Watching September stock moves

Not content to celebrate the U.S. stock market’s modest summer rebound, analysts already are spreading doom.

September, they remind is, historically is the market’s worst-performing month – down an average of 1.4 percent since the great crash of 1929.

Which, by the way, took place at the end of October. The big market crash of 1987 took place that month, too, with Black Monday – October 19 – capping the selloff with the largest one-day U.S. market decline ever.

Despite the past October drama, though, September remains an ominous month for investors. And whether or not major indices do tank or buck the trend and remain buoyant, your readers will expect periodic analysis of what’s going on. The time to prepare is now, before you’re staring at CNBC some autumn afternoon watching those bright-red down arrows.

For a primer on covering market moves, check out this earlier tipsheet. As I mentioned there, I really don’t approve of riling readers with every change of direction the stock market makes. Investing, for most individuals, is a long-term proposition. Professional traders may jump in and out on a daily, hourly or minute-by-minute basis, but people saving for retirement shouldn’t be primed to react at every little blip of the Dow Jones ticker. The results can be tragic.

So don’t feed the fear. But don’t ignore your audience’s concerns, either. The best way to present a balanced approach to market swings – especially the further east you are, since that 4 p.m. close doesn’t leave much time before deadline – is to plan ahead. Start now to line up a stable of market experts who represent a variety of views and approaches – bank economists, CFPs, academics, market historians, traders. Get their after-hours contact info and have it at hand.

Get graphics underway, now, too, if you don’t already have standing Dow, S&P 500 and NASDAQ charts in the hopper. That will save valuable time on deadline. Weekly closing values are the usual data points for stock market charts.

Most important, line up your consumer voices in advance. No market story is complete without a retiree, an aggressive investor, a novice or all three to add perspective. Local investment clubs are a good source of knowledgeable average investors. BetterInvesting (the former National Association of Investors Corp.) is a 50-year-plus coalition of local investment groups; it specializes in educational materials and often will hook you up with members in your area.

Try to get permission to attend some meetings and take a look at real portfolios to better understand the way market gyrations and the way we cover them affect the nest eggs – and emotions – of average people.

Come back to Your Daily Tipsheet each morning for advice on where to find sources, background and creative ways to make financial news and trends relevant to your audience.

When banks go bad

Nothing quite kills that T.G.I.F. buzz like word that your bank has been seized by the feds.

But it’s even more of a downer if you happen to be the financial reporter on duty, with an empty notebook and two hours to go before that 7 p.m. deadline.

Think it can’t happen on your watch? So far this year, regulators have shut down nearly 80 banks, ranging from $25 billion household names like Colonial Bank to little Corn Belt Bank and Trust Co. of Pittsfield, Ill.

With four more months left to go in the year and a recent warning from Congress that many banks still are in jeopardy due to the troubled loans and other iffy assets they hold. (For basic information about understanding bank financials and regulation, check out this previous tipsheet.)

Doing a little advance work could save you a lot of stress one of these Friday nights. Besides, few things rattle readers like bank failures, and you’ll want to be their go-to site for updates and reassurance.

Few industries have such labyrinthine regulatory arrangements – depending on a bank’s charter they could be supervised by one of several state or federal agencies. Before crunch time, you might want to make a simple spreadsheet listing the financial institutions in your area, the relevant oversight body and key after-hours contact info for each.

Fortunately the Federal Deposit Insurance Corp. (FDIC)– the government body that insures deposits and usually becomes the receiver of troubled banks – also is a central clearinghouse for reporters and consumers.

Andrew Gray, the FDIC director of public affairs, says the FDIC sends out press releases on every bank closure concurrent with the release from the regulatory body. Nothing is ever embargoed or released selectively in advance, Gray said, because generally banks are scurrying until the absolute last minute to obtain financing or other means of staying liquid. So if you go to the FDIC site and sign up for e-mail releases, you’ll get the news at the same time everyone else does.

