Stock Market

A new poll released Wednesday gave extraordinary evidence as to how continued negative reports from a bearish media have impacted the public’s view of the economy.

As reported by Reuters (emphasis added):

Two-thirds of those surveyed, 66 percent, said the direction of economic policy was fair or poor.

Yet, these same folks are very optimistic about their own economic condition:

On today's "Your World with Neil Cavuto," the host devoted a portion of his mailbag segment to viewers from across the fruited plain telling Cavuto of their local media outlets had ignored or downplayed yesterday's stock market closing. Cavuto noted that in contrast, a large market correction in February was blared on the front pages of the nation's largest broadsheets.

Video (2:26): Real (1.77 MB) or Windows Media (1.50 MB), plus MP3 audio (838 kB).

You can find more coverage on the media's biases on the economy with these articles from NewsBusters sister organization, the MRC's Business & Media Institute:

A new stock market high is good news, right?

“In stock market terms alone, this is now the longest consecutive uninterrupted stock market rally,” said Lawrence Kudlow on MSNBC’s “Morning Joe” on July 13.

“It started in early 2003, so that’s four and a half years. And it’s incredible how much wealth is being created out there and it’s unfortunate, really – almost tragic – that the president just doesn’t get any credit for it at all because he’s got a lot to say on the economy.”

While Kudlow found the record worth cheering, the three major networks supplied "some worries" and "some dark clouds" to viewers on July 12. Each one offered its own spin of gloomy news following the record high closings of the Dow and S&P 500.

"There are still some dark clouds looming over this market," said correspondent Dan Harris on ABC’s "World News with Charles Gibson." "The housing market is in a slump, interest rates are rising and gas prices are ticking back up."

President Bush warned Congress that he would veto a bill that would increase taxes for investors, cost billions of dollars and threaten the U.S. economy.

Despite the high price tag, the June 27 announcement attracted no coverage from the major news media.

“The ramifications of this [bill] are dire for the U.S. economy, federal revenues, and ordinary investors,” wrote Phil Kerpen in National Review Online.

Billion-dollar returns just aren’t good enough for NBC. On June 26, the “Nightly News” attacked wealthy hedge fund managers for making high-risk investments and for trying to do business with the “vulnerable” upper-middle class.

Reporter Carl Quintanilla mentioned rich investors who want to become “hedge fund rich,” but then focused his segment negatively on such investment firms.

“[T]he people who run them buy mansions, art – paying themselves salaries of over a billion dollars in just the past year.”

But is there anything wrong with that? According to Quintanilla, they’re run by greedy people and too risky for “a new more vulnerable audience.”

“They are beginning to target the upper middle class – the reasonably wealthy professional rather than the millionaire or the super-rich,” said Columbia University Law Professor John Coffee.

Our friends at Investor's Business Daily are taking a seven-part look at the media's incompetence in reporting market:

Media bias has been detected in other studies, but this series raises an additional possibility – media incompetence in analyzing and explaining how the economy and financial markets work.

Installments will cover how the media report on subjects like tax cuts, deficits, trade and stocks, creating myths – and unwarranted fear -- as they go along.

While the relatively narrow Dow Jones Industrial Average has been achieving alltime highs for a couple of months, it took until last week for the broader S&P 500 index to beat its previous record of 1527. The index closed at 1536.24 last week.

Instead of writing up the big winners in the 77% of companies that have brought the index back from its 2000 low, USA Today writer Matt Krantz looked for dark clouds in on otherwise blue sky, taking an opportunity to focus on the index's losers who kept the index's recovery of value from happening sooner:

S&P's run leaves Wal-Mart, other big caps behind

For a quarter of the stock market, the celebration about the Standard & Poor's 500's charge back to record levels for the first time in more than seven years is an example of history being written by the victors.

Even though the benchmark S&P index last week finally took out its old high from March 2000, investors who own 23% of its stocks have completely missed out. A total of 115 stocks in the S&P 500-stock index are still below where they were in March 2000, according to data from Bridge Information and S&P. They aren't down just a little, either, but off 45% on average.

"At any given time, you're going to have companies that have one-off issues," says James Paulsen of Wells Capital Management.

Yeah guys, and that's why investing in a broad-based index of stocks in an index mutual fund is often a good idea for investors who don't have the time to evaluate and keep up with either individual stocks or actively-managed mutual funds. Zheesh.

