Print Story Rupert Murdoch and the Wall Street Journal
Money
By Gedvondur (Tue May 01, 2007 at 12:17:15 PM EST) Dow Jones, WSJ, DJIA, News, Fox News, Faux News, Money, Power (all tags)


With Rupert Murdoch's offer to buy Dow Jones comes the specter of a ruthlessly conservative version of the WSJ that will have the power to influence more than just public opinion.

The Wall Street Journal, whether you agree with its conservative politics or not, gets respect from lefties as well as right-wingers for its integrity and solid business reporting.  The mere mention of a company's name in the WSJ can spell glory or doom, especially for younger businesses. 

The offer from Rupert Murdoch's News Corp to purchase the Dow Jones company and therefore the Wall Street Journal leads to serious questions about the long term viability of the WSJ as well as the short term impact the Murdoch could have on the economy, depending on how paranoid you want to be. 

If you are not familiar with the amount of influence that the WSJ wields as well as the respect it commands, I seriously recommend you read the book about the history of the publication. The text is clearly out of date, but it gives you a very good feel about who and what the WSJ really is.  In my job as an analyst and as a journalist, I have dealt with business executives at just about every level and at most of the major technology companies.  These executives read the WSJ, as do many of their direct management reports.  They take the WSJ much more seriously than virtually any other newspaper publication. 

By some accounts Murdoch seems to be a champion of the journalist and a fan of a competitive news environment.  However, I don't think that the picture is that rosy.  Some of the antics of Murdoch's Fox News enter into the realm of the dubious and often the outrageous.  Fox New's "Fair and Balanced" slogan is a classic example of say one thing, do another.

Murdoch's ownership of the WSJ could give him a business bully pulpit to spew his political agenda that would have an impact as large as or greater than Fox News.  There are also downsides that could affect the WSJ as well.  Any attempt to share content, co-brand, or in anyway associate the WSJ with Fox News will degrade the WSJ.  It would be only natural that Murdoch uses the WSJ to elevate the stature of Fox News, but this could mean the end of the WSJ as one of the most respected media organizations.  Considering the low public opinion of the media already, I cannot see the loss of the Journal's prestige as being a good thing. 

In addition to this, Dow Jones also owns the less prestigious but still important Barron's.  It would give Murdoch control of two of the top financial/business publications and a blank check to meddle.  Lastly, Dow Jones most visible product is the Dow Jones Industrial Averages, a measure of the American stock market that is taken for Gospel in regards to the health of the economy.  To quote the www.djindexes.com web site " The Dow Jones Industrial, Transportation and Utility Averages are maintained and reviewed by editors of The Wall Street Journal."

There are those who have suggested that by manipulating the companies listed in the DJIA it would be an easy way for Murdoch to give the politicians he supports the gift of a soaring stock market, at least on its face.  However, considering the venerable nature of the DJIA and the number of eyes on the companies contained therein, I find that to be an unlikely circumstance to say the least.  Still, the DJIA gives Murdoch yet another potential way to push his particular view via his media empire.

So where does this possible purchase leave us?  The Dow Jones company holds an inordinate amount of influence, which is something I have never been comfortable with.  Yet Dow Jones is the devil I know, and the devil I can to some respect predict.  Rupert Murdoch may not be the kind of man that uses his influence to corrupt the WSJ, the DJIA, and Barron's, but considering the nature of his Fox News organization I can't say that in my heart I believe that to be true.

< I’m a Consumer Whore | BBC White season: 'Rivers of Blood' >
Rupert Murdoch and the Wall Street Journal | 27 comments (27 topical, 0 hidden) | Trackback
I'm hoping DJ says no. by aphrael (4.00 / 1) #1 Tue May 01, 2007 at 12:50:15 PM EST
The idea of Murdoch controlling the WSJ sends shivers through my spine.
If television is a babysitter, the internet is a drunk librarian who won't shut up.
As it does mine by Gedvondur (2.00 / 0) #2 Tue May 01, 2007 at 01:00:44 PM EST
However, further research indicates that it is likely that someone will buy Dow Jones.  Judging by the giant offer that News Corp made for them, there is already speculation about a counter offer from another company, say Goldman Sachs.

