January 16, 2018 03:11 pm CST
You Can't Trust Media
By Briton Ryle, Wealth Daily

As you know, I live in Baltimore. It's been a challenge to keep the recent protests in perspective. I've seen firsthand how the media blitz has blown things out of proportion.

The worst came on Monday, when Fox News nearly set off another round of mayhem with inaccurate reporting. A reporter — Mike Tobin — said on air he saw a Baltimore police officer shoot a fleeing man in the back.

"Oh no," I thought when I heard that account as it spread across various media channels. "Now the hooligans have the excuse they need to renew their assault on the city."

Only the reporter was wrong. The cops didn't shoot anybody. Yes, an armed man did run from the cops. And his own gun fell and discharged when it hit the ground.

The Baltimore police didn't fire a shot.

In fact, the Baltimore police showed an amazing amount of restraint during the one night of riots we suffered through. Nobody was killed. No video of police beating a teenage rioter emerged that I have seen. I have not found any reports that police shot anyone, though 19 people have been gunshot victims over the last nine days.

The police's restraint was probably the single biggest reason things didn't get worse here in Baltimore.

And one reporter nearly set off the powder keg in his rush to break the story of a police shooting.

What the heck has happened to journalistic standards?

There were plenty of police available — he could've gotten the story confirmed. But he didn't.

Instead, he went live on TV saying this [emphasis mine]:

Well, about 2:45, we saw a guy running from the cops, here right at the intersection of North and Pennsylvania, where the uh, you know, which has been the epicenter of the unrest here. And as he was running away, that officer drew his weapon and fired and struck the individual who was running away. He was a young black male, and what we saw on the sidewalk as the crime scene unfolded there, there was a revolver laying on the ground. It looked like a six-shooter revolver with a long barrel. The individual who was shot — again a young black male — he was alive. They just took him off in the ambulance, but he did not look to be in good shape at all. I can’t really give you an accurate diagnosis and I could not get a look at his wound but he looked to be in bad shape.

The reporter said the officer "drew his weapon and fired."

But again, that's not what happened.

The Baltimore police quickly issued a statement that no police officer fired a shot and, in fact, that no one was shot at all, not even when the suspect's gun went off accidentally.

To Fox News' credit, the story of the shooting was quickly corrected.

Still, that doesn't change the fact that journalistic standards are a joke these days. We've already seen NBC anchor Brian Williams fall from grace for lying about being shot down in Iraq. And Bill O'Reilly has been taken down a peg for exaggerating his involvement in the Falkland Islands.

Shoddy reporting has become an epidemic in America.

I suppose in the Facebook/Twitter era, the news comes so fast there's no time to check the facts. Many "news" sites post articles in the blink of an eye, with sensationalist headlines and very little substance.

Never mind that unsubstantiated reports, like Fox News on the police-shooting-that-wasn't, could have easily reignited the anger and led to more riots. Maybe that time someone would have lost their life. 

How much is bad reporting costing us?

As an investor, I see bad headlines and news stories every day. How many Americans have been scared to invest in stocks over the last few years because fear-mongers like Peter Schiff, Marc Faber, and Nouriel Roubini relentlessly say a new financial crisis is right around the corner?

Stock prices move up and/or down every day. Sometimes there's a good reason for it, sometimes not so much. But watch CNBC or monitor Yahoo! Finance. They'll roll out the bears when stocks are in the red, and you'll hear nothing but bullish commentary when stocks are rallying.

There's a reason for this. The CNBCs and Yahoo! Finances of the world exist to sell ads and get clicks and make money. Helping you navigate the sometimes-complicated world of finance is a secondary goal at best.

And just like the Fox reporter who chose not to fact-check a potentially dangerous story, the financial media often does the exact same thing, with little concern for the consequences. 

Like this headline from yesterday: "Investors flee US stocks at financial-crisis levels"

Holy cow! Really? People selling stocks like they did during the financial crisis conjures up those 500-point waterfall declines that scared the bejeezus out of us all. Surely it's time to sell everything...

Read the article, and you get a different story. U.S. stock mutual funds and ETFs saw $35 billion in net outflows during April. That's the most since October 2008, shortly after Lehman Brothers went bankrupt. 

$35 billion sounds like a lot of loot. And it is. But the total value of all listed U.S. stocks is over $20 trillion. Yeah, that's trillion with a "t." $35 billion is literally a drop in the valuation bucket.

Now, I don't want to minimize these numbers. It's never a good sign when you have money coming out of stocks. It's not a harbinger of disaster, either. After a net loss in March, the S&P 500 finished higher in April.

Why did people sell in April? I don't know. Maybe they were raising cash to pay taxes. Maybe some investors needed a down payment for a house. People sell stocks for all kinds of reasons, and it doesn't mean the financial crisis is back.

Now, more than ever, we investors have to be able to think independently about the stock market and our investments. We have to always ask the question: "What does this mean?"

Because the media isn't going to give us any real answers.

Until next time,

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Briton Ryle

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