Back on April 23, as NewsBuster Scott Whitlock noted at the time, ABC’s Diane Sawyer fretted about the supposedly sky-high stock market. “Is this the thrill before the meltdown?” she panicked. “What should you do this morning to protect your money?” ABC's on-screen graphic ridiculously wondered: "Is Unstoppable Market Good or Bad?"

Today, an Investor’s Business Daily editorial mocks Sawyer’s Chicken Little approach. “We’re still waiting for the ‘meltdown’ that ‘Good Morning America’ stock guru Diane Sawyer was warning us about a month (and 600 Dow points) ago, when she devoted a segment to what we should do ‘to protect our money.’”

In the unlikely event John Edwards is elected the next president of the United States, don't look for Dee Dee Myers twirling on the dance floor with him at the Inaugural Ball. Appearing on this morning's "Today," the former Clinton press secretary took some serious shots at the former senator from North Carolina.

At about 7:08 am EDT this morning, Meredith Vieira began a tour of the presidential horizon with Myers and conservative commentator and radio talk show host Laura Ingraham. Talk turned to Edwards, and Vieira framed the issue in a manner not particularly flattering to the ex-trial lawyer.

As already noted on NewsBusters, Diane Sawyer made an absurd comparison on Tuesday’s "Good Morning America" when she linked the current rising stock markets with the period of time before the historic 1929 market crash. The GMA host, talking to ABC analyst Mellody Hobson, fearfully wondered, "Did you know that the stock market has hit a milestone reminiscent of what happened before the big crash?"

Except, it’s not at all reminiscent of the "big crash." From 2000, through 2007, the Dow rose from 10, 577 to 13, 312. That’s an average annual increase of 3.7 percent. In the seven years prior to the 1929 crash, the market spiked from 100 to 381, growing over 40 percent yearly. The rate of increase is over 10 times more than the current levels. So, when Sawyer concluded that "1929 was the big crash and this is reminiscent of what happened before that," her comparison isn't just wrong, it's also nonsensical.

With gasoline prices going up, Diane Sawyer worries they will continue to rise. With stock prices going up, the same Sawyer worries they will experience a crash of historic proportions.

Sawyer's guest on Good Morning America today at 7:15 AM EDT was Mellody Hobson, a GMA financial contributor. Here's how Sawyer kicked things off.

GMA CO-HOST DIANE SAWYER: Will runaway gas prices keep soaring, and did you know that the stock market has hit a milestone reminiscent of what happened before the big Crash? Let's start with gasoline prices. On Monday the average price of gasoline hit $3.05 per gallon, just two cents less than the record. . . Is this going to keep happening, keep going up?

Did the Dow’s ‘Bull Run’ Milestone Get to Your Paper’s Front Page Today?

Front page? Heck, the overwhelming odds are that it didn't get mentioned anywhere.

It should have been.

At CNNMoney.com, writers Alexandra Twin and Steve Hargreaves appear to be the only ones who even recognized the significance of yesterday's positive market close (bolds are mine):

Dow: Longest bull run in 80 years
Major gauges hit new milestones, but just barely; investors mull jobs report, oil prices, talk of a Microsoft-Yahoo merger.
May 4 2007: 4:09 PM EDT

NEW YORK (CNNMoney.com) -- The Dow Jones industrial average squeaked out another record high Friday, making this the longest bull run in 80 years, as investors cheered tame inflation numbers, talk of big mergers and a jobs report that appeared just right.

..... The Dow has now risen in 23 of the last 26 sessions, marking its longest bull run since the summer of 1927, when the indicator ended higher in 24 of 27 sessions, according to Dow Jones.

Turning the tables on John Kerry, and building on the snark of Matt at Weapons of Mass Discussion -- That would make it the best stock market run since, well, Herbert Hoover.

On Friday’s "Good Morning America," co-host Robin Roberts complained about the "staggering" salaries of American CEOs. Citing a new Forbes magazine report claiming that these individuals received a 38 percent raise last year, Roberts engaged in typical class warfare. She incredulously stated, "It has us saying, come on, you must be kidding."

