Business Journalists Don’t Know Any Better Than You
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One of my favorite pastimes in college was tuning into CNBC (or CNNFN, remember that?) on random days to see what the reasons were that they were giving for the markets move that day. It was usually some intelligent sounding garbage about this or that, but they always had a reason. Of course, they had to have a reason or you wouldn’t watch the channel in the first place.
I knew that it was garbage and that most of the time they were making stuff up. I had to laugh when I opened Yahoo! Finance this morning. The lead story had the headline of “Stocks Dip on New Home Sales Data”. I swore that the headline had been reversed ten minutes earlier when the market was up. Clicking through to the actual story proved me right. The headline was flipped because the market was down, rather than up, but the wire services were telling us both happened for the same reason.
It’s not possible that the same piece of data pushed the market up, then down. Remember that when you flip through the financial press. Even though they are experts, unless there is actually a fairly large story that day take what they say for a grain of salt because they likely don’t have any better clue than you do why the market goes up or down on any particular day.
Which is one of the reasons that I love the commentators on APM’s Marketplace program. Often, they will tell you that they have no clue why the market jumped up 2% one day to go down 1.5% the next without any real news on the economy. That’s real journalism, not just making stuff up to justify your existence.