra742 on Sep 9, 2009 | Reply

    Hi! I was surfing and found your blog post… nice! I love your blog. 🙂 Cheers! Sandra. R.

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