Apple Investors Misled by Media

We can go on and on -- and it bears mentioning (and the Chronicle did well to) that Friday's nasty planted rumor did not gain wider notice until a more mainstream magazine ran hard with it: "By 9:25 am, the widely read online magazine Silicon Alley Insider had picked up the item."

Silicon Valley Insider later published a hand-wringing, contorted explanation for giving the rumor a plea boost, essentially offering the nihilistic excuse that the Insider did not know whether the item was true or not. It was just throwing it out there for you to judge. If you see such an on-the-one-hand-on-the-other-hand treatment of a hard-and-fast truth (he's in the emergency room!), always assume it's false.

That Apple left itself open to mass panic is a big reason I've been warning investors about the way in which the company has dealt with the issue of Jobs' health. CNBC was right to place a portion of the blame on the victim:

"The trouble with Apple: the company's secretive nature, its carefully crafted image, Jobs' history of health issues and his intrinsic importance to the future success of the company all contribute to the effectiveness of these rumors in moving Apple shares. ...

"It's not true. The rumor is not true. But the reaction to it just goes to show the enormous insecurity some traders suffer toward Apple and its shares. And how easy it is to manipulate this stock. That in itself is an unfortunate risk factor investors have to accept if they're going to put their hard-earned cash into this company. How unfortunate. But such is the ridiculous climate on Wall Street right now."