Analyst Does a U-Turn on GM

Little is as dysfunctional these days as the American auto industry, but the relationship between the business media and analysts comes close.

The business media need Wall Street analysts for quotes and perspective to fill their articles, so they are loath to criticize analysts or scrutinize their statements, especially their flashy, attention-grabbing statements. And so it was when, it the midst of too many troubles to count for General Motors(GM), a Deutsche Bank analyst recently came out with a price target: zero.

Ouch.

The issues of financing, debt, firings and government bailouts are complicated and have been written about millions of times. But this price target of zero -- for the iconic General Motors, no less -- was as catchy as a show tune, and the business media have really run with it.

Keeping both feet planted firmly in the air is the way of the Wall Street analyst, and it's the business media's job to keep that in mind. Instead of using analyst quotes as mere article filler, the business media should at least attempt to put the comments in context. Do the analysts know what they're talking about long term? Or are they simply living in the moment by issuing attention-hogging quotes or price targets?

To be fair, I don't necessarily disagree with Deutsche Bank analyst Rod Lache about the price target. And while he's had mostly positive things to say about General Motors before turning against them, Lache did also say some negative things.