“I’ve made up my mind; don’t confuse me with the facts.”
The best source we can find for the above quote is the November 1945 issue of Advertising & Selling, in an article titled “Don’t Confuse Me with Facts!” by Roy S. Durstine. His article contained just the second portion of the statement: “Don’t confuse me with facts!” The first clause in the quote, “I’ve made up my mind,” was implicit in the context of the anecdote he relates. Durstine may have protected the identity of the person who first muttered in a meeting, “Don’t confuse me with facts;” or indeed, that statement may have been a meme floating around in the culture long before Durstine penned his article. We do know that versions of the full saying were being imprinted on signs and cards by 1954.
Let’s get to some facts about President-elect Trump’s Dec. 12 tweet about Lockheed Martin’s F-35 stealth fighter and Lockheed share-price volatility. Here is a copy of the tweet: cumber.com/wp-content/uploads/2016/12/img_0443.jpg.
Also depicted is a Lockheed stock price history posted by David Axe, who blogged on 12/13/16 that “Someone Began Dumping Stock Before Trump Attacked Lockheed” (https://medium.com/defiant/someone-began-dumping-stock-before-trump-attacked-lockheed-65af1fba8165#.qxnbv8lzw). Axe got the price history and the idea of its putative connection to the Trump tweet from another blogger, Christopher Bouzy.
The Axe blog took the matter viral, and other bloggers piled on. Anti-Trump forces seized upon the conclusion that insider trading was involved. They had “made up their minds.” Some of them actually invited evidence to be established to the contrary. In other words, they challenged the blogosphere to prove a negative.
Well, we cannot prove a negative, as anyone with even a smidgen of philosophical training knows. But we can do some research; we can draw some inferences; and we may even be able to point to some facts. We got some help in that endeavor from our colleague Donna Marie Valles, who is on our trading desk and has some facility in the use of Bloomberg data.
Donna M found that 18 trades occurred in the pre-market period before the famous tweet. They were mostly for small amounts and included several odd lots. The prices ranged from $258.89 low to $260.87 high. A small trade at $258.90 occurred at 8:17 AM; that was the lowest price right before the 8:26 AM time that appears on the tweet itself.
No trades are listed in the Bloomberg database between 8:21 AM and 8:26 AM. At 8:26 and 23 seconds, a small trade is listed at $258.57. It is followed by 18 other trades in the 8:26 time slot. By the end of the 8:26 series of trades, which spanned 48 seconds into the one-minute period, the price had fallen to $256.68. In other words, the stock price traded down after the tweet. So, if no trading occurred in the 8:21–8:25 period highlighted by Bouzy and Axe, we have to suspect the accuracy of their allegations and the conclusion they reached.
After the tweet, the pre-market price continued to fall, with a total of 655 trades that ranged from the $258.57 high at 8:26:23 to a $250.75 low at the conclusion of pre-market. Once the market opened, over 6 million shares traded, and the low intraday price was $245.50. Note that the stock price recovered partially during the day.
It is possible that a Rule 611 trade occurred during the time window of 8:20 to 8:26, but it is highly unlikely. Such trades are usually linked to a derivative and are therefore not in the time and date reporting sequence.
The bottom line from the evidence we are able to obtain is that the allegation of a “Trumpsider” trade in Lockheed is unfounded. There is no evidence to suggest that it occurred. Blogger Bouzy leapt to an erroneous conclusion; blogger Axe multiplied it; and the blogosphere ran with it.
Our purpose here is not to defend the president-elect, nor to castigate bloggers for posting their opinions. The greatness of our America is that it permits the expression of opinions.
Our purpose is to note that there is a difference between an unconfirmed claim and a fact. Before we leap to conclusions, it behooves us to investigate the evidence. If we take matters in that order, facts clarify rather than confuse.
We wish our clients, referring consultants, 40 staff member household families, fishing buddies, friends and all social media and email list readers & followers a safe and festive new year celebration.
A list of all December yearend writings will be released in early January.