Surprise - another foreclosure hardship story on the national evening news.
This time it was the March 27 "CBS Evening News." CBS correspondent Ben Tracy had no difficulty finding one family affected, it's just that they were paid well to be affected. He showcased a family in Oakland, Calif., that had to move due to a foreclosure.
"What they did not know is that the owner of the home they've been renting near Oakland, California, wasn't paying her mortgage, and the bank foreclosed on the property at the worst possible time," CBS correspondent Ben Tracy said.
When is a billion-dollar loss a bonanza? When the person suffering it is one of those greedy Wall Street types the MSM loves to hate. Check out how, in opening this morning's show, Today cast the situation of Bear Stearns Chairman James Cayne:
MATT LAUER: Payday! His company imploded and thousands of stockholders went bust, but the Chairman of Bear Stearns cashes in and gets $61 million dollars. Will there be a backlash?
Watching the intro, I assumed the Chairman, despite Bears' fall, had received some kind of bonus or golden handshake. It wasn't until Maria Bartiromo came on later that we learned that Bear Chairman James Cayne, far from receiving a bonus or bonanza, had incurred one of the worst personal financial losses in the history of the street.
There are credit cards out there for subprime borrowers, too - it's not just mortgages. That means a new class of supposed victims for reporters like ABC's Chris Cuomo to defend.
Cuomo's segment on the March 27 "Good Morning America" hammered away at the credit card industry, claiming consumers were "getting sucked in by attractive offers" and being "trapped" by "fee-laden cards." He said to him, the whole thing seemed "wrong" and that companies were "squeeeezing" (he drew out the word) cardholders.
"But with these fees - account management, and all these clever names you have for them - that's not about borrowing," Cuomo accused. "That's about squeezing it out of them before the game even begins. Isn't that unfair? Isn't that past the line?" Cuomo pressed Chris Stinebert, president and CEO of the American Financial Services Association.
The story centered on 19-year-old Celina Alvarez, who got a credit card to pay her college tuition but then discovered her purchase wasn't the only charge.
"I didn't understand it to begin with," Alvarez said. "But then when I saw all those little small charges, I was like, that's ridiculous." According to the ABC story, the card included an "$100 origination fee" and a $10.95 charge that Cuomo called a "monthly maintenance fee."
Some Windy City restaurateurs are kicking bottled water to the curb all in the name, they say, of saving the planet, much to the delight of the Chicago Sun-Times. But it seems to me reporter Rummana Hussain may have washed over a juicier angle by burying a key fact eight paragraphs into her nine-paragraph March 27 article.:
Revenues from Chicago's new nickel-a-container bottled water tax are coming in at a rate nearly 40 percent below projections.
Could it be that the new water bottle tax adds yet another paperwork and accounting hassle for restaurant owners, some of whom would just as soon ditch bottled water than deal with the headache of complying with the law? Hussain didn't consider that angle, accepting on face value that restaurants are ditching bottled water purely out of concern for the environment.
If there was ever an obvious conflict of interest in economic reporting, this may very well qualify.
NBC chief foreign affairs correspondent Andrea Mitchell evaluated the housing crisis solution proposals of both Democratic presidential hopefuls Sens. Barack Obama (Ill.) and Hillary Clinton (N.Y.) on the March 25 "NBC Nightly News."
"Clinton was the first of the two to sound alarms about the subprime mess with a plan a year ago," Mitchell said. "Obama followed a week later with a call for a summit. Since then both have gotten more specific."
(The Times's international edition headline over Uchitelle's story had the slant of an opinion piece: "McCain sticks to supply-side economics despite evidence it doesn't work.")
Uchitelle's NYT piece began snidely:
When Ronald Reagan ran for president in 1980, he promised to cut taxes in what seemed, at the time, a magical way. Tax revenue would go up, not down, he said, as the economy boomed in response to lower rates.
As a recovering journalist, it has always amazed me how little journalists, even those specializing in financial reporting, know about the basic principles of economics. Similarly, it has always fascinated me how otherwise reasonable reporters can be reduced to self-righteous anti-capitalist ideologues, spouting the kind of anti-market drivel that one might have heard at a Communist Party meeting in the 1930s.
Nowadays journalists routinely attack lenders who take a chance on the poor. Take the case of “‘Pay day’ loans exacerbate housing crisis,” an article by Nick Carey of Reuters. In it, Carey lectures his readers, identifying with certainty what is making the “housing crisis” worse. The culprit he identifies is the payday lending industry, a subset of the subprime sector so regularly vilified by liberals, including Senators Barack Obama and Hillary Clinton.
Yesterday's Existing Home Sales report for February issued by the National Association of Realtors had better than expected news: On an annualized basis, sales were up. They were expected to go down. Someone interested in getting to the bottom of things would have found that the improvement reported by the NAR may be an early indicator a broader recovery in existing-home unit sales and sales prices.