To my mind, I would rather that Dow Jones stays independent.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
why? by MillMan (4.00 / 1) #3 Tue May 01, 2007 at 01:04:21 PM EST
They can't get much more pro-corporate short of openly calling for fascism.

When I'm imprisoned as an enemy combatant, will you blog about it?

[ Parent ]
Because by ad hoc (4.00 / 3) #4 Tue May 01, 2007 at 01:11:10 PM EST
outside of the editorial page, WSJ doesn't fabricate news, unlike FOX which does.
--

[ Parent ]
that is true by MillMan (2.00 / 0) #10 Tue May 01, 2007 at 01:43:52 PM EST
I sometimes forget they're the paper the upper class kids read since, well, they have to have some sort of realistic impression of what is going on in the world vs the pure propaganda of every other paper out there.

I'm not sure that it matters much, though, this offer by Murdoch is probably symptomatic of our modern day business leaders deciding that short term profits are worth eating the country for. Only a few capitalists out there (Buffet in particular) are sounding the alarm.

When I'm imprisoned as an enemy combatant, will you blog about it?

[ Parent ]
There is something to be said by ad hoc (2.00 / 0) #15 Tue May 01, 2007 at 02:33:04 PM EST
for IHT, but the articles tend to be short and not very in depth. They are on a fairly even keel, though.
--

[ Parent ]
That and by Gedvondur (2.00 / 0) #5 Tue May 01, 2007 at 01:18:09 PM EST
The amount of influence that the WSJ holds is really hard to fathom.

It can literally make or break companies.  It is so widely read in the business world and so well respected it isn't even funny.

I have to say, that while I don't share the political bent of the WSJ, I do enjoy reading it.  If I could get it in the morning where I live, I would read it every day. 

Sadly, I can't get it here (for home delivery) until the afternoon.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
You can be pro-business and liberal by georgeha (2.00 / 0) #8 Tue May 01, 2007 at 01:35:28 PM EST
Quite a few corporate leaders endorsed Clinton over Dole or Bush, mostly in the tech industry. It would be hard to get much more liberal than my corp.


[ Parent ]
Clinton is/was pro-corporate by MillMan (2.00 / 0) #11 Tue May 01, 2007 at 01:46:44 PM EST
He was a fiscal conservative the sort that Republicans claim to be but haven't been for some time.

When I'm imprisoned as an enemy combatant, will you blog about it?

[ Parent ]
and socially liberal by georgeha (2.00 / 0) #12 Tue May 01, 2007 at 01:52:36 PM EST
not as liberal as Kucinich though.


[ Parent ]
more cops, less welfare, by MillMan (2.00 / 0) #16 Tue May 01, 2007 at 02:35:11 PM EST
cut backs on environmental laws...socially liberal is debatable. Relative to Bush, sure, relative to western European leaders, definitely not.

When I'm imprisoned as an enemy combatant, will you blog about it?

[ Parent ]
Dow Jones by Billy Goat (4.00 / 1) #6 Tue May 01, 2007 at 01:23:52 PM EST
The sort of manipulation you're talking about would be extremely difficult. The Dow Jones Industrial average is little more than the average performance of 30 companies selected by the editorial board of the WSJ, weighted to reflect market capitalisation and price. (It already averages out the price in such a way as to boost performance by giving high-performing stocks greater impact on the overall average - in a sense, it is already "fixed". This is why DJIA numbers are almost always given along with S&P numbers.)

In order to manipulate the DJIA, the company would need to drastically alter the performance of a large number of the 30 component companies. This would be a massive undertaking. Boosting or spiking a single company would be possible (though unlikely given the size and stature of the companies involved), but manipulating 15 or 16 large companies all at once through nothing more drastic than daily articles would be incredibly difficult. And, seeing the sheer scope of the con, would be foolhardy too; especially given that the Dow Jones Wilshire 5000 numbers would be a viable alternative to anybody actually wanting to get a snapshot of state the market.

