“The current crisis in global banking, markets and economies has reminded us all of the importance of financial and business journalism. It has also raised a set of profound questions as to the quality of that form of reporting. Why didn’t we know this was coming? Did the journalists fail to put the financial system under proper scrutiny? Are they equipped to deal with the continuing complex story? Is this representative of a wider problem with the news media?”—From “What Is Financial Journalism For?” a study published in November by POLIS, a joint public policy research project of the London School of Economics and the London College of Communication.
Those are good questions. The financial press doesn’t get much study from academic types, but if it ever was going to, now would be the time.
Two years ago, Damian Tambini, a senior lecturer on media and communications at the LSE, launched a project to examine financial journalism’s role in the wake of new challenges: technological changes, increasing complexity of the subjects it covers, a British media/insider-trading scandal, eroding media finances, and the rising clout of financial public-relations operations.
Then the financial crisis hit, making a systematic study of the financial media, if anything, more urgent than ever. The result is a useful 33-page paper that looks at the financial media’s place in the financial system and calls, at least implicitly, for higher standards.
The title of the paper asks one of those big, “dumb” questions that I find so valuable:
What Is Financial Journalism For?
Those kinds of questions don’t get asked much on this side of the pond. That’s too bad. Even the subject of business media’s performance in advance of the current crisis seems to be something of a taboo. The scant attention the subject has received has been either the once-over-lightly treatment, a la Howard Kurtz (1), and or an “all-clear” for the business press from our cousins over at the American Journalism Review.
We take a different view here on the press’s pre-crash performance and have done so on many occasions, and believe, like Polis, that some reexamination of the business press’s role and priorities is in order.
We note also that 68 percent of top business journalists recently surveyed agree with us that the financial press, to use a sports metaphor, didn’t leave it all on the field in the run-up to the crisis.
We’ll have a lot more on the subject coming up this spring. Stay tuned.
I recommend the Tambini paper as a starting point for discussion, not (solely!) because I was one of the interviewees, but because among its merits it sees financial journalism as not separate from, but as part of, a system designed to oversee financial markets and corporate actors. The tone is dry, sober and serious—entirely unAudit-like, and all the better for that.
“It is time for a much more serious analysis of the effects of new market systems, of new media and the state of financial journalism,” writes Charlie Beckett, Polis’s director, who wrote the preface.
The paper is written for the British context, so at first glance a lot of it may sound a bit off-key to American ears. It argues for instance, for reexamining financial journalists’ “rights” and “duties,” for strict definitions of who’s a journalist and who’s not, and for creating or refining codes to regulate journalist conduct. All this may sound very Euro—more formal, regulation-oriented, and even more organized than we’re used to. It might sound indeed a bit fussy and, yes, academic to define journalists’ dos and don’ts regarding panics, bubbles, market rumors, and the like. And one would think it should go without saying that business journalists shouldn’t trade in the stocks they’re reporting about.
Back in the mid-90s I toured the Bloomberg operation, with Bloomberg himself as tour guide, as part of an IRE group. Big room, each station had, like, two flat-panel monitors back when nobody had those. There were a hundred reporters in there at least, and Bloomberg told us how they got all the info in real time as a service to subscribers. I looked at all that power and money and talent deployed there and asked, "So, how often do you guys go deep on something, really did under the 10-k and tell what the real deal is?" I knew before I'd finished asking that the question was a tad naive. The response was stunning: about 5, 6 seconds of silence, during which time they looked at me as if I had three heads. Bloomberg's press aid guy (or maybe he was an editor) stammered some boilerplate about "sometimes" doing real j work, but the overall effect was one of impertinence and humiliation--mine--as if I'd asked the King to explain his obesity. This was one of many, many moments in my career in which I felt that way for that reason. I've come to think of that feeling and its manufacture as the chief product of journalism, as recently and presently practiced.
#1 Posted by edward ericson, CJR on Tue 13 Jan 2009 at 11:14 PM
This is apropos your good piece, Dean:
http://tpmcafe.talkingpointsmemo.com/2009/01/14/nattering_nitwits/index.php
Nattering Nitwits
By Todd Gitlin - January 14, 2009, 10:10AM
Harold Meyerson has a nice column in today's WP underscoring the deeply bizarro nature of an economy that, you've noticed, collapsed under the benign gaze of George "It's your money not the government's money" Bush.
By 2007, when Wall Street's profits amounted to an astonishing 40 percent of all American profits, the business of American finance was no longer American business -- providing loans for domestic production, technological innovation, that sort of thing -- but swapping bets and hedges on bets and hedges, all for hefty commissions.
Save for devising more ways for Americans to go into debt, Wall Street had basically decoupled itself from the economy in which Americans live and work.
And what were America's "financial news" channels doing all that while? I ran into a CNN Money manager at a journalists' do last night, and asked him whether he'd reconsidered any of the networks' reporting, in particular their choice of sources, in the light of recent bubble bursts. The short answer: No. Everything's jus' fine.
Back to Meyerson:
While the nattering nitwits of CNBC hailed the stock market increases of the first seven years of George W. Bush's presidency as evidence that the U.S. economy had never done better, every other economic index made clear that the economy was in dismal shape. As Neil Irwin and Dan Eggen documented in Monday's Post, the rate of job creation and GDP growth during Bush's tenure is the lowest of any president of the post-World War II period. Somehow, our financial geniuses managed to miss this and built a vast financial edifice on the backs of consumers who eventually could consume no more.
I hate to beat up on journalism at such a bleak time in its history, but it's salutary to remember the recent past before rushing out to repeat it.
#2 Posted by Todd Gitlin, CJR on Wed 14 Jan 2009 at 10:45 AM
Dean,
Thanks for your help on the report and for this superb analysis/review.
As Director of Polis, responsible for publishing Dr Tambini's report, I am delighted it is getting some US coverage.
I think you are being a bit hard on the quality of US reflection on financial media. In the UK it has also boiled down to people either blaming the BBC's Robert Peston for blogging or claiming that they alone have been warning about the Coming Crisis for years.
We're continuing with this stream of work - Dr Tambini has just returned from Hong Kong and we hope to get support to come to New York.
We will be debating it at a public event at the LSE on February 23rd.
If anyone is interested please have a look at our website at www.polismedia.org - we would welcome input from your side of the Pond!
regards
Charlie Beckett
Director, Polis at LSE
www.charliebeckett.org
#3 Posted by Charlie Beckett, CJR on Wed 14 Jan 2009 at 02:31 PM
Here's a snippet of what I, business columnist for OC Register, wrote on this debate recently ...
You know, we're not perfect. Not by a long shot. And I know we could've been bolder. And we could have put coverage of the brewing mess into plainer English, so perhaps you would have better understood the risks that were being taken.
But how can folks – from citizenry to academics to congressional offices – say they were blind-sided by the housing-fed economic disaster when for years various real estate types and their supporters have been complaining about a deep, negative slant to media coverage of the much-debated "housing bubble?"
The rest of my defense of my craft is at http://twurl.nl/hergkv
#4 Posted by Jon Lansner, CJR on Wed 14 Jan 2009 at 06:44 PM