The FDIC and related sites also have a font of consumer protection info, with FAQs about deposit insurance and other things your readers want to know. With so many bank failures in the news right now, it would be smart to put together a little Web package outlining bank insurance basics, hotlines, Internet sites and other resources. Then, if one happens in your market, you can pop that up online with a few preliminary points from the press release and not waste precious time creating a fact box.

Bank failures tend to be announced on Friday nights, Gray said, because it gives the feds the weekend to straighten out paperwork and “make sure it’s business as usual on Monday morning. Consumers are going to see the same faces they saw on Friday.”


For reporters, it’s not as grim as after-hours news could be – Gray said the media is welcome on site at failed banks – the next day, if the bank in question has Saturday hours - and that one of his staff or an FDIC ombudsman will be on hand to field questions. Better yet, the media relations contact numbers on the FDIC releases are answered nights and weekends, so you won’t have to wring your hands until Monday for official comment. If the failed bank is being acquired, the FDIC likely can put you in touch with the new owners, Gray said.

Of course, you’ll also want to talk to bank patrons, industry analysts and shareholders – more people whose cell phone numbers you should get now, not next Friday at 5:45 p.m.

Come back to Your Daily Tipsheet each morning for advice on where to find sources, background and creative ways to make financial news and trends relevant to your audience.

Black gold, Texas tea

If you’re having one of those days, cheer up by reminding yourself: “Well, at least I didn’t buy oil futures at $140 a barrel last year.”

Crude is trading at about half that now. Demand for energy tends to wane in a recession, with businesses stoking few factories, truckers toting fewer goods and – in the U.S. alone – about 6 million ex-workers not making that daily commute.

That’s the simplified version, of course, and many other factors – geopolitics, world currency values, inventories, what the cartel decides to do – also affect petroleum prices. And they’re creeping up, which is why you might want to put an oil story on your agenda soon.

If you’re not in an oil-producing state, you still might have refineries, a pipeline or some link in the supply chain, oil recyclers, transporters, exploration and certainly consumption. Not all oil-related firms are run by swaggering billionaires; poke around and see what you can find in your market.

Meanwhile, if you think Brent Crude is an adult film star and West Texas Intermediate sounds like a middle school somewhere near El Paso, take heart. There are plenty of resources for understanding those two common petroleum benchmarks and lots more about world’s most hotly traded commodity.

Start with the Energy Industry Administration. This unit of the U.S. Department of Energy has accessible analysts, tons of explanatory background material, historical price data for your charts and graphics and much more on its petroleum page. It even offers a chatty “This Week in Petroleum” newsletter; sign up here for e-mail feeds.

Here are other helpful sources on oil; several feature spreadsheets, databases and other elements that make great sidebars or interactive Web tools for your online packages

• American Petroleum Institute, an industry group.
• Pipeline101, another industry site with helpful info about the nation’s 200,000 miles of oil pipeline.
• NYMEX, the New York Mercantile Exchange, where oil futures are traded.
• Rigzone, an industry publication.
• Your state’s public service or utility commission.

Rising oil prices are sometimes a sign of economic recovery as corporations and consumers have more activity to fuel. Pundits lately are divided on whether that’s at work now, or whether the weaker dollar is just luring more traders into oil futures. Either way, a higher cost per barrel will translate into more expensive transportation and heating this fall.

Come back to Your Daily Tipsheet each morning for advice on where to find sources, background and creative ways to make financial news and trends relevant to your audience.

Resale Earns Respect

Thrift shopping’s image has gone from shabby to chic over the past year or so, with all sorts of newly minted ‘frugalistas’ touting the joys of secondhand bargains on approximately 9 million new personal blogs and message boards devoted to saving money during a recession.

Those of us who’ve long been able to spot a piece of vintage Fiesta ware at 50 feet, or snap up a never-worn black cashmere swing coat for a song, have viewed the energetic new competition with alarm.

