Tag Archives: Commentary

Financial journalists needs to improve their economic literacy

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Anya Schiffrin of Columbia University argues for improved understanding of the economy among financial journalists in a commentary piece for The Guardian in London.

Schiffrin writes, “A study I did at Columbia University last year with Ryan Fagan (‘Are We All Keynesians Now? Press Coverage of the US Stimulus Package’, forthcoming) looked at press coverage of the $787m American Recovery and Reinvestment Act of 2009. We analysed 718 articles about the stimulus in the months before and after it was passed. We looked at all the key mainstream US publications including the New York Times, Barron’s, Los Angeles Times, Associated Press, Time magazine and others. The coverage was not bad, but it was in no way innovative or forward-looking. Instead of discussing the likely effectiveness of the stimulus, for example, most of the articles before passage simply focused on whether or not it would pass.

“‘The concept of a Keynesian stimulus is not immediately intuitive. It would have been nice if there had been more in-depth explanations. As it was, there was more of ‘what happened yesterday’ than ‘what are the long term implications?’ but that’s not unusual,’ said one national economic reporter, describing the press coverage.

“Five months after the stimulus passed, the unemployment rate was still climbing. (It was 8.2% in February, 9.4% in July and 9.7% in August 2009, and today stands around 9.0%, depending on how it’s counted.) That led to a spate of articles about whether or not the stimulus would work or had worked. These articles mostly said it wouldn’t and mostly didn’t mention the fact that the majority of the money had still not been spent. Instead, a number of the articles argued that since the stimulus had failed, the US government should not consider a second one.”

Read more here.

NYT biz columnist Nocera to join op-ed page

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Joe Nocera, well-known business columnist for The New York Times, will become a columnist for the paper’s opinion pages. Beginning in April, Mr. Nocera’s column covering business and financial policy matters will appear twice weekly in print and online.

For the past six years, Nocera has written the Saturday Talking Business column covering the world of business, everything from Home Depot’s annual meeting to Boeing’s comeback to his offbeat musings about his broken iPod. His coverage has won several awards including three Gerald Loeb awards and three John Hancock awards for excellence in business journalism.

“Our readers have come to rely on Joe’s insights into the often opaque world of business and finance,” said Andrew Rosenthal, editorial page editor of The Times, in a statement. “His knack for exposing unsavory behavior by business and government alike will have a welcome home on the Opinion pages.”

Nocera is the author of “A Piece of the Action: How the Middle Class Joined the Money Class.”

Before joining The Times, Nocera spent 10 years at Fortune magazine, where he held a variety of positions, including contributing writer, editor-at-large and executive editor. His last position at Fortune was editorial director. He was the Profit Motive columnist at GQ until May 1995, and he wrote the same column for Esquire from 1988 until 1990.

In the 1980s, he served as a contributing editor at Newsweek, as executive editor of New England Monthly and as senior editor at Texas Monthly. From 1978 until 1980, he was an editor at The Washington Monthly.

Building Bloomberg View

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Michael Barbaro of the New York Times writes about the launching of Bloomberg View, the opinion service being launched by Bloomberg L.P.

Barbaro writes, “According to people involved in the process, the company contacted several high-profile journalists about leading the organization: Chrystia Freeland, a former managing editor of Financial Times, now at Thomson Reuters; Rik Kirkland, the former editor of Fortune magazine, who works at McKinsey & Company; and Alix M. Freedman, a deputy managing editor at The Journal and a Pulitzer Prize winner. All three declined to comment.

“In the end, Bloomberg L.P. hired David Shipley, the op-ed editor of The Times, and James P. Rubin, a former assistant secretary of state in the Clinton administration. Mr. Shipley will focus on topics in the United States and Canada; Mr. Rubin on the rest of the world. Both will earn in the area of half a million dollars. The venture has an estimated annual budget of $5 million.

“Those involved said the editorials would mirror the kind of data-driven, nonpartisan, centrist thinking that has defined Mr. Bloomberg’s career, even as it has become rare in public discourse. Other news organizations are undertaking similar expansions in opinion journalism. The Times is overhauling its Week in Review section and broadening its Op-Ed report. Thomson Reuters bought a company that provides commentary on finance.

“Not everyone inside Bloomberg L.P. is enthusiastic: its news arm is known for bleaching stories of extraneous adjectives, conjunctions and descriptions, adopting a just-the-facts ethos that has earned it a reputation for fairness.”

Read more here.

Taking a trip paid for by company that you're reporting about`

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Felix Salmon of Reuters doesn’t like that Business Insider’s Dan Frommer has taken a trip to Spain sponsored by Samsung so that he can report on Samsung’s products.

