Media; fear mongering?

[LostMyShirt]

I always felt that, when it comes to media coverage of the financial markets and economy, there is always a speculation on the current status, and a speculative prediction or deduction.

The speculation on the current status, coupled with the prediction, in my opinion can leads to self fulfilling prophecy.

The media view on the current situation is never on a high note. As the RSS ticker flows across my desktop; all I see it sorrow. It seems the key words in nearly all articles are either, "Default", "Crisis" or "Bailout".

Does anyone else feel that media future market speculation in many cases lead to self fulfilling prophecy in the short term?

 

[skc]

I always felt that, when it comes to media coverage of the financial markets and economy, there is always a speculation on the current status, and a speculative prediction or deduction.

The speculation on the current status, coupled with the prediction, in my opinion can leads to self fulfilling prophecy.

The media view on the current situation is never on a high note. As the RSS ticker flows across my desktop; all I see it sorrow. It seems the key words in nearly all articles are either, "Default", "Crisis" or "Bailout".

Does anyone else feel that media future market speculation in many cases lead to self fulfilling prophecy in the short term?

No. The people and money that move the market do not make their decision based on sentiment reflected in the popular media.

 

[basilio]

Self fulfilling prophecies certainly makes sense. If the general feeling amongst investors and the public is concern about the market then fewer will buy, more will be inclined to sell and the SP will inevitably fall.

With regard to the economy a general fear of economic malaise will cause people to pull their spending in which will cause an economic contraction.

Trouble is there is also some fundamental realities at play at the moment with regard to out of control debts. As far as I can see no one has proposed a realistic way to tackle the issues so we should be concerned about the outcome.

Bit like falling out of an aeroplane without a parachute.. Not much pain at the moment but you know it's not going to have a happy ending

 

[Wysiwyg]

You probably notice the information comes in waves of pessimism or optimism. The information is known but the market behemoths take awhile to build momentum. The thread below was started on 4th April 2007 and the market peaked in October 2007.

Mr Murray said investors could ill afford to ignore warnings from the likes of Alan Greenspan. The former chairman of the Federal Reserve warned earlier this year that the US faced the risk of recession.

Hard to believe in euphoria, hard to believe in despair.

https://www.aussiestockforums.com/forums/showthread.php?t=6395&page=496

 

[sptrawler]

Self fulfilling prophecies certainly makes sense. If the general feeling amongst investors and the public is concern about the market then fewer will buy, more will be inclined to sell and the SP will inevitably fall.

With regard to the economy a general fear of economic malaise will cause people to pull their spending in which will cause an economic contraction.

Trouble is there is also some fundamental realities at play at the moment with regard to out of control debts. As far as I can see no one has proposed a realistic way to tackle the issues so we should be concerned about the outcome.

Bit like falling out of an aeroplane without a parachute.. Not much pain at the moment but you know it's not going to have a happy ending

I agre with you basilio, the money printing in the U.S, has not stimulated employment. It has stimulated more speculative borrowing which has further inflated share prices on the DOW.
Why wouldn't people borrow money at 1% interest and buy shares. The Dow has nearly doubled since the G.F.C, yet the U.S is still a basket case. So now when the P/E ratios come in it all looks stupid.
Like you said out of control debt. Sooner or later we have to let everything come back to market value.
That means a probable recession.

 

[IFocus]

I always felt that, when it comes to media coverage of the financial markets and economy, there is always a speculation on the current status, and a speculative prediction or deduction.

The speculation on the current status, coupled with the prediction, in my opinion can leads to self fulfilling prophecy.

The media view on the current situation is never on a high note. As the RSS ticker flows across my desktop; all I see it sorrow. It seems the key words in nearly all articles are either, "Default", "Crisis" or "Bailout".

Does anyone else feel that media future market speculation in many cases lead to self fulfilling prophecy in the short term?

Actually the mainstream media are being fairly brief on the detail.

If there was a little more serious analysis you would find that the news is far worse than being broadcast.

We are in a bear market and for good reason........ simple.

 

[LostMyShirt]

I am not blaming current market conditions on the theory of the original post. I put it into General Discussions mainly because it was not regarding current market situations and any examples given were purely for the sake of example.

I quite like the responses - thank you for the input, all.

 

[Gringotts Bank]

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

.... and on and on it goes.

It's quite amazing the media don't look at their headlines from yesterday and think "what the hell are we doing here? Oh that's right, we have no idea".

 

[LifeChoices]

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

.... and on and on it goes.

It's quite amazing the media don't look at their headlines from yesterday and think "what the hell are we doing here? Oh that's right, we have no idea".

The media will just make up a reason to explain the volatility, or read it somewhere else and repeat it. People look to the media to try to explain the unexplainable.

I think it's funny that it took a week for gold and silver to become safe-havens again.

 

[LostMyShirt]

I think it's funny that it took a week for gold and silver to become safe-havens again.

I hear ya buddy...

 

[Julia]

Actually the mainstream media are being fairly brief on the detail.

If there was a little more serious analysis you would find that the news is far worse than being broadcast.

We are in a bear market and for good reason........ simple.

I completely agree.

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

"DOW powers up 2% on possible Euro bail out plans"

"DOW plunges 3% on renewed fears over Europe"

.... and on and on it goes.

It's quite amazing the media don't look at their headlines from yesterday and think "what the hell are we doing here? Oh that's right, we have no idea".

Isn't that a bit unfair? What would you prefer the media does? Report nothing?
Just imagine the outcry if that happened! Most times, their account of the % up or down is pretty right imo.

The media will just make up a reason to explain the volatility, or read it somewhere else and repeat it. People look to the media to try to explain the unexplainable.

As above, isn't there usually a reason for the change that they're reporting?
That's not to say there is absolute logic in all market movements, but I've not seen too many examples of the media offering inappropriate explanations of market movements.

If you were going to carry the criticism through to its logical conclusion, we would have those top of the hour news bulletins which actually said "There is no news at this stage".

If they didn't report market events, the media switchboards would be assaulted with thousands of outraged listeners/readers.

 

[LostMyShirt]

If they didn't report market events, the media switchboards would be assaulted with thousands of outraged listeners/readers.

That is an unavoidable reality and truth of the matter - I agree.

Perhaps what is best is consistency in reporting instead of the over saturation and common exeggeration that is commonly displayed through-out all forms of media reporting - particularly current events.