As recently as the 1950s, the very words “Wall Street” carried such negative and parochial associations that Kilgore, the Journal’s chief, more than once considered changing the paper’s name (World’s Work and Financial America were kicked around and, thankfully, discarded). But by the 1980s, middle-class Americans were moving into the stock market, driven by many factors: 1970s-era inflation, which outstripped savings-account interest rates; the abolition of fixed-rate commissions in 1975, which lowered the cost of trading; the bull market that began in 1982; the marketing prowess of Fidelity and its ilk. The percentage of Americans who held stocks jumped, from 13 percent in 1980 to 32 percent in 1989.
By 1994, Joseph Nocera could write A Piece of the Action: How the Middle Class Joined the Money Class, which declared that the America middle class had pushed aside elites to join in the stock market:
The financial markets were once the province of the wealthy, and they’re not anymore; they belong to all of us. We’ve finally gotten a piece of the action. If we have to pay attention now, if we have to spend a little time learning about which financial instruments make sense for us and which ones don’t, that seems to me an acceptable price to pay. Democracy always comes at some price. Even financial democracy.
The trend Nocera identified was only beginning. In 1994, Americans had indeed moved en masse into mutual funds, but kept nearly as much in bond and money funds as stock funds. But by the end of the 1990s, the public had $4 trillion in stock funds, compared to only $808 billion in bond funds and $1.6 trillion in money markets. At the turn of the twenty- first century, nearly half of all Americans owned shares in one form or another. Maggie Mahar, in Bull! A History of the Boom, 1982-1999 (published in 2003 and essentially a grim bookend to Nocera’s optimism), uses polling and other data to show that most middle- and lower-income Americans who owned stocks in 2001 only started buying them after 1996. Of households with financial assets of less than $25,000, an alarming 43 percent made their first stock purchase in 1999 or later—and almost certainly lost money.
While it is reasonable for the business press to have adapted to this changing investment landscape, its emphasis on the stock market was almost certainly overdone. According to a 2010 paper by Edward N. Wolff, a New York University economist, about half of American households indeed own stocks in some form, but only 18 percent owned shares directly as of 2007, and thus could conceivably benefit from CNBC-ized financial news. Only 22 percent of households owned stocks worth more than $25,000 in any form (including mutual funds or pension accounts), and stocks as a percentage of total household assets were only 16.8 percent. (Of course, stock market wealth was skewed toward the wealthiest 1 percent, which held nearly half of stocks and mutual-fund assets; the bottom 90 percent held 10.6 percent.) What’s more, global debt markets are roughly twice the size of the stock market, and, as Gillian Tett noted in her book, Fool’s Gold, they receive scant attention from the business press.
In any event, CNBC and its market-focused competitors rose to serve the growing ranks of amateur investors. Consciously modeled on ESPN’s SportsCenter, CNBC programming consisted of pre- and post-“game” reports, along with in-game interviews—the game, of course, was the trading day. Viewers got a sense of connectedness to the inner workings of the financial system. During trading hours, a ticker streamed price changes of shares and indices. CNBC has done some fine documentaries over the years, but they are hardly the main event.
These days, the ticker includes such esoterica as the spot price for West Texas Intermediate crude oil, a light crude refined mostly in the Midwest and Gulf states, as traded on the New York Mercantile Exchange, “WTI/NYMEX.” Here is news fragmentation carried to some postmodern extreme. But, really, it’s nothing more than messenger-boy journalism digitized: old wine in a new bottle.
As Howard Kurtz recounts in Fortune Tellers (2000), a major preoccupation of the network involved winning deal scoops and getting early word of Wall Street stock analysts’ buy-and-sell recommendations, a task at which Bartiromo proved particularly adept. The network played a big role in elevating a few analysts to star status—Goldman’s Abby Joseph Cohen, Merrill Lynch’s Henry Blodget, Prudential’s Ralph Acampora. “Abby says the market will go up; Ralph says the market will go down,” CNBC personality Ron Insana intoned in 1999, as quoted by Kurtz. “The tug-of-war of titans.”