Needless sensationalism

It’s that kind of heads-up thinking that keeps papers in business. And let’s not kid ourselves, this is still a business. The Sunday paper for major dailies today is another interesting case study in the newspaper industry. By far, it’s the most important day of the week for paper enterprises. Editors know that, and they always tee up a good story for the front pages. But it bothers me when I see these same so-called purveyors of journalistic integrity try to milk every last ounce of sensationalism from stories to sell a paper when the content therein should speak for itself.

Yesterday’s headline on the front page of The Washington Post is the latest example of reporter malpractice. In the hottest throes of a financial industry overhaul, the Post runs what at first reads like a Pulitzer-winning piece. “Goldman Executives Cheered Housing Market’s Decline, Newly Released E-mails Show,” blared the headline. Whoa! Tell me more, oh wise newspaper! To scan the next few paragraphs, one would think even the highest echelons of Goldman knowingly and criminally flushed their clients’ money down the toilet.

But when the average reader pauses for a second and reaches paragraph five, he quickly realizes Goldman was doing what many might expect from a financial giant — hedging its bets. This is Econ 101, folks. If you’re over-leveraged toward one side of the market, it only makes sense to have an insurance policy of sorts — to bet against your bet so just in case the bottom falls out, you (and more importantly, the thousands of your clients) don’t lose everything. To follow the logic of the Post headline-writers, risk management is a criminal offense. If that’s the case, someone lock up all the bond managers in this country. After all, they’re hoping interest rates rise.

How good could we have had it if we lost $1.2 billion in a declining housing market? asked Goldman’s spokesman when probed for a comment.

Look, I’m no fan of Goldman Sachs. The very sound of the phrase “too big to fail” makes my blood boil. But it’s times like these when Americans need the straight story from news organizations — unvarnished and in the proper context. So the next time you want to sell me a hot dog of a story, Washington Post, hold the mustard.

Visit www.armstrongwilliams.com.