Business journalists and reporters who cover money often find themselves needing sources on short notice. In the episode, co-hosts Micki Maynard and Mark Remillard recommend where to start looking for sources and how to find people who are knowledgeable on the subject as well as accessible. In order to have a truly good story, journalists will need a range of sources from professors and analysts to company officials. It’s especially important for business journalists to not only find diverse sources but be wary about returning to the same source over and over again to keep their reporting fresh.
Transcript
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Micki Maynard: How to Cover Money: Thinking like a business reporter, even when you’re not one. Welcome to the Reynolds Center podcast. We’re coming to you from the Donald W. Reynolds National Center for Business Journalism. We’re based at the Walter Cronkite School of Journalism and Mass Communication at Arizona State University. I’m Micki Maynard, Director of the Reynolds Center, and with me is my co-host, Mark Remillard. He’s a Cronkite school alum and a reporter and anchor with KTAR News in Phoenix. Hi Mark!
Remillard: Hello again Micki.
Maynard: Today we bring you, Series 1, Episode 6: Finding The Best Sources.
Remillard: Yeah, one of the biggest challenges for journalists covering money stories is to find good sources. So let’s take a look at some of the best places to begin.
Maynard: So one of the places that people don’t always think about is universities, and that’s actually the place that I like to start first. There are experts in everything at a university, and professors love to talk. Professors are also great because they’re teachers, so they’re used to dealing with people who are new to subjects. And a wonderful advantage to using university professors, a practical one, is that you can play time zones to your advantage. So if you’re on deadline on the East Coast, you can call somebody on the West Coast.
Remillard: How do you go about finding those professors?
Maynard: Well, it’s easier than it ever used to be. Most professors these days have home pages with their email and their phone contact information. They often will list their office phone. And if you call their office phone and don’t reach them, they’ll sometimes put their cell phone on their office phone. They don’t like to list it publicly, but they will list it for people who are looking for them. And a lot of universities have communications departments, so you can call them and say, “I’m looking for a professor who can talk about municipal bankruptcy,” and they’ll know somebody. And then a lot of these universities now have expert lists on their website. So you just Google “experts on municipal bankruptcy University,” and you might get a source list that will give you several options.
Remillard: While professors can be a good place to start. They definitely have some drawbacks. What are some of those?
Maynard: So once in a while you’re going to come across a professor who isn’t up on the latest news. And the thing to remember is that some professors are academic professors, PhDs, and others are professors of practice, like me at Arizona State University. So sometimes the academic professors are looking at the very long term for something, and they’re not keeping track of the absolute latest headlines and the Twitter feeds and things like that, because that’s just not their field. But what you want to do is have the latest information lined up, and because they have perspective on the situation, usually they can put it into some context that’s pretty valuable.
Remillard: What are some other places to look for sources, besides universities and professors?
Maynard: Well, so for business journalists, one of the classic places that we’ve always looked are Wall Street analysts and also the independent analysts. So these are people that follow an industry or they cover a company stock. These people are fairly easy to find. A number of corporations now have lists of analysts right on their institutional investor pages. So you go to the investor page and they will say, these five analysts cover us, and they’ll list their contact information. It’s very, very helpful. What you want to know about these analysts is that many of them publish research reports, and so they’re usually pretty happy to share them with reporters, because they want publicity, you know, as much as you want to quote. But sometimes the analysts have to get permission from their corporate communications department, and sometimes they’re limited on specifically what they can talk about, and that does slow things up a little bit.
Remillard: What are a few examples of these industry analysts I’m thinking of like the street, which I believe is run by Jim Cramer, someone like that?
Maynard: Yeah, so someone like Jim Cramer. There’s some very famous auto analysts. There’s one at Morgan Stanley in London called Adam Jonas, that everybody pays a ton of attention to. There are other analysts who specialize in retail. There are some that specialize in technology, pretty much anything. If the stock is publicly traded, it is likely that an investment house has someone assigned to follow that company, and they are pretty easy to find. I mean, I would just google the name of the company and analyst, and that should get you some names.