This isn't to say what you're proposing is impossible - just extremely stupid. When investors could, without much trouble, check the DJIA against several other popular indicators, all Murdock would be doing is threatening the credibility of the DJIA.

Besides, we've already seen what happens when investors get dubious data from the DJIA. In February, heavy trading overwhelmed the DJIA and they suffered critical data delays. Suddenly, the numbers coming out of the DJIA were suspiciously low. What happened? Investors checked against other measures and ignored the DJIA until such time as the DJIA values were re-set.

If Rupert is half the evil genius you'd like him be, then he'd be far too smart for the sort of data wankery you're proposing.

Heh by Gedvondur (4.00 / 1) #7 Tue May 01, 2007 at 01:33:26 PM EST
I think if you had read a little closer I said:

"However, considering the venerable nature of the DJIA and the number of eyes on the companies contained therein, I find that to be an unlikely circumstance to say the least."

So I can say, we are in agreement in regards to the possible manipulation of the DJIA. 

You did go about disproving the idea more throughly than I did.  The idea of manipulating the DJIA wasn't my idea, however I felt a need to touch on it and discount it to some extent.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
We differ about cause. by Billy Goat (4.00 / 1) #9 Tue May 01, 2007 at 01:40:52 PM EST
We agree on the final analysis, but we disagree on why.

I don't trust the "venerable nature" nature of the WSJ any more than I trust the compassion of conservatives or the intelligence of liberals. It is a matter of mathematics and logistics, not will. Even if Rupert bought the WSJ and demanded they spike the average immediately, it couldn't be successfully done in any reliable way. Rupert could breeze in, replace the entire board, and shred the paper's good name. He still couldn't get that scale of manipulation done with enough reliability to make the purchase worth it.

[ Parent ]
WSJ by yankeehack (4.00 / 2) #13 Tue May 01, 2007 at 01:58:53 PM EST
the family which controls the WSJ and associated properties just said no the buyout...

And talking about the sway that the WSJ wields, I was told by the boss of my former company to start reading it since our type of business was covered monthly at least. I did, but only really because I had a subscription a just out of college (there's all sorts of trial subscriptions if you graduate, sit for the LSATs) and I actually missed reading the paper. It is a well written paper - much better than the dailies out there.

Anyway, at my present job, I have a subscription and skim the headlines, in front of my boss every day.  I regularly throw copies of articles to others (the company has a subscription too). Aside from the fact that I'm now off the CC'd "read this interesting article" distribution list by certain unnamed people who want credit for finding things, I now have cred when I point an article out as "really important to read".
"...she dares to indulge in the secret sport. You can't be a MILF with the F, at least in part because the M is predicated upon it."-CBB

You provide by Gedvondur (4.00 / 1) #17 Tue May 01, 2007 at 07:01:49 PM EST
You provide an excellent example of the uses that the WSJ has and how it can be such a strong influence.  I agree with you that it is well written paper that can made a difference at work.  Obviously not as much with some jobs, but still.

As for the Bancrofts, I don't think they will have much of a choice but to sell. The markets will punish the Dow Jones stock hard if they don't take such a huge offer.

I do think it is possible that they will play coy, and try to get other suitors or the price up.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
no surprise by alprazolam (4.00 / 1) #14 Tue May 01, 2007 at 02:12:52 PM EST
i can't stand the WSJ. i hope it disappears, i think it's garbage. does tell the "business" types what they want to hear though. no wonder it's popular.

Well I tell ya what. by Gedvondur (4.00 / 1) #18 Tue May 01, 2007 at 07:06:02 PM EST
I'm a biter.  I'll bite.

Why exactly do you make these statements?  Please tell me what exactly you mean by it being "garbage".

