Nice article on MotherJones.com by former Wall Street Journal reporter Dean Starkman about the inward state of business journalism.
Increasingly, business coverage has addressed its audience as investors rather than citizens, a subtle but powerful shift in perspective that has led to some curious choices. The Journal, for example, at times seemed to strain to find someone other than Wall Street to blame for the mortgage mess: A December 2007 story announced that borrower fraud “goes a long way toward explaining why mortgage defaults and foreclosures are rocking financial institutions,” though no such evidence exists.
There is another trend too. Business coverage tends address its audience as consumers more than citizens. The market for business-news-for-citizens has dried up a while ago and consumer-oriented news coverage (product reviews, marketing news, personal finance advice, …) caters to a larger (read: less financially literate) and thus easier to reach audience.
Cash, Crises and Journalism was the title of a session at last week’s Journalism in Crisis conference at the University of Westminster. One of the participants was Matthew Fraser and he had this to say about financial journalism.
1 – Competitive pressures for scoops. In the modern media environment, journalists are just too busy to do off diary features like the potential state of the economy.
2 – Lack of professional training among business journalists, with most of them coming from Oxbridge but not having any financial experience.
3 – Business journalists simply have short memories, like everybody else, and failed to see the signs of the oncoming crisis.
4 – “Implicitly, everybody in the industry knows that business journalists don’t rock the boat of the audience with their careers”.
5 – Finally, many journalists were cheerleaders for the businesses, were having a great time in the club and simply had no interest in raising the alarm.
Parodies of journalism require talent, time and money. Just ask “Raoul Djukanovic” and “Philip Challinor”, two financial journalists who caught London commuters off guard last week by handing out a free, spoof edition of the Financial Times (FT). According to the Guardian, Raoul and Philip
put thousands of pounds of their own money into the publication. … It took the pair “about a month” to write about 150,000 words at the same time as working full time and they say the publication, called Not The Financial Times, was partly designed to show other journalists that they seldom write objectively.
Freedom from corporate culture doesn’t abolish groupthink, nor guarantee insight, entertainment or basic accuracy. So if churnalism’s the norm wherever you turn, is reframing a solution, or part of the problem?
Financial journalism (FiJo) – coverage of financial markets and corporate finance – remains a largely unexamined field of professional journalism, despite its prestige (cf. the cricital acclaim of The Financial Times or The Wall Street Journal), widespread concerns about its role and responsibility and a weak investigative track record. For example, no reporter uncovered the Enron collapse a few years ago. And also, how did we miss the 2008 credit crisis?
This question will be addressed during a POLISmedia panel discussion on Feb. 23 at LSE, entitled: “Why did nobody tell us? Reporting the Global Crash of ‘08”.
In the well-oiled PR behemoth that the National Basketball Association is, you don’t often learn about its financial struggles. This report however, breaks the news that the league is set to borrow $175 million to cover “operating losses” among 15 teams. This should come as no surprise; the league is low on star-quality (Kobe Bryant, Dwayne Wade, Dwight Howard, LeBron James), high on overpaid ‘franchise’ players (Stephon Marbury anyone?) and the cost of running an NBA franchise in the current economic climate is no small-piece meal:
The NBA was not looking to borrow at this time, Benjamin said, but JPMorgan and Bank of America came to the league several weeks ago to say there was an opportunity to do so. The league, after polling its teams and finding a need, agreed to the deal in part because of the lack of borrowing opportunities since the fall.
In a timely and lucid report, LSE’s Damian Tambini describes the role and responsibility of UK financial journalism (FiJo). Cast as a “a branch of the [journalistic] profession which faces unique ethical dilemmas” (p5), FiJo is seen as (p6):
based on a ‘social compact’ of rights and responsibilities. Rights and privileges have been afforded to journalists in return for commitments to responsible journalism.
Through interviews with journalists, financiers and regulators, the report provides empirical evidence for professional, technological and editorial challenges facing FiJo, including the critique that FiJo exacerbates “capital markets dysfunctionality” (p9), that it spreads market “doom and gloom” (p12), that it reports on an increasingly more complex domain (p19) and that it is being colonized by “sanitized” financial PR (p22). These observations lead the author to conclude that (p29):
UK Financial Journalism is at a crossroads. Over the years, it has established a range of professional practices, rules and codes that together amount to a public compact of privileges (rights of access and a range of other freedoms) which have been granted in the light of the particular function that financial journalism plays. But due to change in the practices of journalism, and challenges to the accepted notion of who is a member of the profession, this established compact is likely to be increasingly challenged. There is a choice: either the informal institutions that police and guarantee ethical behaviour (such as the PCC and the codes enforced by individual outlets) will be shored up and law and policy will clarify to whom privileges such as source protection should be granted; or those privileges will be watered down. Standards will be compared and compete with standards of other countries and other media, and the extent to which the ethics of professional financial journalism remain the most appropriate will continue to be debated.