The problem with CNBC and its markets coverage

Michael Hiltzik of the Los Angeles Times writes about why business news network CNBC is not good for people to watch during wild fluctuations of the stock market.

Hiltzik writes, “One can’t exactly blame CNBC for hyping stock market moves. The channel has to fill 13 hours a day with live market advice. It can’t possibly hold an audience for long swaths of that time without injecting drama into the proceedings, no matter how artificially. Its impulse is to give even viewers with no stake in the outcome a rooting interest in the numbers snaking across the screen. They’ll share the thrill of victory as the indexes climb back toward the green, and the agony of defeat as the effort falls short. CNBC learned a lot from sports broadcasts, and why not? I may not care about the Pittsburgh Pirates, but I’m a sucker for late-inning rallies.

“But that’s just one of the issues with CNBC. The continuous stream of market analysis pumped out at viewers inevitably cancels itself out. Shortly after noon Monday (Eastern), CNBC presented an analyst with ’10 reasons why the S&P could continue its big sell-off.’ About two hours later, it was hyping another guest predicting a ‘17% rally by year-end.’ Anyone who studies and reports on the capital markets knows that you can find a credible prognosticator with seemingly sturdy credentials to predict anything. But what is the average TV viewer supposed to make of a presentation that adds up to zero?

“As we observed a couple of years ago, the true nature of CNBC is fundamentally misunderstood, often by its own personnel. CNBC isn’t really a news service for average investors, though that’s how it markets itself. It is and always has been a service for traders, who share few characteristics with investors.”

Read more here.