By Lynn Ashby 21 Feb. 2011
THE TV – “Automotives were down due to rumors of a merger among GM, Chrysler and Ford. The possible ouster of the CEOs of GE and IBM is OK, analysts say.” I change channels. “Insiders on Wall Street predict that….”
Each time I hear such wise proclamations I think of cold sandwiches and hot coffee. Not that I lost my life’s savings ($45) in the market and had to subsist on such a diet. Actually, I was making more money than I had ever made before, and my power was, well, powerful. I created billionaires and sent losers stepping lightly off window ledges. Global financial networks trembled at my every whimsy. Eat your heart out, MSNBC. If only I had known what I was doing.
At the time, I was the token Texan at The New York Times. For six and a half years, chained to my desk in the city room, I wrote news for the Times’ radio station, WQXR. (It was sold last year and that spot on the dial now speaks Spanish.) WQXR broadcast long-hair music, with brilliantly written, penetrating and sophisticated hourly newscasts. That was me. The job wasn’t so bad. I could have been working in the paper’s Flair & Biased Dept. (we got there first, Fox) or be assigned to the Misquote, Lie & Destroy America beat.
There was only one free-lance job around: writing the nightly business news show, the Wall Street Report. The fellow who had it would wait till the markets closed, check the wires and twist the Times’ business stories, anything to gather info for his script. It paid $75 a week which back then was a king’s ransom for a journalist. Today it’ll get you two pawns and a repossessed castle. However, the scripts had to be written during the supper hour, which meant the writer had to stay at his desk and eat from the passing food cart.
One day I was offered the job, on my own time. I knew what to do, sort of, but it took a while to get the script to the newscasters in time for the show. Picky lot, they were. Each weekday evening I would check the wires, then go to the business department and ask, “What happened on Wall Street?”
Everything was going fine until one night the editor in chief came over and said he had heard my show and wanted to know why a particular stock had fluctuated so much. I told him I didn’t know, which is not what the Chief Enchilada wanted to hear from his paper’s Wall Street Wizard. “Check your sources,” he said, walking away. My sources? I didn’t have any. I didn’t know beans about the stock market and couldn’t spell DJ.
Then I remembered a friend who had just joined a Wall Street firm as a trainee. I called him up. He knew more about the OU football team than the stock market, so he answered, “I don’t know.” Soon he called back and said, authoritatively, “Rumor of a stock split.” I duly passed on this inside info to Mister Big and was saved. This showed me that Wall Street is totally dependent upon unnamed analysts – nameless, faceless druids who explain what happened and why – after it happened. Discovering this, each night I would call up my buddy, Deep Portfolio, in the concrete canyons of lower Manhattan for the inside skinny.
“Gadgets Incorporated is going up because the CEO is in ill health and stockholders can’t wait for him to expire. Buy. Lox Stocks & Barrel is falling due to a secret FBI inquiry. Sell,” he would whisper.
“I didn’t hear about any investigation,” I would reply.
“Again, it’s secret.” I would never identify my sources by name, especially since there was only one. He was variously my “Wall Street insider,” “a source close to the directors,” and, best of all, “a top Wall Street analyst.” Soon we had it down pat.
“Cucumbers are falling due to a cold snap in Florida,” he would say.
“But I just heard cucumber prices were rising rapidly.”
“Of course they are, caused by a warm snap in Florida.”
One sure-fire explanation was incorrect expectations: “The company’s earnings report failed to meet analysts’ expectations.” No, the company was right on target. The analysts were wrong, and I said so. I was absolutely honest. I just didn’t accurately name my source. Besides, I was as correct, and often more so, as the pros. And I wasn’t making any money off my insider tips, except for my weekly $75.
In my imagination, a black limo was speeding toward Greenwich in the evening, with J.J. on the phone, “Wilber, tomorrow unload all our Lox Stocks & Barrel and buy cucumbers. I just heard the Times’ Wall Street show. They’ve got inside info.”
Doing so well, we began predicting future financial developments. “This, according to a mole in Washington: soon Treasury bonds will come in bundles.” “As a top level investor told his mistress, by next month barbed wire will triple.” The emperor’s clothes were looking better, as were those of my editor in chief. No one ever complained, or even questioned my expertise. After all, it was The New York Times, it was news fit to print.
After Mad Money’s Jim Cramer gave some totally wrong stock advice, columnist George Will observed, “There are three truths in life: never eat at a diner called Mom’s, never play cards with a man named Slim, and never take financial advice from someone who screams at you over the TV.” To that last warning I should add: Or from any unnamed analysts, source or “somebody said.”
Today when I hear sage advice from “Wall Street experts,” “economic analysts” and “sources close to the source,” I think of cold sandwiches and hot coffee, and two clueless 25-year-old novices, who didn’t own a single share of stock between them, running the American economy – and doing it rather well.
Ashby is wise at email@example.com