The mainstream (corporate) media is nothing less than the unofficial accomplice of the banking crime syndicate which is running/ruining our markets and economies. Nowhere is this despicable relationship more apparent than in its deliberate efforts to grossly misinform investors on the critical subject of risk.

I partially dealt with this issue in a previous commentary titled “Volatility Does Not Equal Risk”. In that article I did something which you will never, ever see the mainstream do: I provided an explicit and detailed definition of the term “risk”.

I would encourage even those readers who read the original piece to re-read it, as I simply don’t have the space to repeat that multi-paragraph definition here, and (as I always stress) definition of terms is a crucial prerequisite to understanding any concept. Equally important, that previous piece clearly distinguishes the entirely distinct concepts of “volatility” versus “risk”. In contrast, one of the principle propaganda assignments given to the mainstream media has been to entirely blur the distinction between volatility and risk.

In its simplest form, “risk” (in the realm of investing) refers to two interrelated probabilities: the probability of suffering a loss on the investment, and the potential magnitude of such a loss. Conversely, “volatility” (i.e. what an investment does in between the day one buys and the day one sells it) is totally irrelevant. A simple example will illustrate this principle.