Apple Investors Misled by Media

Ditto here , from Minyanville:

"Down 40% and whipsawed again by rumors of Steve Jobs' health, can we please simply concede that Apple's board of directors needs to stop fighting a rear guard position of denial and defending the stock by speaking honestly about the man's health? It's not about being right. It's about protecting shareholders."

The Wall Street Journal was right to note that the issue here was not just citizen journalism but citizen journalism given a veil of absolute legitimacy because of its affiliation with CNN. That's something for investors to be on the lookout for, but remember: Reading is not believing, no matter the source or the source's affiliation. From the WSJ (emphasis not mine):

"Were this to have appeared on a random stock messaging board somewhere, it would likely have had little impact, but CNN has put its weight behind this iReport endeavor, saying on its Web site that 'we've launched an independent world where you, the iReport.com community, tell the stories we're not used to seeing. And the most compelling, important, and urgent ones may get seen on CNN.'"

Here is another good lesson learned from The Wall Street Journal. The assumption might be that rookie investors, day-trading message board trolls and others are the ones who are felled by such rumors. But especially in such a nervy environment, the big boys are taken for a ride too:

"The volume of Apple trades spiked soon after the iReport story first appeared, meaning it wasn't just Joe Web Surfer selling Apple. One Wall Street chief information officer told us Friday that his company has developed systems that treat the Web as a big database that it mines through for information.