Sometimes The Business Press Maven has to bust his little buns, looking far and wide to find business articles so bad that they appear custom designed to fool investors. Other times, the bad articles all but jump out and grab me.
And so it was that I was reading
The Wall Street Journal
on Friday. Teased on the very first page in a blurb was an article, which ran on A13, that all but begged to be put out of its misery. The mistake it made was so basic but for some odd duck reason appears so frequently that you need to know what is going on. Bear with me for a minute, while I walk you through the top of the article.
The headline held promise: "U.S. Auto Makers Gain A Bit on Japan's Quality."
It hinted at a reversal of fortune. I also liked the measured "A Bit," figuring that such restraint was evidence of a journalist who would not let their emotion get it the way of the facts.
U.S. automakers have been the lame boats of
reliability surveys, and now here was a subheadline telling me that some models got good rankings in the latest report.
So much has gone wrong with the American automakers for so long that the contrarian in me wants to find a reason to be positive. And the journalist in me would just like a story line different from "GM Disappoints. Looks for Management Help."
Was this it? Finally, improbably, a turn toward quality?
Seemed so from the lead: "U.S. auto makers got a small lift from a new
survey that found some models closing the reliability gap with their foreign competitors."
Even that phrase -- "a small lift" -- seemed to carry with it precision, thus earnings my trust.
We soon learn that three of
newest models scored among the top reliable vehicles, one the second-most reliable car. And?
Well, there is no "and."
Turns out 39 of the 47 vehicles with the highest reliability rating are still Japanese. And the comparison with last year? That all-important reference point?
Well once again -- this time inexcusably -- there is no "and." That's right:
The Wall Street Journal
tried to draw a conclusion over a reported number, without offering a comparable. For that they obviously earn the dreaded Business Press Maven "Back of the Hand" award. If I had two to give out, I'd throw both at 'em.
say last year? Don't worry,
Wall Street Journal
, The Business Press Maven will do your heavy lifting for you. Last year there were 47 highly reliable cars and six were American. That means that, indeed, American automakers may have made slight statistical progress on that front. But we don't know that without knowing that number; moreover, we can't be sure if there is some flukish element to that number until we compare the least-reliable car list. This year about half the cars on it were American. Last year, also roughly half.
"It is mainly a perception gap," Ford's director of global quality is allowed to gloat in the article of the fight to overcome people's faith in foreign carmakers and lack of it with the domestic producers. But looking at how the highest-reliability ratings barely budged and the lowest did not, one has to dismiss such corporate flackery.
I wish we could as easily dismiss business journalists who traffic in statistics without offering comparables. It is a practice that ties an anchor to the portfolio of any investor who reads such nonsense uncritically.
While we are on the subject of nonsense, the business media, on the whole, fell for the Internet boom just as they fell for the technology boom (radio, motor car, airplane) that was the biggest contributor to the Crash of 1929. Anyhow, after the most recent technology bubble burst in 2000, the business media did not want to get tricked again. They immediately began prognosticating the popping of the real estate bubble, which unfortunately for them did not start to happen for another six years. Now the flavor of the day in terms of bubble prediction is hedge funds. This week on
, Dylan Ratigan sounded a bit like he needed some Ritalin as he went all snarky on the author of "Hedge Funds for Dummies."
Said Ratigan: "It is an irony, however, that you take what is supposed to be the most sophisticated, least-accessible group for investors -- the one that's supposed be only for the super rich, where you can lose a lot of money, la-la-la-la-la ..."
The Business Press Maven has a soft spot in his heart for any business journalist who uses any "la-la" formation. And since I barely know anyone now who is not employed by a hedge fund, including people from unrelated fields, the area does have a top-of-market feel to it.
But let me make something very clear to those declaring the coming death of all hedge funds any time one goes kaput. Hedge funds are a fee structure. They are not any one asset class. You can argue that the fees are too high and they might fall out of fashion "a bit," as
might say. But they simply cannot fail
. Some are invested in one type of stocks, some others. Some are long, some are short. Only a single asset class -- technology stocks, real estate or The Business Press Maven's patience -- can fail all at once.
A journalist with a background on Wall Street, Marek Fuchs has written the County Lines column for The New York Times for the past five years. He also contributes regular breaking news and feature stories to many of the paper's other sections, including Metro, National and Sports. Fuchs was the editor-in-chief of Fertilemind.net, a financial Web site twice named "Best of the Web" by Forbes Magazine. He was also a stockbroker with Shearson Lehman Brothers in Manhattan and a money manager. He is currently writing a chapter for a book coming out in early 2007 on a really embarrassing subject. He lives in a loud house with three children.