Is the Media Partially Responsible For the Panic?

Is it just me, or does it seem like the media is playing a large part in the widespread financial panic that has consumed the globe?

I know the media is in the business of selling “papers” but still, I wonder why they always seem to play up the negative. This only serves to feed the panic and thus make an already irrational market further disconnect from the fundamentals.

Is there any time when they should consider playing up some of the positive stuff, like companies that continue paying dividends, increasing liquidity, interbank credit easing etc. instead of feeding the panic?

Is A Balanced Representation Too Much To Ask?

I am not suggesting for a moment that they hide the truth. However, all we are really getting is an opinion and interpretation of what is happening - but does anyone really know what is happening?

The average person on the street panics and, because of the sensationalism of the situation portrayed by the media, cannot differentiate between opinion and facts. The average Joe may panic and liquidate his 401k and not even really know why he is selling, other than the fact that the media is bombarding him with messages of companies going bankrupt and people losing their life savings etc.

Worse yet, a study found that increased suicides and homicides are linked to the financial “crisis”.

An out-of-work money manager in California loses a fortune and wipes out his family in a murder-suicide. A 90-year-old Ohio widow shoots herself in the chest as authorities arrive to evict her from the modest house she called home for 38 years.

In Massachusetts, a housewife who had hidden her family’s mounting financial crisis from her husband sends a note to the mortgage company warning: “By the time you foreclose on my house, I’ll be dead.”

Then Carlene Balderrama shot herself to death, leaving an insurance policy and a suicide note on a table.

I certainly don’t have all of the answers, if any at all, to these issues.  However, I am becoming very disheartened with the mainstream media as they continue down a path that leads to more destruction than good.  The above shows the outcome of people feeling hopeless about their situation, financial or otherwise. Media outlets fueling such hopelessness certainly doesn’t help.

Front page headlines do not necessarily need to be filled with hope, but I believe the media owes the public the opportunity to receive sound and relevant news about the state of the economy and their personal finances. 

What Would It Take?

What would it take for the major media outlets to band together for the greater good of our global society and present quality information that would help to instill the appropriate (read: more rational) level of confidence in our monetary system(s)?

I know that much of the turmoil in the financial markets is real. However, for media outlets to portray this as the “financial apocalypse” is absurd and, in my opinion, unethical.  Yes, there is cause for concern about the economy and the financial markets, but the infusion of undue fear on to the public is shameful. 

At a time when media sources could be encouraging us to learn more about our economy and educate ourselves on personal finance, credit, and investing, they choose instead to churn out headline after headline proclaiming the next depression and the longest deepest recession in history etc.

One must wonder if there will ever be something bigger at stake than selling papers.

Comments

[MarvinMBA:]

Reporting the truth is the job of the press:
REAL DOWNDRAFT IN STOCKMARKET
REAL LOSS IN REAL ESTATE MARKET
REAL LOSS IN JOB CREATION
REAL COLLAPSE OF THE FINANCIAL/BROKERAGE ENTITIES
What do you want to press to say??????????
The press is doing what they are suppose to do!!!!!!!!!

2008 Oct 26 02:25 PM

[User 101449:]

There are definitely a lot of problems in the economy; in fact, it appears to be a perfect storm. However, the press and CNBC sensationalize all of the negatives and constantly have guests who predict Doomsday. The market moves violently based on their opinions and all of the negative reporting. The worst thing anyone can do at a time like this is cash out of their 401K and realize the paper losses. Markets are cyclical and always come back over time (although it may take a while in this market). The best advice is Warren Buffet's: Buy when people are scared and sell when they are greedy.

2008 Oct 26 03:13 PM

[Tom Armistead:]

My favoite gripe is the "headline number." It seems that the news media cater to whoever will throw out the scariest number on the big story of the day. Remember $300 oil? What is the biggest possible number for bank losses?

I think the real reason people are scared is Paulson. Really wierd and scary things are happening and he's always there when that occurs. Wealth and Value disappear over the weekend. They will reappear, in the hands of the favored few.

Put someone who is calm, persausive and fair in charge and the whole situation will get better quickly.

2008 Oct 26 03:40 PM

[Tom Armistead:]

I could add the fact that nobody seems to be telling the truth, there is just too much dishonesty in the market.

And I forget ot include the fact the the causes of various sudden business failures are very hard to pin down - there seems to be some hidden, malevolent force that is mowing down financials one by one.

Try CDS.

2008 Oct 26 03:49 PM

[James Cullen:]

Well written, and someone needed to say it. Yes, there are plenty of problems - but the media panders to those who live in fear... i.e., most people. Tune them out, or turn them off.

2008 Oct 26 04:18 PM

[User 45118:]

After the election the news will get better. The Media's number one objective is to get Obama elected.

2008 Oct 26 05:23 PM

[raising4dau...:]

Maybe the media could get some on Wall Street to actually jump out of windows like they did during the Depression instead of asking for taxpayer bailouts.

2008 Oct 26 06:16 PM

[DLRegister:]

This whole panic situation is being amplified for the benefit of Obama by the media. The Dem's also are taking every advantage to get big goverment to gain control. Were losing our freedoms every day this congress is in power!

2008 Oct 26 06:51 PM

[Lars39:]

Agree with 45118, the MSM is so wrapped up in desperately wanting the Dems to win in Nov, that they don't even pretend to be impartial. Fear is a great way to get rid of the party in the whitehouse.

2008 Oct 26 07:08 PM

[dingojoe:]

I don't see any evidence that the average Joe is liquidating his/her 401K. I do see plenty of evidence that the Highly Leveraged Joe, be they hedge fund investor or CEO buying company stock on margin, are liquidating like mofos. Is the media driving that?

