Investors want to make money, but biz journalists make copy

TheStreet.com’s Marek Fuchs explains that people who use business news to try to make money in the market might become frustrated because it’s not the job of a business journalist to help investors make money.

Fuchs wrote, “It was reported that sales of previously owned U.S. homes were down 0.8% in December, making 2006 the worst year in the past 17. What happened to all those declarations of possible recoveries, those happy tales we read about only a few weeks ago?

“Here’s a typical lead, this one from Reuters…

‘Sales of previously owned U.S. homes slipped 0.8 percent in December and took their biggest tumble in 17 years for all of 2006, leaving in doubt whether the worst of a housing slump has passed.’

“Now, you see, they are writing about ‘doubt’ that the housing slump has passed. But besides some journalist looking to run with a few random statistics during the lightest news period of the year, no one in their right minds was saying it had passed. OK, OK — maybe some local realtors looking to pawn off inventory on the gullible, but you get the point, right?

“You need profits, but they need copy. So they structure a story around a purported recovery. That’s more of a story than some old, bad number. Then, when contradictory numbers come out, you just write about doubt. But it’s doubt in something that few right-minded people believed in the first place.

“A journalist can ride an idea one way and then the other and emerge ahead. He gets two articles out of it. As an investor, though, you get two losses from the same stunt.”

Read more here.