Reporter Dan Harris and guest William Baldwin, editor of Forbes, listed several examples of supposedly outrageous CEO salaries and proceeded to divine who deserved such money and who did not:

Dan Harris: "Even the editor of Forbes has some trouble stomaching some of the things his staff uncovered this year. Oddly enough, number one on the list is Steve Jobs, CEO of Apple, who makes just $1 a year in salary."

As the stock market has continued to regularly make new highs in 2007, how many times have you heard or read a media report carping about how the rich are getting richer?

Quite a bit, right?

If you feel bombarded with such inanities, consider that a completely unaudited LexisNexis search of major American media outlets identified 234 reports which included phrases like “rich get richer,” “income inequality,” “wealth disparity,” etc., since January 1.

Add it all up, and that’s almost two a day.

A fine example of this nauseating mantra was demonstrated by CBS’s Charles Osgood on “Sunday Morning” April 15:

On April 25, 2007 the Dow soared to another record close, this time above 13,000. As Newsbusters reported here, here and here, the networks did anything but cheer. In fact, network broadcast reporting of the Dow's recovery since 2003 has been marked by pessimism.

Katie Couric introduced the April 25, 2007 CBS "Evening News" report with this dismal statement:

"Even as investors are making money in the market, Anthony Mason reports there are concerns tonight about the rest of the U.S. economy."

Mason made good on Couric's tease, with a class warfare remark that "Wall Street and Main Street appear to be headed in different directions" because of housing and gas prices.

Question: When is a New York Times "Manufacturing Recession" not a recession?

Answer: When the Institute for Supply Management (ISM) keeps on issuing monthly reports, such as the one yesterday covering April, telling us that manufacturing is in expansion mode.

On February 28 (second item at link), Times Business writer David Leonhardt wrote the following:

For Manufacturing, a Recession Has Arrived

The nation’s manufacturing sector managed to slip into a recession with almost nobody seeming to notice. Well, until yesterday.

To this day, Leonhardt appears to be the only person to "notice" the recession in manufacturing -- because it doesn't exist.

The TimesSelect current tease for Leonhardt's article, which is now behind the Times' subscription firewall, is even worse, leading one to think that it tells us that the whole economy is in recession (bolds are mine):

MSNBC: Fair and Balanced

According to MSNBC's Keith Olbermann, former New York Mayor Rudy Giuliani committed "terrorism" when he suggested that the country would be "playing defense" if a Democrat was elected president in 2008. And this is the network that’s hosting a Republican presidential debate?

Americans Making Lots of Money: Good or Bad?

On Monday, an ABC graphic provided a shining example of media bias. Co-host Diane Sawer was discussing the recent surge by the stock market. During the segment, a graphic below her read, "Will Dow Hit 13,000 Today? Is Unstoppable Market Good or Bad?"

You Won’t Have Rosie O’Donnell To Kick Around Anymore

"Good Morning America" reacted to the departure of Rosie O’Donnell this week by claiming that the left-wing comedienne was a pioneer for women. (The morning program also ignored her 9/11 conspiracy theories.)

Producer of an MSM morning news show? Got a few minutes to fill at the end of your first half-hour? Why not resort to a tried-and-true winner: a bit of good old class warfare?

That was the "Today" formula this morning. Matt Lauer introduced the segment, enviously entitled "Share the Wealth?: The Rich Get Richer," fanning the flames of envy and resentment with this opener:

TODAY CO-HOST MATT LAUER: Do you feel like you're working harder and harder nowadays just to stay financially afloat while fat cats get richer and richer? It's not just a feeling, and you're not alone. The story now from from CNBC's Scott Cohn.

View video here

The Dow Jones Industrial Average soared past the 13,000 level on Wednesday, but the CBS and ABC evening newscasts reported the good news in the media's all-too-frequent “yes, but” framework. CBS Evening News anchor Katie Couric fretted that “even as investors are making money in the market, Anthony Mason reports there are concerns tonight about the rest of the U.S. economy.” Mason talked with a celebrating stock trader before turning downbeat: “But Wall Street and Main Street appear to be headed in different directions. While the stock market's been racing ahead, the economy has been slowing down. Housing is mired in a slump.” Liz Ann Sonders of Charles Schwab confirmed bad news for the overall economy, citing how “we have seen economic growth get cut in about half in the last year, so clearly the economy is not as strong as it was a year ago.” Mason ominously warned: “Rising gas prices, up 70 cents already this year, could slow the economy even more.”