That appears to be the last thing the Associated Press's Martin Crutsinger was interested in yesterday. In his report, he instead seemed determined to do all he could to portray the increase as a one-month respite in a long-term gloomy scenario. Additionally, he, in my opinion, presented changes in annualized sales volume as if they were one-month changes in actual sales, causing readers to possible believe that the housing market remains more in the doldrums than it really is.
"Meet the Press" host Tim Russert asked Bartiromo and CNBC's Erin Burnett if Bernanke was "up to the task" to take on problems with the U.S. economy. Bartiromo didn't blame the Fed chief for the current economic environment, but defended Bernanke and said the foundation of the housing problems was in place prior to his tenure.
"I really don't think you can blame Ben Bernanke for this, Tim," Bartiromo said. "You know, I think that he is, as Erin said, throwing the kitchen sink, doing a lot at this point. And remember, he's a new chairman. You know, so what was put in place before he was actually in this role has set us up for this."
"The American public don't know jack," Cramer said in response to a question from CNBC correspondent Michelle Caruso Cabrera about justifying the move to the American public. "They're just glad they're just not going to lose their job. I mean, this thing was so out of control. Everybody on Wall Street thought they were going to lose their jobs 10 days ago. We're thrilled."
As media continue to report current economic conditions as being almost Depression-like, they conveniently forget which political party has controlled both chambers of Congress since January 2007 as well as who was in the White House when key financial services deregulation was enacted.
Such a well-timed amnesia hit ABC's Claire Shipman Sunday when during the panel discussion segment of "This Week," she blamed the current financial crisis on Republicans.
Color me unsurprised.
After host George Stephanopoulos asked Shipman's husband, Time magazine's Jay Carney, "How does John McCain fix his problem on the economy," the following ensued:
With Eliot Spitzer gone, Chuck Schumer moves to the head of the list of smugly self-righteous New York pols. So it was particularly satisfying to see Sen. Jon Kyl [R-AZ] put Schumer is his place on This Week with George Stephanopoulos today.
A guest with Kyl for purposes of discussing the economy, Schumer clearly came in with a game plan: to analogize President Bush to the man who presided over the beginning of the Great Depression: Herbert Hoover. After Schumer tried it twice, Kyl had had enough and unleashed a riposte as devastating as it was reasoned.
A recent AP story about 50-year-olds moving back into their parents homes because the economy is so bad is one of the best examples of taking anecdotal evidence and stretching it into a universal truth that I have seen for a while. Filled with the sadly common "many say" and all based on the tale of one person who moved back home at 52, the AP magically discerned a national trend. This is the sort of shoddy reporting that is geared for one thing and one thing only: to promulgate a political agenda.
Taking shelter with parents isn't uncommon for young people in their 20s, especially when the job market is poor. But now the slumping economy and the credit crunch are forcing some children to do so later in life -- even in middle age.
A fairly common media meme during the past year or so has been that the continually declining value of the dollar is driving up oil and gas prices (image courtesy Slate).
In the past three months alone, there have been over 100 stories involving this very subject, including this March 10 piece from U.S. News & World Report entitled "Why Gas Prices Rise as the Dollar Falls (emphasis added):
Here's one of those complex economic truisms the financial press assumes everybody understands: A big reason oil and gas prices are hitting record highs is that the dollar is hitting record lows.
The beauty of this "truism" is that it allows media outlets to blame oil and gas price rises on the Bush administration, as everybody knows that the lower dollar is all their fault (wink, wink...nudge, nudge).
Of course, an examination of oil and Dollar Index charts does show an inverse correlation, meaning that as oil prices rise, the dollar drops and vice versa (charts provided by TradingCharts.com):
There's a new entry next to Mika Brzezinski's name in the annals of MSM elitism. The Morning Joe panelist today lamented blue-collar whites who "can't hear" the message Barack Obama propounded. Poor benighted souls. Joe Scarborough called Mika on it.
Brzezinski's comment came in response to Scarborough's exposition of why he didn't think Obama's speech would work with many blue-collar whites.
Fort Trumbull Developer Asks FHA To Back $11.5M Loan
Faced with a tight lending climate, the Corcoran Jennison company has asked the Federal Housing Authority to back an $11.5 million loan to fund the long-delayed construction of housing on the Fort Trumbull peninsula.
With the housing market sinking and causing panic about the American economy, Moody's Economy.com Chief Economist Mark Zandi thinks the time is right for the government to invest in the housing market.
"They're very difficult to tackle these - but I think they are coming forward with plans that eventually will have some benefit," Zandi said on CBS's March 14 "The Early Show." "But they do need to do more. I do think this is a very large problem, and it's going to require a big answer - probably taxpayer money at the end of the day and I think we're headed down that path."
NewsBusters readers are well aware of our contention that the press have adopted the 1992 strategy of making every economic report look like the world is coming to an end, and we'll all be in soup lines next year if the Democrat presidential candidate isn't inaugurated in January.