Remillard: What are some of the drawbacks to using analysts as sources?
Maynard: Well, the big brokerage houses have what are called buy-side analysts and sell-side analysts. And so what happened before the crash, before 2008, was that analysts, there didn’t have to be as much public disclosure on which side an analyst was on. And that caused all kinds of problems, because there’s a phrase called “making a market in a stock,” and you might have an analyst talking about a company in which his investment bank had a position, and so that person might be saying favorable things about a company, and he didn’t know that his company had a position. And now that all has to be publicly disclosed. So when we talk about buy-side analysts and sell-side analysts, usually the buy-side analysts are the one that want you to buy the stock, and the sell-side analysts are usually representing companies that are trying to peddle the stock or sell stocks. So these analysts not only comment on a company, but they also might be involved in trading in the stock, and they now have to disclose such and such an analyst at Morgan Stanley, Morgan Stanley has a 40% stake in a company or something like that. So, these people will put ratings on the stock and make recommendations like they might have a buy recommendation or they might have a sell recommendation on a stock. And what you want to do is be very clear to your audience that so and so recommends the purchase of Coca Cola stock or Delta Airline stock or something like that. Or so and so has been bearish, which means negative, on a company, and they’ve been recommending that people who hold that stock, sell the stock. Because the one thing you don’t want to have happen, is that you fail to mention this, and then somebody posts in comments that, “well, what you didn’t mention was that analyst so and so has been telling people to flee the stock,” you know, and that puts a whole different perspective on your story. So try to be as transparent when you’re using analysts as you can.
Remillard: Yeah, you there’s always the chance that you’ll get burned in your comments if you, if you do that now, especially the articles that have that, and that’s the worst, and it really takes the wind out of your story. If all of a sudden you scroll down to the comments, the first thing at the top was, “Well, this guy failed to mention something that’s a huge conflict of interest, or, you know, or could have a sway in the story.” That’s a big deal.
Maynard: And Mark, there’s another thing that you might want to do, I mean, and it does depend on how much time you have. And a lot of times we’re thrown these financial news stories, just write up and get moving. But you might want to drill down even a little lower to see what the analysts record is on the stock. So I’m not as interested in it as other people are, but every quarter, the big news organizations like Bloomberg and Reuters will say things like, the analysts range was $0.75 to $1.25 and the company came in at $0.90. So the company was expected to come in between $0.75 and $1.25 that came in at $0.90 which would be the mid-range of analyst expectations. Okay, you want to check and see where your analyst was. So if yours was the analyst that thought it was going to come at $1.25 and it came in at $0.90 cents, something’s wrong with their projections. And likewise, if they came in at $0.75 and the number was $0.90, you might want to see how often they’ve been right and how often they’ve been wrong, because you don’t want to go with the analysts that are always wrong. And everybody in the industry knows who’s correct to the penny, essentially.
Remillard: There’s other kinds of analysts that you can find. Tell us about who they are.
Maynard: Right. So these are the analysts at the ratings agencies, which are Standard and Poor’s, Moody’s Investor Services and Fitch. And so the purpose of these places is to essentially look at the long term finances of the company and assess risk. So they look at a company and say they’re an A company which is generally called an investment grade company. And if you want more information on this whole investment grade thing, just come to businessjournalism.org, and we can explain it for you there. But the analysts at these companies are essentially specifically interested in the long term health of these companies. And they can be very good, critical sources on the companies, but you can’t use them for comments about specific personalities, like a CEO is getting a divorce and it’s distracting him from running the company. Or the chief financial officer has been wrong so many times he might be or she might be on the verge of getting fired. So you’re not going to call the these ratings agency people for comments like that. These are numbers people.
Remillard: And speaking of CEOs, you have a couple tips for people looking to understand a company.
