Readers know errors are a fact of newspaper life, and business-press readers are no different.

Errors are to be regretted, of course. To the reporters and subjects involved, they’re no laughing matter. But, to the rest of us, let’s face it, they’re basically a nonevent, right? We expect them. We understand. I usually don’t read them, except for their Onion-esque qualities:

An article in Business Day on Friday about favorite gadgets of executives referred incorrectly to the video game Gran Turismo 5. It has not yet been released, and thus is not a best-selling game.

That would follow logically, yes. Anything else?

The article also referred imprecisely to the game Halo 3. It is the first game in the Halo series designed for the Xbox 360; the earlier games, though playable on the Xbox 360, were designed for the original Xbox.

Ah. Thanks.

The chip in the Xbox 360 also was misidentified. It has a Xenon chip, not a Cell processor.

Hey! Stop that!

And the article also misstated the price of the Sony PlayStation 3. The PlayStation 3 starts at $399, not $299.

Finally, the reporter who wrote the article has not been incinerated by the new death-ray feature of the PlayStation 3; there is no such feature. He was in fact digitized by Apple’s Transmogrifier VII and fed into Gran Turismo 5,where he was tragically struck and killed by a virtual garbage truck.

Okay, we all have bad days.

But there are corrections, and then there are corrections. Some errors and the news organization’s response can point to larger problems.

A month ago, The Wall Street Journal ran a page-one story that said Merrill Lynch & Co. had engaged in off-balance sheet deals with hedge funds designed to hide mortgage losses, or delay their recognition.

“Deals with Hedge Funds May Be Helping Merrill Delay Mortgage Losses,” read the headline.

The story said the deals—plural—are “likely” to be “examined” by the Securities and Exchange Commission.

A summary box said the investment bank has been “off-loading” some of its mortgage-related assets to hedge funds. The story raised a parallel to Enron Corp., one of the worst criminal white-collar fraud cases in U.S. history, and said:

At issue with any hedge-fund deals is whether there was an attempt by Merrill to sweep problems under the rug through private transactions kept out of view from investors.

This raises the temperature, as we’ll see below.

Last week, the paper ran a 120-word correction on page A-2 that said that, in fact, there were no deals, or any that it could document. Merrill proposed a—singular—deal that matched the original story’s description but never consummated it. The proposed deal was stopped after Merrill’s own finance department found it didn’t meet accounting rules, the correction says.

In attempting to meet its obligation to deliver reliable information of significance to its readers, the Journal, in my view, failed twice—first with the error, and then by publishing a correction that was inadequate to the scale of the mistake.

So, before we close the book on this one, it’s important that the Journal doesn’t fail a third time by drawing the wrong lessons from the episode.

A couple of thoughts on the story itself:

This was a high-risk, investigative story about a complex subject involving an important Wall Street player. As a general matter, these stories are to be encouraged. The story itself, if it had held up, was reasonably important and interesting. On a scale of one to ten, it was about a seven, and, so, worth taking some risk.

If Merrill had been hiding its mortgage risk through off-balance sheet deals, that would be important to its investors, but for the rest of us, too, since the deal would raise the question of how many of these deals Merrill had done, whether other banks had done the same, and whether the bottom of the mortgage crisis was deeper than even pessimists had thought.

Also, it should be said, the Journal story breaks the news that Merrill was in fact shopping such deals with hedge funds.

Why only a seven, then? To me, the likelihood that the practice (even if Merrill had completed the deal) was widespread seems low. More likely, the story is fighting the last war, the Enron scandal. Plus, in the end, this is an accounting story that, even if it were true, aimed at the margins of the crisis. We are learning that the predatory practices and boiler-room mortgage operations that could impoverish hundreds of thousands of middle- to lower-middle-income strivers—many of whom will lose homes they already owned before letting mortgage snakes in the door—is largely a creation of Wall Street. The subprime story is bad enough, all by itself.

Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014). Follow Dean on Twitter: @deanstarkman.