2008 Oct 26 07:51 PM

[Tom Bombadil:]

Yeah, why can't our papers be more like Pravda or Xinhua, and only report in the national interest? That would make things a lot better!

2008 Oct 26 08:06 PM

[Steven Hansen:]

the average american gets lost on what you are talking about after 5 words. this is why the political candidates seem so shallow when they talk. if they make things difficult - they lose voters.

if you owned a hamburger stand, and only served hamburgers with sauerkraut and lemons on them - you would not have much business. the media has to make things simple for the average person or they will not watch or buy their product. if my memory is correct it is aimed at a fifth grade level.

i personally think the average joe should be scared $hitless if he is investing. however, the majority of joes either own their house outright or rent, and really have little investments. so this is entertainment.

and for those who believe this is some media smoke and mirrors to get obama elected, we are more likely watching the bush boys try to keep the dam from breaking before the election.

having said all of this, the media sucks. today, we have returned to yellow journalism of the early 1900's. you simply cannot believe anything you read or hear - and must fact check if you are interested in understanding the truth.

even in seekingalpha, many posts and comments are from people with an agenda. so beware.

2008 Oct 26 08:35 PM

[Jim Schothorst:]

Mr. McKinna, you must be fairly young to come up with " ...media partially responsible for the panic?". Folks, don't be blaming the Media for this historical event. What has happened is a unprecedent massive amount of FRAUD, period. Regulations were totally discarded and this F#ck-up is what we ended up with. There should be a ton of schemers, shills, and flim-flam artists going to prison over what has happened, and every single one of their possessions should be seized. Every house, car, off-shore bank account, wives' furs, jewelry, kids college funds, and whatever else they have of value. That's what should happen. This is happening to "elect Obama"? Whatever you're smoking is putting you in a Dream-state world. I'm guessing those of you that think this silly notion are Bush lemmings. Keep walking over that cliff, as you are following the Worst-President-Ever.

2008 Oct 26 09:53 PM

[Sapphire:]

Getting away from the election debate, I agree that the media is guilty of sensationalizing it and has fueled the stock-selling fire. When I signed onto my computer Friday morning the first thing I saw all over it was "investors furiously dumping stocks" and that trading in some countries' computers had shut down occasionally because they could not handle all the sell orders. What we ended up was one more day of vacillating back and forth before ending up down a few hundred points.

On one hand, I appreciate being informed of what's going on. But I have to wonder how many thousands of people read what I did that morning, panicked, sold everything and made their paper losses real.

2008 Oct 26 10:20 PM

[ThePressAnd...:]

I agree that the lberal press aand Obama are painting the worse possible pictures to get Democrats elected. The are as Low as the greedy Wallstreeters trying to pump and dump stocks or hyping risky investment for their own gains. SHAME ON ALL OF YOU. dON'T BELIEVE FOR A SECOND THAT TH LEFTIST LIBERALSCARE FOR THE COMMON MAN ON MAIN STREET. Democrats just want to take over and really make things WORSE when they redistribute your wealth(or what's left of it). The middle class is getting screwed from both Wall Streeters and the Democrats.

2008 Oct 27 03:11 AM

[vbierschwale:]

Good article.

Thats why I write my little articles.
Trying to plant the seeds that the media chooses to ignore.

Problem is, I'm only one person and I need to find a way to get millions to look at my website which requires funding..

If only I owned one of the major papers..
I'd be stepping up to the plate and doing what I could to restore confidence.

Virgil
www.KeepAmericaAtWork....

2008 Oct 27 08:26 AM

[carey_jim:]

Yes but the media is also partly responsible for bubbles.

The sole support of the media is advertisers and therefore, the media can't even say anything bad about them.

So it is opposite to what you think: The media are cheerleaders for business.

Also, the media are virtually all owned by super rich people who neither want their economic system or their businesses to fail.

The only thing I can't understand is why that isn't obvious to almost everyone.

The rich are always conservative but they aren't stupid. They want to bring more equality and justice to the majority of Americans, primarily so the majority wont overthrow them, either in the next election or with a revolution.

But the majority only want the opportunity to become rich and they cry liberalism or socialism whenever the media, controlled by the rich, tries to help them.

The press is not a liberal media but is really conservative. The press does not want to bring down the capitalist system or help it fall, because those who own the press come from the same class as those who own the rest of the society.

Why would they want to see the downfall of the society they own?

2008 Oct 27 02:18 PM

[CaptKorn:]

I am reminded that at the end of the Clinton years I found myself often saying to myself, allot of bad news is being sugar coated. Ask your average non financial and they will not recall that we were in a virtual recession when Bush took over. They will call you crazy. If Obama wins mark my words there will be for lack of a better word a Clinton effect.

2008 Oct 27 10:28 PM

[Joebond008:]

The media has created a panic syndrome and it was a little bad before the election, but they really hammered how bad it is causing even more panic and making the situation much worse. Too much doom and gloom not enough positive notes. I totally agree with the person who started this blog


On Oct 26 02:25 PM MarvinMBA wrote:

> Reporting the truth is the job of the press:
> REAL DOWNDRAFT IN STOCKMARKET
> REAL LOSS IN REAL ESTATE MARKET
> REAL LOSS IN JOB CREATION
> REAL COLLAPSE OF THE FINANCIAL/BROKERAGE ENTITIES
> What do you want to press to say??????????
> The press is doing what they are suppose to do!!!!!!!!!

Feb 17 11:17 PM