ProPublica’s Jesse Eisinger, in his NYT DealBook column, writes about what the press and the authorities should be asking about JPMorgan’s $3 billion (and counting) loss:
The first lesson of the financial crisis is not that the capital markets were poorly regulated or that the banks were too leveraged or that the government needed better processes for taking over failing institutions.
The first lesson is that when they are in trouble, banks will mislead the world about their financials. And some will lie. Richard S. Fuld Jr. of Lehman Brothers, E. Stanley O’Neal of Merrill Lynch and Charles O. Prince of Citigroup all played down their banks’ exposures before their institutions took vast losses. Were they deliberately misleading? Because of the failures to investigate the financial crisis adequately, we still don’t know…
Perhaps JPMorgan was a model of probity, but so far these questions have been given only glancing treatment. The news coverage has largely focused on how the bank took the losses, what went wrong with its risk management and what it’s doing now. The commentary has mostly gone straight to discussing the implications for banking reform.
That’s already a victory for bankers — including Mr. Dimon. The first question on everyone’s mind should be whether any existing laws were broken.
— Josh Stearns has some good thoughts on what he calls hindsight journalism, the tendency to piece stories together after the fact, when it’s way too late:
Some of the blame for the rise in hindsight journalism can be laid at the feet of journalists who have gotten too cozy with the the powerful, or too embedded within the industries they are supposed to be covering. In these cases, the hard questions aren’t being asked ahead of time because doing so would risk a journalist’s access or imperil some sense of false objectivity.
In reality though, we should look at the overall culture of newsrooms, not at individual journalists. A key factor in the rise of hindsight journalism is structural, rooted in job cuts and budget cuts. Many news organizations don’t have the resources, or won’t dedicate the resources, to investing in long-term stories that need to be tracked or developed over time (think for example of the Guardian’s dogged coverage of the News of the World hacking scandal over the course of years). It is risky for a newsroom to invest in a story that might go no where. There are no page views in the hypothetical. The FCC Information Needs of Communities report touches on how this has “shifted power away from citizens to government and other powerful institutions, which can more often set the news agenda.” Instead of breaking news, our newsrooms are too often waiting for news to happen and then trying to explain it…
It is not enough for journalism to simply report and explain where we have been. We are at a moment in history when we need journalism that also forges ahead, scouts the possible paths forward. We need a journalism of exploration and investigation, a journalism not afraid to wander or to fail. For in those forays into the wild, the complex, the unknown, we may find something that we need to know now, not after the fact
— The New York Times writes about how the String Cheese Incident is taking on monopoly Ticketmaster’s fee gouging, but leaves out a critical piece of information: How much telling us how much Ticketmaster is actually charging.
Consumers seeking tickets to all sorts of events have become increasingly frustrated — and sometimes enraged — by ticket fees, which can add 30 or 40 percent to the cost of an order, as well as by the lack of other options for buying tickets. But while the brunt of that anger is usually directed at Ticketmaster, other players in the business, like theaters and promoters, collect, and depend on, their share of fees.