ABC anchor Charles Gibson teased World News: “Tonight, the Dow moves into uncharted territory, zooming past 13,000 for the first time. But is the economy as hot as the market?” Gibson set up his lead story by contrasting how “the rise in recent months has been steep, despite less-than-inspiring news on the economy overall.” Betsy Stark featured pleased investors before cautioning how “there were fresh signs today of trouble in the housing market” and “oil prices shot up another dollar today, which will only add to consumers' woes at the pump.” Gibson stayed on the negative, proposing to Stark: “We've had four years of a straight bull market. Doesn't just the timing of this suggest that there might be a correction?” Stark agreed: “By historical standards, Charlie, we're actually overdue for a correction.”

On Monday’s "Good Morning America," an ABC graphic about soaring stock prices proved, yet again, that there’s no positive economic story the media can’t spin downward:

ABC Graphic: "Will Dow Hit 13,000 Today? Is Unstoppable Market Good or Bad?"

The graphic ran underneath co-host Diane Sawyer and GMA financial contributor Mellody Hobson’s discussion over whether or not the Dow, which has been breaking records recently, is headed for a downturn.

Sawyer certainly seemed to think so. She began the program with this pessimistic tease:

From a CNN e-mail I received shortly after the close of Friday's stock markets (this was the entire message):

Wall Street fights off mortgage-risk-induced woes to end the week higher, with small gains Friday.

Anyone reading this e-mail would have thought that this was a net ho-hum week on The Street. After all, the e-mail merely said that the week ended "higher."

"Higher"? More like "way, way higher" -- in fact, the best single-week point gain in four years:

Something rather extraordinary occurred last December which had extremely ominous implications for stock investors around the world, but got totally ignored by the media.

In fact, if not for a recent video posting at YouTube, and a March 20 article in the New York Post, these spectacular revelations would still be well under the radar.

On December 22, CNBC’s James Cramer did a web interview for TheStreet.com TV. In it, he told TSC’s executive editor Aaron Task about how he used to manipulate stocks and the market when he was a hedge fund manager, and explained how such people today can’t “do anything remotely truthful” if they want to make money (video available here).

As TSC reported in a recap at its website the same day (emphasis added throughout):

Last night, ABC "World News with Charles Gibson," and CBS "Evening News" both blamed increased foreclosures on lending companies and mentioned tightened regulation instead of discussing the issue of personal choice. NBC "Nightly News" was the only network to bring individual choice into the story on March 13.

"Mortgage companies were lending to people with questionable credit," said ABC's David Muir.

But it is not as if lending companies run around just handing out money to bad credit risks, people actually have to apply for home loans because they want to buy a home. Both ABC and CBS missed that.

Instead Muir's "World News" report pitied one couple "fighting to hold on."

MRC's Business & Media Institute director Dan Gainor appeared on "Your World with Neil Cavuto" earlier to talk about the way the media covered yesterday's stock market slide.

"CBS, which always ends up being the worst in all of our studies for covering the economy, took a 3 percent drop and turned it into a disastrous, uh -- made it look like it's, you know, the end of the world," Gainor told Fox News Channel viewers.

As for any good economic news, "they buried it in the middle of a report" and then compared it to the two biggest stock losses in history, Gainor continued.

Video (59 seconds): Real (1.6MB) or Windows (1.88 MB), plus MP3 (285KB)

I subscribe to e-mailed breaking news alerts from both Fox News and CNN. Out of curiosity today, I reviewed the news alerts about the market's performance from yesterday's precipitous drop and today's rally.

I found that yesterday Fox issued two alerts to CNN's one. Today, Fox sent an e-mail update about the market's 50-point gain for the day. No such e-mail was issued from CNN, however.

I took the liberty to lift the text from the updates. Here they are in chronological order from earliest to latest:

Fox News breaking news update | 2/27/2007, 15:07 EST

DOW INDUSTRIALS FALL MORE THAN 500 POINTS ON FEARS OF ECONOMIC SLOWDOWN IN U.S., CHINA AND EUROPE

CNN Breaking News | 2/27/2007, 16:05 EST

-- The Dow sees its biggest one-day drop in 3 years, ending about 400 points lower after plummeting more than 500 points earlier in the day. More soon.