Maynard: Right. So the world is full of former CEOs, and I find them to be very useful to provide context about a company. There are a lot of former officials who’ve worked at different companies, and you can usually get them to talk, although a lot of times they don’t want to be quoted by name, it’s just for background. But they’re usually really great for context about why a company made a decision, and context, it swings both ways. They might not like the decision, but they also might have helped the CEO get to that decision. So they’re pretty easy to find. You can look on Google, and you can look at LinkedIn. And a lot of times these people will have new ventures and they’d like some publicity, so they’re willing to trade you a quote in return, you know, in return for saying, oh, so and so, is starting a new commercial aviation company. The one thing I would be careful about with using the former-lees, as I call them, is that you want to make sure that you know where they come down with the current leadership. So there might be a former-lee who got booted out of the company and will be very critical of the current CEO, or there might be a former-lee who will never say anything bad ever about the company that they left, and so you can just pretty much be assured it’s gonna be a puffy quote. So just take it all into sort of account when you’re coming up with the idea of using one of these former executives to talk about. The other thing to remember is that the longer it is from the time they were at the company, the less likely they are to be up on the most current information. Just keep that into account.
Remillard: You so we’ve got, you know, maybe professors, some analysts, the former CEO, you’re starting to build a good picture of this company or whatever you’re covering. What are some other sources and what are some other things you can do to find sources?
Maynard: One of the most important things, I think that business journalists and people who cover money need are diverse sources. And I don’t just mean from different points of view. I mean that they look different from each other. So there’s big problem in business journalism in quoting only white males. Sorry about that Mark, but you know, there just simply aren’t enough women and African Americans and Latinos and Asians who show up in business stories. I really want people to try their hardest to emphasize diversity among your sources, especially if you live in an area where your audience is diverse. So if you live in Detroit, which is 85% African American and has quite a large Latino population, you want to make sure you can find some African Americans who can talk about things. You want to make sure that you can find Latinos to talk about things. Same is very, very true in the Southwest and in Texas and places like that where there are large Latino populations. Because if people are looking and listening to your coverage and they don’t see anyone like themselves, that’s a reason for them not to pay attention anymore. I’ve seen a lot of frustration lately among women journalists, because so many of the guests on talk shows, on Sunday especially, are white males, and that’s a reason not to watch. If there are no women showing up, you know, a lot of women won’t watch. So you want to be the reporter who tries very, very hard to find diversity.
Remillard: That can be tough to do. I think, if you’re trying to, I mean, it can be difficult in and of itself, but it’s hard to realize that you’re not diversifying your sources. Like you go about your daily, day-to-day business, and you’re getting your sources and and it might be difficult, and it’s something where you kind of have to step out to remember, you know, this is important, my readership is broad and I need to find these sources like that. And I think along with that, the other thing that’s very easy to do on a day-to-day basis is not realize, is not realizing that I’m calling the same person every single time I have this kind of story, and you really need to mix up your sources.
Maynard: Exactly. That’s a huge problem for all journalists. We quote the same people all the time, and we do it for a couple reasons. I’m not defending the practice, but this is why we do it. First of all, we can get a hold of them. When you’re looking to fill a space in a story, f you know, you can reach so and so on the phone, you’ll call them.
Remillard: You’ve got them on speed dial.
Maynard: They know how to talk. They know how to give you a good quote. And the second thing is that, you know they’re an expert. And that’s not a bad thing. I mean, they’ve got years of experience in something. But this drives editors crazy, and I’ve actually had editors ban certain people from stories simply because we called them too much. There’s a well known aviation analyst named Robert W. Mann, who I called frequently when I worked at The New York Times. And he’s someone who’s very popular. He’s on Twitter and Facebook and and someone we all believe and like to talk to. But my editor sent me an email one day that read, “No more, Mr. Mann,” and you don’t want this to happen to you.
Remillard: Exactly. That’s it for this edition of How to Cover Money. Next time, we’ll give you tips on how to avoid getting intimidated by those big name business leaders.
Maynard: Support for our podcast comes from the Donald W. Reynolds National Center for Business Journalism. Visit our website at businessjournalism.org, you can find us on Twitter @bizjournalism. That’s at B I Z journalism. You can also look us up on Facebook, LinkedIn, and Tumblr. For Mark Remillard, I’m Micki Maynard. Now, start thinking like a business reporter.
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