Mainstream Media Bias

August 31, 2001

Editor's Note: Mr. Hickel challenges Mainstream Media Bias of "cheerleading stocks and bonds as the best investments period." Following are emails he sent to the perpetrators.

 

To: moneyline@cnn.com ; squawkbox@cnbc.com

Cc: friends@foxnews.com ; LePatron@LeMetropoleCafe.com

Sent: Wednesday, August 29, 2001 5:34 AM

Subject: a note on financial bias in TV Financial shows

The pattern is like this: TV Financial news show invites guest economist to speak on the economy. They naturally invite a large financial institution, brokerage house, or fund manager person to 1) discuss the outlook on the economy and 2) suggest any stock picks. Different now is the manner in which the commentators ask the person if they own any stock or they show the record of the person's last picks months earlier.

The prevailing issue I have with this approach to these financial gurus is that they all seem to have an interest in maintaining the bull market at its current level. The market, they claim, is due for a turnaround only a few quarters away. Just a few more quarters and we will see the big turnaround, we will. Yes we will.

Perhaps I didn't notice this solid forward looking prognosticating stock market before, but were it to really have that forward looking ability, would it be at the level it is at now had it prognosticated properly this quarter and the last few? I think not.

So, are the media money moguls feeding us all a line by choosing wisely (or poorly as the case may actually be) their guest economists who will not break party lines with this prevailing belief that just a few more quarters and we should start to see a turnaround in the markets and therefore this is a good juncture to "be positioned" or "weighted" in some of this and in some of that stock?

It would seem so.

The problem with this approach to TV money evangelism is that no one wants to admit something that may lengthen the dilemma, therefore the TV money people find themselves in quite the quandary. It seems that slowly but surely they are realizing that they can't always have guests who talk their book and support the market through unrealistic claims of turnarounds that don't seem to materialize.

Soon we will be witnessing phrases by these folks that follow this logic. "Market analysts predict that the economy will briskly turnaround first quarter 2003. Today the DOW and NASDAQ both rallied on this better than expected news. Today CISCO stock went up 2% in anticipation of 2003 future sales." Sadly, we are witnessing similar events by the day.

This cheerleading by the TV financial folks of the markets is a great disservice to many investors and may be the root cause of the many lawsuits that investors are beginning to file in earnest against some of these financial pundits. Frankly I am surprised that we have not heard more of suits against these TV shows for the choice of the people they have aired over the past several years. I guess they can claim First Amendment protection against having allowed their guest speakers to push stocks and market indices that have lost significant value. Perhaps this is right, but somehow I believe that the First Amendment won't protect them because cheerleading markets to unsuspecting investors has cost lots of people billions of dollars.

I detect in TV Financial Hosts a concern over some of the advice their guests have given over the past years and see stories of accountability and responsibility but none of it is directed at themselves -- only at others. It is time for these shows to stop the cheerleading and to stop hiding behind the veil of journalistic independence and unbiased reporting, because what they are doing and have done is simply cheerleading stocks and bonds as the best investments period. When people can't make money in the short term, they say, "Hold for the longer term." When money is to be in the short term, they say, "Might be good for a quick trade."

"Stocks have historically gone up. Some indices have performed better than the rate of inflation for 30 years."

Well, Mr. and Mrs. TV, it is time to be true journalists and economists. It is time to live up to your professions code of ethics (if you have one) and give the big picture. Stop pushing for the bull, allow the bear equal time. Expose the rampant fraud and manipulation. Dig deeper into this inflation index that somehow tells people that it doesn't cost anymore to live, but people in increasing number are going bankrupt because what they are being told and what it costs them to live aren't in synch. Check out this GATA story that talks of official US gold reserves being used to prop up the dollar and make inflation look low. Find out if there is any evidence of a plunge protection team -- a sanctioned-at-highest-level-private- and-public-sector-look-the-other-way committee who prevents the markets from realizing their true value by using the future indices to keep market drops lower than they would be and helps rallies move higher. Tell us why 2:00pm many afternoons the DOW and the NASDAQ rally from otherwise down days on a more than statistically likely basis. Tell us how being owned by large corporations doesn't affect your editorial bias as indicated by the guests you choose and the messages they send. Tell us more about who the buyers of gold are and not the sellers?

In all MR and MRS TV Financial person, you have got some fixing to do before people respond to this cheerleading and stock market bull bias by simply voting with their push-button or knob finger and electrically turn you off. Do your jobs and be real journalists without bias or shameful guest picking.

"Steve Hickel" smhickel@iserv.net

 

In 1934 President Franklin Delano Roosevelt devalued the dollar by raising the price of gold to $35 per ounce.