But there is no question about it: Secondhand stores are mainstream these days and as such, belong in your business pages, as small business stories, sources for money-saving tips, reflections of the local economy, new tenants for vacant commercial space and other facets of the financial prism.

This year, the National Retail Federation even queried consumers about resale shopping for its venerable back-to-school sales survey. Discount stores still reign supreme but 18 percent of shoppers polled said they’ll be hitting thrift shops for school-days deals.

They’ll have plenty from which to choose. The National Association of Retail and Thrift Shops estimates that there are 25,000 to 30,000 non-profit and for-profit thrift, consignment and retail shops nationwide. In a recent survey, 64 percent of NARTS members reported that second-quarter sales were up an average 31 percent in 2009 compared to the same three months in 2008.

Two-thirds of sellers also said the volume of incoming inventory (traditionally from individuals looking to sell off discarded goods) also was up, and the quality of items had increased. In other words, dollar-wise consumers are cleaning out closets and donating goods for a tax write-off or consigning them to sale in hopes of a profit.

Audiences love to read about bargains and the multimedia/graphic possibilities abound – list of area thrift shops, tips from proprietors about how to make the most of consignment sales, tips from savvy consumers about how to unearth the best find. For the latter, just Google something like “garage sale queen” or “yard sale fanatic,” to find plenty of blogs by homegrown experts. Show readers what they can get for a $20 bill and two hours. Video a seasoned secondhander on the hunt.

A few resellers, like Plato’s Closet, Play It Again Sports and Children’s Orchard, are corporate franchises. Many more are mom-and-pop. Check out Too Good To Be Threw, the commercial site of veteran thrift store owner and how-to author Kate Holmes. She’s so immersed in the lifestyle she’s also written a resale-themed murder mystery! Resale.net has lots of interesting grass-roots links, and The National Flea Market Association is a portal to casual and weekend resellers; again, conversations with these folks can lead to pithy insights into your local economy. The NFAA even offers a “Flea Finder” interactive map linking to market sites state-by-state.

The main difficulty in covering the secondhand economy is finding objective third parties to help with perspective. Most academic and bank analysts don’t bother tracking used-goods stores. One source of expert commentary is the professional group for what used to be called ‘home ec.’ The media relations staff at the American Association of Family and Consumer Sciences will help you find experts who can talk about consumer habits and trends in your area.

Come back to Your Daily Tipsheet each morning for advice on where to find sources, background and creative ways to make financial news and trends relevant to your audience.

All Eyes on Automakers

Monthly U.S. auto sales tallies are always closely watched, but Monday’s numbers will be especially interesting because they’ll reflect a full week of sales under the federal "cash for clunkers" program.

Automotive sales, of course, have spent the past year in a free fall, sending General Motors and Chrysler to bankruptcy court and Capitol Hill for concessions. Thousands of workers have been furloughed, bought out, retired early or laid off.

Here’s how drastic the drop has been: In 2007, U.S. consumers wheeled away in some 16 million new cars trucks. This year, the most upbeat forecasters predict total sales of – maybe – 10 million vehicles. That’s nearly a 40 percent drop in two years – meaning 40 percent less revenue for pretty much the entire supply chain and everyone connected with auto retailers.

So even if you don’t have a car company headquarters or factory in your territory, chances are a good number of your readers have a vested industry in the health of the auto industry.(After all, as taxpayers they now own a majority stake in GM!)

The automakers – including the U.S. units of transplant and overseas companies, report monthly sales a day or two after the last business session of the previous month. Autodata Corp., an information service for the industry, posts the release calendar and year-to-date figures free of charge on its Web site.

The June tally is up now; take a look to make sure you understand the terminology. First you’ll see the year-over-year results – last June compared to this June, in raw numbers and in percentage-point change. (Those are the negative numbers in the third column, for most brands.) The next three columns are cumulative sales year-to-date, compared to the same period in 2008.

You also should understand SAAR – that is, the seasonally adjusted annual rate of sales, a measure of how many cars could be expected to sell in a year if the pace of the current month continues.

