At the beginning of the year, I started a new blog to keep track of tabloid headlines called It's News 2 Them™. I wanted to quantify how reliable they are on stories that can be verified, and so far this year, they suck rotten eggs. As of this morning, there are 30 celebrities that have some short amount of time to live according to the supermarket rags, and all 30 of them are currently alive. Over the same time period, several celebrities at about the same level of fame have died without any advance warning from the tabloids. For example, we have been warned about Barbara Billingsley, who is over 90 but still alive, while Dixie Carter died at 70 and her health problems were not tabloid fodder.
In short, not news you can use.
The question I have is this: Is the financial news system any better?
There were people predicting the big crash of 2008 and there were others telling us things were peachy and there was always a way to make the right bet and there was nothing to worry about. Prediction is hard, especially about the future, as either Neils Bohr or Yogi Berra once said. (My money is on Bohr.) But when a thing happens, can the financial news system tell us why after the fact?
This week, the biggest short term glitch of all time took place. In less than an hour, the Dow Jones industrials lost about 10% of its total value, about 1,000 points out of about 10,000, then recovered about 600 points just as quickly. Proctor & Gamble lost about 25% of its value in just a few minutes and for some odd reason began to trade on the NASDAQ market instead on its normal place on the Dow, and within minutes it was making a comeback.
And the financial press still doesn't know why.
The first stories were that the market was worried about Greece. The next was that it was a computer glitch. Another said some trader wanted to make a trade in the millions and instead typed in billions. There is agreement that once certain stocks fell, computerized trading programs clicked in to buy the now much cheaper but by no means worthless commodities, which is the reason for the lightning fast correction.
A lot of people who pay more attention to this stuff than I do, including Stanley Bing, Jim Cramer and Robert Reich, are absolutely convinced that somebody made a fortune in those few minutes. Bing is among those who think it could have been done on purpose. If it was, the next question is whether any laws were broken and if so, will any legal authority do anything about it? Being a Californian, this smells something like what Enron did to game the electrical grid back in the early 2000's. While some Enron officials went to jail for financial misconduct for other acts, the traders who jacked up energy prices to insane levels and joked about grandma Millie got away scot free.
In general, I get along with people well enough. I'm on the extroverted and gregarious end of the hermit spectrum. But I do have serious hermit-like tendencies, fueled by an underlying belief that as a species, we are circling the drain and it's the fate we richly deserve.
