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Who Drives Financial News, the Media or Wall Street?

“So much coverage of news in the financial markets is a prop for trade,” Bill Barnhart, MST ’69, MBA ’ 81, financial markets columnist for the Chicago Tribune, told the International Roundtable June 16 at Gleacher Center.

Barnhart cited recent stories about Chinese currency as coverage more about moving the market than real news. “There’s been a hue and cry about the yuan being pegged to the U.S. dollar,” he said. “That’s because U.S. manufacturers want the dollar depreciated to make their products more competitive. But there’s no need to revalue the yuan. The story was a trading prop for the marketplace.”

Props for the marketplace get told as legitimate news in part because “covering globalization and international investing is about telling stories,” Barnhart said. The problem is that “the financial press is guilty of not standing firm on the story they’re trying to tell.” It gets caught up playing to its sources, often domestic [firms] on Wall Street. “I think business writers want to look like insiders, so they write for their sources rather than the public,” Barnhart said.

Or they write for the public, with less regard for true news value. For example, as the dollar weakens, international mutual funds profit. As a result, there’s “a demand for stories about the dollar and international currency,” Barnhart said. “People realize they can make money, so they want stories. The actual news gets lost as people focus on personal issues.”

As a columnist, Barnhart said he tries to, “set the scene for the reader” and is less interested in reporting news than in applying perspective to and anticipating the effect of news. “What I took away from the GSB as a writer,” he said, “was a way of looking at concepts that made them clear for others.”

 Carmen Marti