At what point does the media itself cause harm to the economy?

[Nicholas D Wolfwood]

For proper reasons, everyone bashed Phil Gramm and John McCain last year when they said our economic problems were psychological. It was woefully tone deaf and frankly a piss poor overly simplistic statement.

That said, there is some truth to the notion that our economy is driven by consumer psychology. People right now are deathly afraid to enter the markets or make affordable purchases, with some good reason. In a particularly stark example, stocks like GE are 8.50 a share, even though it is a solidly performing company. So why aren't the people that have money pouring money into it? (And yes, even today there are many people around flush with cash.) Fear, mostly, perhaps along with a dash of "maybe I can get a better deal if I wait just a bit longer."

Therein lies my question - I've been watching the nightly national news broadcasts with greater frequency lately, in addition to my near-addiction reading of the news online at regular intervals throughout the day. It's doomsday report after doomsday report on the state of our economy. Even yesterday, when the stock market rallied in a somewhat significant way, that was given very, very little attention.

So what role does the media itself play in our recovery? I certainly don't expect them to paint rosy pictures when people are suffering, but at the same time, they don't even seem the slightest bit intent on tempering their tone. I can't help but think of how these daily and hourly horror reports don't feed themselves back into the economic crisis itself, as people and companies with jobs and money continue to hold onto it, just in case the worst is yet to come.

Maybe I'm crazy, but I'm starting to grow concerned that the media itself will single handedly prolong the depression. Your thoughts?

[DJ13]

1. "At what point....."

We passed that point when they became stenographers in the runup to Bush invading Iraq, then continued carrying water for Bush ever since.

(And they still do.)

Today nothing has changed, they still represent the corporate party, the GOP.

[alwysdrunk]

2. About 5 weeks ago

24 Hour doom and gloom. Asking every panelist "Is this the second great depression". Consumer confidence is a far more important component of our economy than any stock index, and the media is doing their damnedest to stomp on it and keep there boot there.

[Nicholas D Wolfwood]

4. I'm inclined to agree with you on this one.

One poster below posited 6-months to a year ago... but the coverage was likely somewhat warranted then. There's no way you can avoid discussing it when something happens like Bear Stearns collapsing.

Now though? Outside of job loss reports and the market itself continuing to decline, it's been way overkill.

[liberal N proud]

3. We are so past that point

6 month ago, 1 year ago maybe longer?

[Median Democrat]

5. We Are Way Passed This Point - HuffPo Article Describes How Corporate Media Is Part Of The Problem

Here is Cenk discussing some of the problems in current media, which is happy to blame the Obama administration, but avoids questioning the folks who caused this mess:

http://www.huffingtonpost.com/cenk-uygur/the-real-problem-with-cnb_b_173761.html

/snip

I have a close friend who works at a business news station -- and here is the worst kept secret in show business -- it's all about the access. If you piss off the CEOs or the companies, you're going to get a call from your boss. You have jeopardized our relationship with them!

That is very thinly disguised code words for -- don't ever say anything negative about a company we cover otherwise your job is in the trouble. The message is clear -- go along to get along. This isn't journalism. It's public relations by another name.

CNBC never did any exposés about the enormous risks these financial companies took. They never exposed the insanity of the derivatives market. And they never told their audience that the executives of these companies have been robbing their shareholders blind. Because they didn't see that as their job. They saw their job as doing whatever it took to keep Wall Street happy and playing ball with them.

They were part of the broken system. There was no journalism going on at CNBC. That is what our underlying complaint is. That is what CNBC continues to miss to this day as they try to defend themselves by saying their words were taken out of context. The problem was the context!

Will they straighten ship and start doing real investigative journalism uncovering the abuses of Wall Street now that they have been called out. I doubt it. That's not how they're structured. They don't view the average guy in their audience or the American public overall as their main constituency. They view Wall Street as their constituency. So, they will continue to serve them.

/snip

[T Wolf]

6. The corporate media, as mechanized infantry (much more powerful than mere foot

soldiers) for their owners, have long passed the point where they are doing harm.

They have yelled "fire" in the theater of our economy for a long time and need to be sanctioned for that crime.

[Nicholas D Wolfwood]

7. Here's the fly in your ointment.

You call them the corporate media - and that's true. But don't they have as much at stake as anyone in this? Especially the ones owned by conglomerates with other interests (like NBC with GE, ABC with Disney), wouldn't they benefit more by portraying the economy in manner so as to boost up the profit lines across the board?

[T Wolf]

11. I believe that they adhere to the principle espoused by Andrew Carnegie - "in a depression,

wealth returns to its true and rightful owners."

They are so totally under the control of the few (five) entities that own almost all of the media outlets in this country that it is simply a matter of following orders.

Murdoch lost a couple of billion in the last quarter - has Fucks changed their tune?