Autodata also provides an aggregated spreadsheet at the end of the day to some media outlets; the reports are a valuable shortcut in creating charts and info boxes. The firm has been inundated of late with media requests and might switch to a paid subscription, so don’t put away your calculator just yet. Meanwhile, a polite request to media@motorintelligence.com may just get you a coveted spot on their distribution list.

Another way to prep: Check out the company-by-company forecasts by industry watchers such as Edmunds.com; while not infallible, these predictions can help you get a feel for the story-du-jour in auto sales. Sometimes it’s external forces like the current rebate program; other months it’s the horse race for the No. 1 position or the dive in truck and SUV demand.

Individual company releases (sign up for them at individual automaker media Web sites or via PR Newswire – and do it today, not Monday) come in no particular order and trickle out after noon on the appointed date – leaving you the morning free to troll dealerships for retailer and consumer comments.

Check around today to see if you can sit in on (and video) the closing of a new-car deal Monday morning; hearing the voice of a consumer who decided to take the plunge – and the reasoning behind his or her purchase – will add quite a bit of human interest to what can seem like a dry numbers story. With billions of taxpayer dollars and hundreds of thousands of jobs at stake, car sales reports these days are anything but routine.

Come back to Your Daily Tipsheet each morning for advice on where to find sources, background and creative ways to make financial news and trends relevant to your audience.

Revving Up Airline Coverage

Now’s about the time for those midsummer doldrums when we all dream of jetting off to an exotic locale…or even someplace just moderately exciting.

Businesses writers without cash for a trip can do the next best thing - catch up with the airline business.

Even if you don’t have a major carrier headquartered inside your beat, you probably have an airport nearby that employs part of your audience either directly or in ancillary jobs with suppliers, cargo handlers, cleaners, the security force and other support services.

And the aircraft themselves ferry inbound tourists, business travelers and other passengers who leave their economic footprint in your area.

So spend some time developing a dossier on air traffic in your region. Which carriers are dominant? Check out their financials – most airlines are reporting earnings this week – and sign up at their media relations centers for e-mail feeds.

Are there any specialty firms like vacation charter services, corporate jet sharing programs or private shuttles operating out of your region? They – along with hands-on suppliers like the catering companies, the cleaning services, airport concessions operators – can provide useful data about traveler habits as well as interesting fodder for feature stories. For example, why does a snack pack worth $1.99 on land cost $8 aloft, and who gets to pick out the ingredients?

Your airport authority reports are public record; often available on Web sites. Traffic figures, landing fee revenues and other data should point you to key players.
Other helpful sources of data include:

• Bureau of Transportation Statistics - They offer stats including passenger counts, load factors, airport passenger counts and so on.

• Air Transport Association - This industry trade group’s Web site is packed with data and explanations; the ATA spokesman and economists are accessible and in tune with economic trends.

• International Air Transport Association - This is a Montreal-based organization representing 90 percent of carriers around the globe. They're particularly helpful with industry-wide issues, and will frequently offer economists or officers to speak to the media on issues that carriers themselves might not want to comment on. If you cover a major tourist destination, they can offer insight about patterns of foreign visitors.

Fuel is a huge cost factor for airlines; in fact those few who do manage to eke out a profit these days usually do so based on their fuel hedging practices (buying ahead at what they hope are rock-bottom prices.) Check with the Energy Information Administration, the federal fuel-information site, for helpful current and historical info on jet fuel prices.

Another helpful source of data and links: The Aviation Database. This is actually a fee-based consultancy that generates customized reports for people/businesses, but they have an excellent collection of historical stats and links to other sites that have great information.

Despite the hassles of flying these days, aviation is still a rather sexy business that lends itself to consumer pieces or just plain interesting feature stories. So forgive the cliché, but visit your local airport soon and let your writer’s imagination soar.

Come back to Your Daily Tipsheet each morning for advice on where to find sources, background and creative ways to make financial news and trends relevant to your audience.