Financial media drank the Kool-Aid

Simon Dumenco of Advertising Age writes that the business press is as equally to blame for the Wall Street chaos as the executives who caused their companies to fail.

Dumenco writes, “Bubbles are, simply, media phenomena; irrational exuberance doesn’t exist in a silent vacuum. Financial manias are media manias; while they may start with Wall Street greed mongers, they need compliant media — in particular, financial journalists who are all too happy to drink Wall Street’s Kool-Aid — to really take off.

“Of course, just as we’re getting more self-pity than humility from Wall Street these days, we’re not exactly getting much in the way of mea culpas from the financial press. Nobody’s really been stepping up to the plate to say, ‘With our woefully incomplete and often shamefully gullible reporting on the murky financial underpinnings of the real-estate bubble, we let our readers and/or viewers down.’

“Not that the media aren’t capable of such introspection. We did see a remarkable degree of media self-flagellation in regard to the war in Iraq — with some media organizations admitting (years later) they were too gullible, too dependent on compromised sources and insufficiently skeptical of Bush administration claims about WMDs and Iraq and al-Qaida links.”

Read more here.