Media was easy on Wall Street during '87 crash

Marketwatch media columnist Jon Friedman writes Friday, the 20th anniversary of the 1987 stock market crash, that Wall Street got off easy in terms of the media coverage of the event and doubts the same would happen today.

Friedman wrote, “While a journalist’s first instinct is probably to convey the frenzy surrounding a market meltdown, common sense would ultimately prevail — yes, even in the print, online and broadcast media.

“You could make the case that today’s business reporters have a deeper understanding of how the markets behave. They’d be better equipped to explain why the stock market collapsed and what it might need to recover.

“Having the events of the relatively recent October 1987 and afterward as a blueprint, the media could trace the historical implications of a stock market crash. Remember, 58 years — a lifetime — elapsed between the destructions of 1929 and 1987.

“‘Financial journalists are more willing to engage in understanding the mechanics of the market and explain why it may behave the way it does,’ [Rob] Cox of Breakingviews.com said. ‘So, if we are willing to get a handle on things like portfolio insurance, statistical arbitrage etc., we can avoid some of the breathless, sensational markets coverage that reinforced the sense of panic among investors. At least, I hope we can!'”

Read more here.