Scanning through the recent financial news, we were happy to learn that at least one American car company had enjoyed a good day in the marketplace. An article posted Monday on the MarketWatch Web site summed up the cheery news: “Ford jumps on higher profits.”


According to MarketWatch, Ford’s recent sale of its Hertz rental car unit and the solid performance of its luxury brands resulted in higher profits and revenue in the company’s fourth quarter. The bottom line: over the course of the day, the price of Ford’s stock had jumped 5 percent!


Hooo-Yaaahh! We can almost hear the shouts of glee from the winning bettors on Wall Street. But does this article really provide any substantive news about Ford Motors? We suspect that most people recognize that a stock’s performance on a given day is utterly irrelevant to anyone other than a few day traders and hedge funds gambling on short-term swings. Even among most full-time “market-watchers,” the vast majority are long-term investors who are far more interested in the overall health of the company.


For these people, joyous emotions arising from the MarketWatch story must have been tempered somewhat by another piece of news — namely, that Ford announced yesterday that it will close fourteen factories and cut 30,000 jobs over the next six years.


But what’s a measly 30,000 jobs compared to a 5 percent increase in a company’s stock? To judge by this particular article — not much. The optimistic report failed to mention the fact that the massive layoffs like Ford’s are unvaryingly the result of past managerial ineptitude, and often result in a pervasive atmosphere of employee fear that can cloud a company’s future.


This article was like reading the headline, “Zeppelin Company Stock, Up” the day after the Hindenburg crashed.


To its credit, MarketWatch offered plenty of reporting on the layoffs elsewhere on its Web site. Still, an article devoted entirely to touting a stock price at a time when Ford seems to be hemorrhaging only serves to remind us just how much the financial press seems to cater to the short-term trading community, at the expense of comprehensive reporting.


But this is not always the case. The article “The Top 100 Companies to Work For,” which appears in the current issue of Fortune magazine, offers a refreshingly different methodology for sizing up a company’s value to both shareholders and society at large. Specifically, the article conducts in-depth surveys of employees to measure things such as happiness and productivity, reminding us that these somewhat mushy variables can have very real effects on a company’s financial well-being. Mercifully, the article did not cite a single short-term stock price.


“There’s one thing that we know from experience does not qualify as a noble purpose: trying to make the stock go up,” noted Fortune. “It’s the foundation of shareholder capitalism, but it doesn’t make people get out of bed in the morning.”


That’s something all financial reporters should consider before putting their publications to bed at night.

If you'd like to get email from CJR writers and editors, add your email address to our newsletter roll and we'll be in touch.

Felix Gillette writes about the media for The New York Observer.