Salmon writes, “For one thing, Frommer’s not just scrounging up whatever’s necessary to get him to the conference and report. He’s was flown over ‘in posh business class,‘ which almost certainly means posh hotels and expensive jamón iberico as well. Samsung is doing its utmost to buy his goodwill: why is he letting them get away with it?

“On top of that, Samsung is loving the ubiquitous disclaimer — it provides fantastic free marketing for them in every post. Frommer might think he’s somehow neutralizing the junket by disclosing it; in fact he’s giving Samsung vast amounts of exactly what they want most.

“Most tellingly of all, Samsung isn’t really ‘sponsoring’ Frommer at all — especially not if, as seems logical and as Barret reports, other bloggers at the conference are getting the same deal and not disclosing it. Sponsorship involves a trade of some description: we give you money, you give us some kind of ad space or exposure. If Samsung is getting nothing explicit in return, then it must be getting something implicit instead.”

Read more here.

Failure to disclose freebies like this is very bad; disclosing them, however, isn’t much better. So the best solution is to simply refuse to take them.

Taking a trip paid for by company that you’re reporting about`

by

Felix Salmon of Reuters doesn’t like that Business Insider’s Dan Frommer has taken a trip to Spain sponsored by Samsung so that he can report on Samsung’s products.

Salmon writes, “For one thing, Frommer’s not just scrounging up whatever’s necessary to get him to the conference and report. He’s was flown over ‘in posh business class,‘ which almost certainly means posh hotels and expensive jamón iberico as well. Samsung is doing its utmost to buy his goodwill: why is he letting them get away with it?

“On top of that, Samsung is loving the ubiquitous disclaimer — it provides fantastic free marketing for them in every post. Frommer might think he’s somehow neutralizing the junket by disclosing it; in fact he’s giving Samsung vast amounts of exactly what they want most.

“Most tellingly of all, Samsung isn’t really ‘sponsoring’ Frommer at all — especially not if, as seems logical and as Barret reports, other bloggers at the conference are getting the same deal and not disclosing it. Sponsorship involves a trade of some description: we give you money, you give us some kind of ad space or exposure. If Samsung is getting nothing explicit in return, then it must be getting something implicit instead.”

Read more here.

Failure to disclose freebies like this is very bad; disclosing them, however, isn’t much better. So the best solution is to simply refuse to take them.

Translating corporate statements into journalism

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Robert MacMillan, an editor at Reuters, writes Tuesday about the process of translating corporate statements into useful English that can be used in business news stories while he visits the wire service’s Bangalore, India bureau.

MacMillan writes, “The easiest way to make that pain vanish is to accept what the companies say. We’re working people; we just want to do our piece for our subscribers, our readers and our bosses and get the hell out of work and go home and relax. After all, journalism might be a noble profession or a vile one, depending on whom you ask, but for most of us, we’re trying to get through the day and tell people some things that they want to know.

“All of us at Reuters and our competitors deal with this. Our Bangalore bureau deals with it more than most. These reporters and editors deal with the heavy volume of company statements. They’re the ones who publish the early versions of the stories that our beat reporters later update and prettify. You could say they’re just moving the copy, but their obligation, as much as anybody else’s, is to interpret what’s going on. They also have to do it within minutes, then update, then do it again, all while knowing that at some point, if the story is important enough, someone else is going to get the byline. A shared credit often is the best there is.

“The challenge we face in that bureau is how we move quickly while properly analyzing what the hell is going on when some company releases an incoherent statement. We need to find the drama and the narrative and say it correctly and say it quickly. Not easy. Every New York reporter who did this before we moved these operations to Bangalore knows it. When we do those things, people understand the importance of the news to their lives – or maybe sometimes just their portfolios – but sometimes their lives.”

Read more here.

The need to be more critical in business journalism

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Columbia University professor Anya Schiffrin, who recently edited the book “Bad News: How America’s Business Press Missed the Story of the Century,” writes for Reuters about how she recently reviewed early business journalism and how it compares to current business reporting.

Schiffrin writes, “Few today would accept the vagaries and obvious imprecision of those centuries-old dispatches. Yet reading recent press coverage of the parlous state of the U.S. economy, I often have the feeling that reporters and economists are just as confused today as they were in West Bengal in the 18th century. A recent New York Times story about new job numbers, showing that only 36,000 jobs were created  but that the unemployment rate fell from 9.4% to 9.0%, left me perplexed, especially when I turned to Bob Herbert’s column saying the numbers didn’t really make sense. Floyd Norris also offered a partial explanation of why the numbers often aren’t reliable.

