The biz media have no clue about what moves markets

Peter Cohan writes on DailyFinance.com about how the financial media seem to have no idea what moves markets.

Cohan writes, “The basic problem is that what business journalists write about stocks doesn’t explain what makes markets move. This failure reveals three dysfunctions of financial journalism:

1. Repeating analyst quotes as if they were explanations;

2. Confusing coincidence with causality;

3. Using the stock market as a forum to spout political opinions.

“Let’s examine the first dysfunction: Journalists need to write about the market’s movements because their editors ask them to. So journalists ask so-called market experts, who, in order to keep appearing to be experts, must say something other than ‘I have no idea.’ So they make up answers, which the journalists write in their articles — and that makes their editors happy.”