Dana Blankenhorn

China

It’s in to hate China.

Jim Cramer, confusing Karl Marx with Groucho, keeps referring to the government of Xi Jinping as “Communist China.” Its efforts to fight tech monopolies there cost him money in Didi Chuxing, China’s Uber.

China is also a great whipping boy for neocons who want to get their war on after Afghanistan fizzled. They point to its crackdown in Hong Kong and the ongoing genocide in Xinjiang. Those are terrible crimes. But are they that much worse than Shock and Awe, or the ongoing beatings of protestors by our police?

These crimes cost China more than reputation. They cost money. Chinese taxpayers are in deep doo-doo already. The Sinovac vaccine turns out to be garbage. You can see the air, which is not supposed to happen. There are floods of Biblical proportions in brand-new Chinese cities. Economic growth is slowing. The stock market is down, so wealth is down. And you can’t trust the Chinese Internet, which is a bigger spy than even Facebook.

If things were like this in America, we’d be revolting. Critics like to insist that you can’t in China, but it ain’t necessarily so. China can’t match Taiwan’s semiconductor technology, despite buying its engineers with fat bonuses. Its biological technology is nowhere. Its science publications are rife with cheating, which means its papers are rife with lies.

The Dictator’s Internet Advantage

“Credibility is the coin of the realm.”

That’s what Northwestern’s Medill School taught me, when I was getting my Master’s in Journalism back in 1978. (That's also when this picture was taken.)

This was reinforced during our school trip from Chicago to the media capital of New York. I literally sat at the feet of William Shawn, then still editor of The New Yorker. We were paraded through the offices of Time. We sat for a spell at the Top of the Week, a bar on top of Newsweek’s headquarters building. The lesson was that someday all this would be ours if we were just loyal to our employers.

I’m the last member of my graduating class still be working a beat because I didn’t believe a word of it. Credibility is a personal value, I argued. It’s not something that can be granted, like a knighthood.

But American media companies remain wedded to the idea of credibility as a corporate value. It’s why so few are international in scope. That’s because credibility, in media, is mediated. It’s a continuing negotiation among media companies, their audience, and government. It’s a balancing act.

The New Journalism Business Model

I have been telling journalists for a quarter century that they needed a new business model.

Stop worrying about advertising, I said in 1996. Think about earning commissions from your business partners.

Someone finally listened. Ric Elias runs Red Ventures, doing precisely what I said back then needed to be done.

I could point the way, but I couldn’t do it. I prefer writing stories to anything, especially running a business. I should have taken the advice of the late George Heitz, who at my first j-school lecture in 1977 said that Northwestern had a business school right around the corner.

No regrets. I’ve had a good career. But I’m proud to bursting over what Elias has done, in the Charlotte suburb of Fort Mill, SC. He has focused on consumer lifestyle brands, buying them slowly as their ad-based business models collapsed. Healthline is now Red Ventures. So is Lonely Planet. So are ZDNet and CNet, where many of my old colleagues with the Internet Press Guild still work.

Elias leaves the writers alone. Good journalism draws readers and builds communities. That’s always been its main function. The question is how to capitalize on that.

Red Ventures seeks commissions on credit cards, on services, on products sold on Amazon. The New York Times, in a dismissive piece about it, talked at length about Elias’ life story, the early days of using telemarketing, a supposed dependence on credit cards for revenue.

Know When to Sell

There’s a big difference between your nephew Billy, the Reddit investor, and the pros.

The pros know when to sell.

It’s true there are some things you Hold On to for Dear Life (HODL). These are stocks in good companies with good managements and good stories to tell. Companies like Amazon or Apple or Microsoft. This is what I’ve now learned from 10 years writing about investments, from the time the ad-based tech news business collapsed, and I got kicked off the beat.

You won’t find the winners right away. But if you’re nibbling on a few big names every month, and if you’re serious about winnowing out the non-performers once a year, the names will emerge. Sometimes, as with Google or Moderna, it seems obvious when they come public. With others, it can take time. You might find yourself selling, then buying, then selling again before you settle on something. I lost money on Apple during the 1990s, because I didn’t buy Steve Jobs’ return as I should have. Amazon didn’t pass its 1999 peak for over a decade.

The lesson of selling is especially important now, with so many young investors getting wrapped up in things like Reddit’s WallStreetBets forum.

I’ve got nothing against WallStreetBets. If you get a gang together to attack a stock (or anything else) you can make it move. Hedge funds do it all the time.