“Media critics and academics give many reasons for why economic reporting often falls short. They note that economists are often uncertain as to where the economy is headed, and that reporters lack the knowledge to analyze the data they receive. Writing a short piece to a tight deadline means there often isn’t the time and space to delve into deeper economic questions. And then there is the question of ‘cognitive capture’ (a term coined by economist Willem Buiter) which Financial Times editor Gillian Tett has used to describe the fact that journalists often take on the worldview of the people they cover. In the case of business journalism this means the view that markets work well and that U.S.-style capitalism is the best in the world.

“Today’s business journalism is more sophisticated than it was 200 years ago. And the financial crisis has produced some superb reporting from people like Michael Hudson, Gretchen Morgenson, and the late Mark Pittman. But since my book has come out I’ve heard many stories of journalists being told by their editors to downplay their warnings of how badly the economy is doing.  If business journalists want to do an even better job, they would  serve their readers well if they could be a bit more critical and follow their instincts as to what seems wrong, distorted or missing — even if it means questioning the conventional wisdom.”

Read more here.

DISCLOSURE: I contributed a chapter to “Bad News.”

Lohan trumps oil tanker story

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Hal Morris, writing on his Grumpy Editor blog, notes that many media published more coverage of troubled actress Lindsay Lohan going to court than the capture by pirates of a U.S.-bound supertanker that provides one fifth of daily U.S. crude imports.

Morris writes, “The Lohan saga received more press play in New York than in Los Angeles.

“Full front-page photos of her, attired in a tight-fitting white dress, appeared yesterday in the New York Post, Daily News and AM New York while The Los Angeles Times gave her three-column, front-page art with a story on an inside page.

“Even The Wall Street Journal gave the actress far more space (an inside three-column photo, with caption only) than the captured supertanker which was wrapped up in one-and-a-half sentences distilled from an Associated Press story.”

Read more here.

The role of the press in the financial crisis

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Peter Goodman, the business editor of the Huffington Post, writes about the role of the business media in the recent financial crisis.

Goodman writes, “The trouble was that a louder chorus repeatedly drowned out this probing reporting about the magnitude of the real estate bubble–a steady celebration of permanently rising home price, the fantasy that propelled a construction binge, a mortgage bonanza and no end of wealth that got created along the way. That chorus abetted and enabled the capture of the regulators who are supposed to be able to tune out such noise while dispassionately scrutinizing the numbers.

“This is not to exonerate the press or chastise the lazy reader, the reflexive posture for many a scribe whose words have failed to produce happy results. Though the press rarely has the power to dominate events and does not make policy, we are collectively responsible for the understanding that our audience takes away from our words. And it is a fair hit to assert that we are prone to being manipulated and getting swept up in the excitement of the times, rather then stopping to ask the critical, typically difficult-to-answer questions that public service journalism demands.

“This is not so much because we consciously decide to become cheerleaders, urging on bubbles that take shape on our watch, but rather because cheerleading is the product of the easiest options that present themselves on any given day. Rising prices, soaring stock markets and the wealth accruing to executives overseeing the festivities are verifiable facts, whereas warnings and worrying entail the indulgence of conjecture and speculation, and they might turn out to be wrong.

“It takes a special breed of reporter to do the digging and put faith in their convictions as they take on the dominant narrative of the moment–particularly when that narrative is championed by prize-winning economists celebrated as wise men, such as the former Federal Reserve Chairman Alan Greenspan and his successor, Ben Bernanke, who played leading roles in convincing the public that everything was fine.”

Read more here.

The role of business journalism in society

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Craig Ey, the editor of the Philadelphia Business Journal, writes in Friday’s edition about the role and responsibility of business journalism in a free society like the United States.

Ey writes, “That begins to break down when the business press sees itself differently; when business journalists stop taking on the same kind of watchdog role as government and political journalists. In a way, that’s what happened over the last decade. The tough questions weren’t asked.

“When you read the Philadelphia Business Journal online or in print, you need to know that what you’re getting is accurate intelligence about community and business leaders, your competitors and your industry. Cheerleaders can’t do that. The old saying among ink-stained — and now monitor-weary — wretches is that our role is ‘to comfort the afflicted and afflict the comfortable.’

“While we may roll our eyes at such idealism, it’s really still true. Life and business may be unfair at times, but an active press can certainly help level the landscape.

“The logo of California-based Ameriquest included an image of the Liberty Bell, which has become the symbol of what it means to live in a free society. But with freedom comes a ton of responsibility, and all media, including the business media, plays a central role. Hopefully, the lesson has been learned.”

Read more here. A subscription is required.