Former BusinessWeek reporter Gary Weiss, author of “Wall Street vs. America,” has an interesting post on his blog Sunday about whether business journalists should try to “call” a turn in a market or just present the facts and let the readers decide for themselves if it’s happening.
Weiss was spurred by an article in the Sunday New York Times where people in the real estate industry were quoted as being upset with coverage of their business, and he comes down on the side of avoiding market calls in coverage.
Weiss wrote, “I’m all in favor of market coverage, as I pointed out the other day, but the media should avoid ‘calling the turn,’ no matter how tempting that may be.
“It’s been shown repeatedly in countless academic studies that nobody can reliably forecaset either the broad market or the movement of individual stocks. So it’s time journalists got out of the ‘market forecasting business’ entirely, and wrote stories that pointed out the excesses of the market, both positive and negative. Then the reader can draw his own conclusions.
“In early 2000 I co-authored with Marcia Vickers an article on Wall Street’s “hype machine.” That story did not attempt to ‘call the turn,’ but instead reported on how hucksterism was running rampant. The story did not attempt to ‘call the narket’ and was not harmed by that omission in any way.”
Read more here. Indeed, I am currently reading a book called “The markets and the media” written by German journalism professor Thomas Schuster and it makes a compelling case for avoiding such writing. Schuster argues that the media recommendations about the market have never been beneficial to individuals.