No finer example is available than Thursday's Associated Press article concerning February's very disappointing retail sales report. To be sure, store traffic was much worse than expected last month, and we are not trying to paint a rosy picture.
However, there are two truly disturbing elements in Martin Crutsinger's piece entitled "Retail Sales Plunge by 0.6 Percent" (h/t NBer Par for the Course):
In a report from the presidential campaign trail in Wyoming early Saturday morning, Sara Kugler of the Associated Press picked up on an economic meme created out of whole cloth by one of her colleagues, and treated it as an undisputed fact -- all in the name of creating support for campaign rhetoric coming from one of the two remaining Democratic presidential candidates.
The Labor Department's report, released Friday, also showed that the nation's unemployment rate dipped to 4.8 percent as hundreds of thousands of people — perhaps discouraged by their prospects — left the civilian labor force. The jobless rate was 4.9 percent in January.
On Wednesday's The Situation Room, CNN's Jack Cafferty suggested that blame for high oil prices rests not only with Bush administration policies, but also with its "relationship with the oil companies." During a discussion of John McCain and President Bush's recent meeting, Cafferty, who once pushed the liberal conspiracy theory that Big Oil deliberately lowered gas prices before the 2006 elections to help Republicans get elected, once again demonstrated his lack of understanding of the world oil market as he suggested that a "relationship" with oil companies could impact world oil prices: "Oil was $28 a barrel when George Bush was sworn in. It's $104 right now and could go to $120 soon. Now, why do you suppose that is? It wouldn't have to do with the policies of the Bush administration or the relationship they have with the oil companies, would it? Come on." (Transcript follows)
ABC's "World News Tonight" had a hard time on Friday without normal anchor Charles Gibson, as in its segment about the employment numbers released by the Labor Department, guest host George Stephanopoulos said the figures were from January 2008.
This was stated as a graphic came on the screen reading "JOBS LOST, January 2008, 63,000." Of course, Labor's report was for the month of February.
Sadly, that wasn't the only mistake "World News" made concerning this crucial piece of economic data, for just as the Associated Press had done earlier in the day, ABC's Business Correspondent Betsy Stark claimed (video available here, h/t NBer Gary Hall):
There's no denying the economy is slowing, and may have either entered a recession, or is on the brink of one. Maybe.
However, the media's hysterical response to Friday's February jobs report lacked any historical reference to how the labor market behaved in previous recessions.
Instead, press outlet after press outlet decided that the loss of 63,000 jobs in February was a clear signal the recession they've been calling for since Hurricane Katrina hit New Orleans in September 2005 had finally begun.
In fact, as they fretted over this decline in non-farm payrolls, media chose not to ask and answer an important question:
Yours truly had a memorable series of exchanges with MarketWatch Washington Bureau Chief Rex Nutting roughly 18 months ago. At one point, he appeared to reveal an expectation (otherwise, why provide a graph of it?) that home prices might actually fall like the NASDAQ did from 2000-2002 -- which, for the record, was almost 78%, from a peak of 5048 in March 2000 to a trough of 1114 in October 2002). He also described the housing market, which was still advancing nicely, as "in a free-fall."
Given the history, we shouldn't be surprised that Nutting pounced on the Fed's latest household net worth report, producing the following (link requires free registration):
.... for what I believe is a painfully obvious reason.
It is reports like the one written up by Shobhana Chandra at Bloomberg yesterday on household net worth that make you wonder if everyday US citizens will ever get the information needed to accurately evaluate what's going on in the economy without doing more digging than they have time for -- or that they should even have to do.
Chandra's writeup seemed to deliberately omit any and all context readers could have used to understand the significance of the information presented. She (based on this source, I'm assuming that Chandra is female -- if I'm wrong, please let me know) also sought out an "expert" to support a specious case that the reported results were masking a greater deterioration.
For years, NewsBusters and the Business & Media Institute have regularly complained about the abysmal financial coverage offered by the mainstream press while accusing media of consistently painting a negative -- and oftentimes fallacious! -- picture of the economy.
On Friday, a perfect example of such was illustrated by the Associated Press whose article about the February unemployment data just released by the Labor Department grossly misrepresented what was announced.
In fact, the AP's Jeannine Aversa actually fabricated data that went completely contrary to what was reported. Take a close look at paragraph two of Aversa's article published at Yahoo at 9:39AM (emphasis added):
Here's is the core information the Associated Press's Jeannine Aversa had to work with today in the Employment Situation Report released by the government's Bureau of Labor Statistics (BLS):
The "Dec.-Feb. change" column was added by me, but is easily calculated from the data in the BLS report. What Aversa did with this info, and my comments, are after the jump. (see also Noel Sheppard's post here)
Here's how her report began (scare words in bold; the headline is also from AP):