The power of the Wall Street Journal's front page

TheDeal.com executive editor Yvette Kantrow weighed on on a Wall Street Journal story on Monday about a pending deal that Bear Stearns supposedly has in China. Kantrow notes that the story was being questioned later in the day by a Reuters report, but that many other media outlets accepted the story as the truth even though a deal has yet to be announced.

Kantrow writes, “Such is the power of the Journal’s front page. Put a story there, and no matter how thinly sourced or preliminary it is, or how many denials it collects, it almost automatically takes on the patina of fact or official announcement. Now at what point do ‘early talks’ — as the Journal’s headline refers to what’s going on between Bear Stearns and CCB — bloom into actual talks? Are ‘early discussions’ between a few top executives the same as negotiations? More importantly, are they really front-page news? Perhaps, as CNBC’s Charles Gasparino posited on SquawkBox Tuesday morning, the ‘talks’ here consist of a few Bear Stearns honchos making a ‘pitch’ to the folks at CCB. If that’s the case, wouldn’t the story be better suited for the Journal’s more speculative Heard on the Street column than for its august front page?

“Interestingly enough, Heard on the Street is exactly where the Journal, which hung on to this story like a Jack Russell terrier gnawing at Sam Breakstone’s leg, played its follow-up the next day, April 18. That piece noted CCB’s denial in its fourth paragraph, but quickly countered that ‘people familiar with the matter confirm there have been discussions involving top executives at Bear and a very small group of top people at the bank.’ In other words, ‘We called back our sources, and they assured us our story is right.’ Fine, though at this point a little more information on these anonymous sources might be helpful, as would an explanation of why they can’t be named.”

Read the rest of her critique here.