'Cause from here it looks like you are either simply trolling or you are looking for cred with the hacker anti-business crowd.

I don't much care for the conservative nature of the WSJ myself, but I have to respect its integrity and quality of reporting.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
i second this. by aphrael (2.00 / 0) #19 Tue May 01, 2007 at 07:17:13 PM EST
i loathe its editorial page, but its news reporting is top notch.
If television is a babysitter, the internet is a drunk librarian who won't shut up.
[ Parent ]
what i don't like about it by alprazolam (4.00 / 1) #20 Wed May 02, 2007 at 07:01:40 AM EST
i find little about it that is compelling. i can get actual news from the washington post or new york times. like, breaking story news. i can get better, more balanced analysis from the cs monitor. i don't have any interest in the actual "business news", what stocks are splitting or ceos are stepping down...that's all insular circle jerking as far as i'm concerned. i hate the pompous, pro business, bottom line attitude that all that matters is pushing up stock prices and gdps just as much as sports commentators loathe fantasy football.

i also don't give a damn about the "hacker anti business crowd". people's stupid, narrow, self serving agendas are why i spend so much less time reading or watching or listening to news anymore. nobody really gives a damn about the big picture anymore so there's really no reason to believe that anything is going to change. and thus no reason to waste my time and energy hoping it will.

[ Parent ]
Ah, I see by Gedvondur (2.00 / 0) #21 Wed May 02, 2007 at 09:19:48 AM EST
Hate and apathy.  Now that's a reason. A pair even.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
yea by alprazolam (2.00 / 0) #24 Thu May 03, 2007 at 07:17:38 AM EST
god forbid somebody think there's more important things in life than their stock portfolio.

[ Parent ]
Hmmm by Gedvondur (2.00 / 0) #25 Thu May 03, 2007 at 09:19:42 AM EST
I kind of think you are taking a bit too much of a stereotypical view of this subject.  I don't buy or sell stocks, and I have to say that I doubt that yankeehack does either.  Stock market focus isn't the entire reason for the paper.

Yes, they do vile capitalist business reporting.  Yes, they are good at it.

This is just like assuming that because someone reads the Village Voice that you are a smelly granola crunching hippy.  Or if you read the Onion you are a low-brow college student.  I understand your disgust with those that worship at the altar of money, but it doesn't change the fact that the WSJ in its current form is a decent, well written paper.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
how hard is it to by alprazolam (2.00 / 0) #26 Thu May 03, 2007 at 09:30:38 AM EST
report who's the ceo or stock splits or whatever else they report? what actual stories requiring actual investigative journalism have they broken in the past 5 years, that somebody not in the particular industry would care about? did they break any of the enron stories?

[ Parent ]
So tell me by Gedvondur (2.00 / 0) #27 Thu May 03, 2007 at 01:58:34 PM EST
So tell me, when was it exactly that you last read the WSJ?  Their news isn't purely financial.

As to Enron and such, I couldn't say.  I occasionally read the WSJ, but because I can't get it in a timely manner I don't have a subscription.

I am beginning to suspect you speak from very little experience with the WSJ.

Gedvondur
"Well, one of the two girls I'm friendly with out here is a Christian and she wouldn't do the things I want to do." --Sapphire

[ Parent ]
i like the fantasy football comparison. by garlic (2.00 / 0) #22 Wed May 02, 2007 at 12:10:04 PM EST
Rooting for stock price increases is just like rooting for your fantasy football players points instead of paying attention to the actual game.


[ Parent ]
WIPO: Fuck the WSJ by LinDze (4.00 / 1) #23 Wed May 02, 2007 at 03:27:52 PM EST
Ive got The Economist. Ill cede the points about shorter news cycle and more specific business content. However The Economist web site narrows that gap quite a bit with their pre & non print stories.

-Lin Dze
Arbeit Macht Frei
Rupert Murdoch and the Wall Street Journal | 27 comments (27 topical, 0 hidden) | Trackback