Reader MJ, a financial adviser, emailed Market Blog to complain about the way the media handles bad news. MJ writes:
"I've noticed through this recession that the media has seemed to have taken it upon itself to make this market correction appear as bad as it possibly can. My clients are calling me up with fears that are utterly irrational, and the amount of doomsday predictions has more than doubled."
And: "In short, sir, you are making my job very difficult. In fact, there are many of those in my field that believe that this entire recession is much more a result of media-driven fear-mongering than any actual market correction."
This is a complaint that is levelled frequently at the media. We feel obliged to respond.
The news is bad. Yes, bad news does drive readers to blogs such as this one, but it is unfair to suggest that - given the backdrop of circumstances over the past 12 months - the media is exaggerating the news.
These are strange days: Bear Stearns, Lehman Brothers, Merrill Lynch and General Motors have disappeared as publicly traded stocks - a sequence of disasters that was unimaginable to all but a handful of truly bearish commentators a short while ago.
In many ways, the enormity of this financial and economic disaster has been difficult to gauge as it has rolled over various projections. Some analysts had "buy" recommendations on the above stocks until the bitter end. General Electric Co.'s chief executive stubbornly held the view that his company's dividend was safe - until he cut it.
The possibility of a global recession was dismissed by many economists until it became a reality. And strategists have unanimously over-estimated year-end targets for major indexes such as the S&P 500, never believing for a moment that it could fall 38 per cent in 2008.
This blog is intended to inform investors with news and analysis, not send them into shock. If long-term investors know why the market is doing something on a particular day, then they are knowledgeable - and knowledge is always a good thing, no?
As always, we welcome your comments. As for complaints about how the media handles good news, we'll save that for another day.
David Berman