COUNTERCOLUMN: All Your Bias Are Belong to Us

So asks Megan McArdle.

I'll tell you why. Because, by and large, our financial media sucks.

Here's my comment, crossposted from her blog.

Tanta. She was doing the heavy lifting for our intellectually bankrupt financial press when it counted. Too bad all of you guys were too busy playing stenographer for your sources to notice when it could have counted.

But financial journalism as a whole is pretty useless.

They flopped on the S&L scandal until it was too late.
They whored themselves out hawking Internet stocks and funds at the worst possible time. Check out The Fortune Tellers for details.

They elevate chronic money-losers like Jim Cramer and idiotic concepts like Mad Money. Ed Slott should have Cramer's show. But he won't.

They promote self-promoting mental midgets like Suze Orman, who couldn't plan her way to Starbucks for a cup of coffee, rather than real planners.

They sat approvingly on the sidelines while Dave Ramsey insisted growth stock mutual funds average a return of 12% per year while leading hapless investors out of their guaranteed contracts, whole life insurance, fixed annuities, bonds, and EIAs like the the Pied Piper leading children to oblivion, and fell all over themselves quoting how much good he's done, when taking his advice was devastating to families in 1999 and devastating in 2007-2008, and never once called him on it.

You pay lip service to 'buy and hold' investing, but every cover on the big-circ glossies screams '10 mutual funds to buy now'

Your covers feature flights to safety AFTER the market crashes, and feature aggressive investments AFTER large rises in the market.

The financial media is the reason real-life, real-world investors only realize less than a quarter of actual market gains (I'm citing DALBAR here.).

Elaine Garzarelli makes one lucky call in 1987, and you idiots are still calling her for market predictions, 22 years later. How did that work out last time, when Smart Money called her? In their December 2007 issue, She recommended Lehman Brothers, Bear Stearns, Merrill Lynch and predicted Dow 16,000.

I guarantee you she'll still be getting calls from drooling reporters 5 years from now, if she's still working, and hasn't been shot by a client.

Smart money regards the financial media as a contrary indicator. The media is always the second dumbest guy at the poker table. The only dumber guy at the poker table is the guy who reads them.

They're asleep at the switch, by and large, while our pension crisis continues to build. They're asleep at the switch even now, while unrealistic GMIB riders threaten to cut the legs out from under major, major insurance companies, while there isn't close to enough capital in reserve at state insurance funds to make up the shortfall.

The financial media doesn't deserve Pulitizers. It deserves a kick in the nuts by an outraged public.

Splash, out

Jason

Labels: bloggers, economy, finance, journalism, McCardle, Media, public relations, The media