Beyond Investing: Buffett Tackles 'Terrible Journalism'
Specifically, Buffett wrote that his view of the economy as being "in shambles throughout 2009 -- and probably well beyond" was loudly reported, while the end of that same thought -- "but that conclusion does not tell us whether the market will rise or fall" -- was essentially ignored. This "sound-bite reporting" is "terrible journalism" and was costly to anyone who was unduly influenced to avoid stocks because they missed out on big gains as the market rallied for the majority of the year.
With his far-reaching interests in insurance, consumer products and banking, it's easy to forget that Buffett knows a thing or two about journalism: In addition to being the majority shareholder in The Washington Post Co. (WPO) and owner of The Buffalo News, he was the owner of the weekly Omaha Sun when it won a Pulitzer Prize in 1973. At DailyFinance, we believe we appropriately balanced and conveyed Buffett's thoughts in the headline -- "Buffett says economy is in shambles, but still likes stocks" -- and in the accompanying article.
Unfortunately, Buffett isn't the only well-known investor to have his words taken out of context by the sound-bite culture: Jim Rogers, a former partner at George Soros' hedge fund, recently was credited with saying that the British pound "could collapse within weeks" -- a statement that made waves in the market. Except he said no such thing: It came from a conference promoter trying to drive business.
As consumers of information in an era of compressed media cycles, readers and viewers should take a lesson from the childhood game of "whisper down the lane": What isn't heard, or what gets lost when information is relayed, is often the most important detail. So minimize the influence breathless TV personalities and loud headlines have in your financial decisions, even if they claim to be conveying the words of the great investment minds, and spend more time beyond the headlines.