The magazine cover effect

Barry Ritholtz writes about the psychology and market connotations of being a CEO who is named Time magazine’s Man of the Year.

Ritholtz writes, “It is somewhat fitting that a decade after Time marked the very top of the internet bubble by putting Amazon’s founder, Jeff Bezos on the cover as person of the year in December 1999, this year, they opted for Facebook’s founder as their 2010 Person of the Year.

“If history holds, TIME has just marked the top in the value of Facebook — at least for the foreseeable future. The Bezos cover marked the high point in Aamzon.com’s stock for the next 10 years.

“Understand the psychology of why this is: By the time any phenomena reaches the editorial room meetings of a major non business publication such as Time, it is already a widely held social factor. (1999 Example: Buying books and other gadgets on the internet? Why you don’t say– that’s ingenious!)  Ubiquitous Facebook has 500 million users, is now at the point where its early and middle adopters are cringing as their parents sign up and ‘friend’ them.”

Read more here.