In seeking to regain total control of the economy, or at least, make sure that the Dems and working people do not get any foothold in the executive suite, they are doing everything in their power to insure that Obama fails. Then, they will be unopposed when they swoop back into power.

Call it a conspiracy, but it is much more open and obvious than any secret plan. They believe that they have the right to reinstate their rule, regardless of what the people said in the last two elections. With (practically) no one in the media refuting their arguments, their message is dominating and has enormous power.

[Median Democrat]

12. Its A Giant CYA - They Cheerleaded The Bubble - Ignored The Warning Signs

Now that the lipstick is off the pig, they are blaming Obama for the economy, rather than acknowledging that the media did a piss poor job of reporting. For example, back in 2007, the media was proclaiming that the subprime mortgage crisis was over, and cheerleading stocks.

Now, as things go to hell, rather than acknowledge their failure to report, they are now just blindly attributing every fall in the stock market to things Obama has said, rather than the economic reports on events that took place last year such as the fourth quarter 2008 GDP results.

[Supersedeas]

13. this economic message brought to you by WallMart -- pending legislation could make it worse

[raebrek]

8. Yea, I'm there too. N/T

[TexasObserver]

9. It's happening right now.

The whole CNBC presentation 24/7 is calculated to besmirch everything Obama is doing. Whether from design or idiocy, this constant barrage is affecting the markets. However, I choose to look on the bright side:

These talking heads are allowing their political disdain for Obama to override their good sense. One of these days soon, they'll all realize it's THEIR port folios they're killing in the process. It's THEIR home values they're destroying.

We're going to build a floor in these markets in the next few months, and then we'll start the long walk back to good economic health. These yahoos at CNBC haven't been right about anything in years, and that's going to continue.

[Nicholas D Wolfwood]

10. Agreed

I do believe the market's floor is very, very near. Call me optimistic, but I don't think we're going to get much worse, at least market-wise. On the other side, I do have some hope for Obama's stimulus. It'll take a while, and I'm not sure anyone in the world is going to get back to where we were (unforeseen bubble notwithstanding). I think the market's over-corrected and will bounce back somewhere in between.

[yorkie]

14. I think constant coverage has an adverse effect

How can anyone do anything or accomplish anything with cameras and reporters everywhere? Everyone seems to want to grandstand and produce soundbites-politicians and media alike. I have been thinking we should not have constant reporting of everything-but with 24 hour cable that's a lot to hope for.I wish people could just do their work, and when it's done they could discuss it. And reporters should not be discussing every uptick or downturn-cycles are normal.

[Jim Sagle]

15. At some point that was reached several decades ago.

[Clio the Leo]

16. Fortunately, the President is well aware of this fact.

Why do you think we got this kick ass speech today?

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=132&topic_id=8256918&mesg_id=8256918

[Nicholas D Wolfwood]

17. Fortunately, we have President Obama indeed.

If ever there were a President that the times themselves specifically selected, it is this one. I'm not a believer in fate, but damn does he make me lean that way.

[AngryAmish]

18. About GE - they won't say how much toxic assets they have

"The world’s biggest maker of jet engines and power turbines told shareholders last week that 2 percent of GE Capital Corp.’s assets are being valued based on market prices. The remaining $624 billion is being carried at levels that GE, the last original member of the Dow Jones Industrial Average, established in many cases years ago, according to CreditSights Inc.

“The notion of having 98 percent opaque and 2 percent valued with clarity is something that by its very nature would make investors nervous,” said Robert Arnott, founder of Research Affiliates LLC, which oversees $30 billion in Newport Beach, California and owned 481,201 GE shares as of Dec. 31. “Having some clarity on what the other 98 percent is worth is valuable.”"

<http://www.bloomberg.com/apps/news?pid=20601082&sid=aanSIg9Vo6hA&refer=canada>

I wouldn't touch GE. GE makes stuff, but GE Capital may be worse than a lot of other banks.

[FudaFuda]

19. right about the same time the sun comes up

every day

[Kurt_and_Hunter]

20. The media talking up the economy was ultimately even more damaging

Public opinion does drive economies and the media is an important factor, but in a free society the effect is of primarily academic interest since the media cannot (and must not) be regulated.

That said, the media exist (in aggregate) for one reason: to sell advertising for products. There is a built in pro-consumption bias that translates to economic boosterism. But they use hysteria to sell those ads leading to the odd dynamic of the media using economic decline as a hook to get viewers to sell products.

The media was probably more central to the bubble than to the decline. And there is no such thing as a bubble without a crushing decline so the upside effect was--in the big picture--even more pernicious.

[leftofthedial]

21. beginning with the creation of CNBC

(which has led the charge into two absurd bubbles in less than a decade) would be a good starting point.