OLD Media Moves

A crystal ball in financial reporting?

April 7, 2010

Jason Linkins of The Huffington Post was one of the journalists in attendance at the “Facing the Fracture” conference at Columbia University that discussed the media’s coverage of the economic meltdown of the past two years, and he reached his own conclusions about what happened.

Linkins writes, “Chrystia Freeland is probably right: it’s too much to demand ‘crystal ball’ clarity from the media. But to impose a better psychic metaphor, it’s not impossible to do a better job reporting out the position of the tea leaves at the bottom of the cup. It seems pretty clear to me that the looming disaster in the credit market might have been unwound if greater attention had been paid to massively overvalued real estate, but the unwinding requires reporters to find out some basic things about what’s going on, like who is paying these insane sums for urban shanties, why they are doing it and how they are paying for it.

“(Also, we needn’t be so esoteric here. Are the price to earnings ratios ridiculously out of whack? Are the best selling books on the subject crazy in their triumphalism? Is every single MBA student attempting to mine the same crowded field? If the answers here are ‘yes,’ then something terrible may lurk just around the corner.)

“Not every glitch leads to a larger disorder, but just about every disorder starts with one. I think the rational response to the media’s larger failure to cover the 2008 economic crisis is to commit more on-the-ground resources to those glitches. Once you are going door-to-door on that block of overpriced hovels in Washington, DC, it’s easier to disconnect from cognitive capture and the tyranny of expertise. Unfortunately, resources are very scant to support this kind of reporting, and even if they were, it’s not clear that anyone would be very interested in doing this.”

Read more here.

Subscribe to TBN

Receive updates about new stories in the industry daily or weekly.

Subscribe to TBN

Receive updates about new stories in the industry.