If your mother tells you she loves you, check it out — Anonymous
LA Times columnist Michael Hiltzik wrote an important piece last month headlined, “How Apple invites facile analysis.” It’s worth a careful read by every business journalist, whether you’re a reporter, editor or commentator, whether you cover technology or not. I don’t want to do an injustice by simplifying his careful and nuanced argument. But one critical lesson is how easily we can get swept up in a herd mentality.
…the sentiment and stock action related to Apple offer a perfect study in how conjecture and misunderstanding can trump actual knowledge when it comes to evaluating a company. When the company is as much the focus of worldwide attention and as uncommunicative about its own plans as Apple, the effect is even sharper.
Yes, Apple is perfect, but the danger of group think is apparent on every beat. Remember when Jack Welch was the greatest chief executive in history? When the traditional business cycle was gone, trumped by technology? When price-to-earnings ratios didn’t matter and, indeed, actual earnings were irrelevant — or so it seemed at the time. You remember the housing bubble, and before that the dot-com bubble and those Amazing Corporate Miracles such as Enron, HealthSouth and Tyco.
There are quite a few honorable exceptions, but our profession hasn’t covered itself with glory on these and numerous other stories. Our failings have been particularly acute as disasters were gathering, when more skeptical, careful reporting might have helped avoid the worst. We’re not flacks or cheerleaders or publicists. We serve the public trust and owe our readers nothing less than the best available version of the truth at that moment — and the willingness to ask loads of questions. This is a tough profession, demanding discipline, constant learning — and a certain monasticism, despite all the cant a few years ago about how journalists should be more involved in, and reflective of, “the community.”
I also understand the many traps. Some corporate owners want “positive news” and degrade the years of training and seasoning it takes to make a capable financial journalist. “Don’t be such a gloomy Gus…why are you always to negative,” can even come from friends and family. The public relations field is more sophisticated than ever before. Technology has sped up reaction times, and too often reporters and editors must become instant experts. Corporations lean on publishers and buy academics. Many advocacy groups masquerade as “think tanks,” but don’t actually provide reliable information. Critical thinking has been diminished. Meanwhile, all across the culture: Sell, sell, sell, always be selling. And the media can be the biggest herd of all. The federal debt and deficit are the biggest immediate crisis we face, right? Actually, no, based on economic metrics and much research. But much of the media would have you believe otherwise.
So be wary. Mistrust the conventional wisdom. Ask a lot of questions of many sources, and always consider their potential biases. Challenge assumptions, especially when everything seems to be going great or terrible (.e.g Apple), based on the herd. Beware of “confirmation bias,” where you seek out the information that only fits your thesis. Never do a single-source story. Dig deeper. Peel back the onion. None of this is brain surgery.
So why do we keep getting punked?