Time pressure takes the edge off financial journalism

Arno Juutilainen, a journalist in Hämeen Sanomat pointedly says that Finnish financial journalism has not succeeded in reading the complex phenomena of the economy. His list contains a large number of what was missed in these past years.

The loss of industry to low wage countries, the shifting of economic focus to Asia, the vulnerability of the financial markets or the debt burden that nibbled at the economic foundation of the west were subjects which were noticed much too late.

“Financial journalism failed in evaluation of economic development in the aftermath of the bursting of the IT bubble. Several trends were detected in the global economy and national economic development which only pointed to nothing but catastrophe as the final outcome”.

The problems were mentioned in the passing but for instance, the imbalances of trade and finance between China, the EU countries and the United States should have been warned with more screaming letters early enough. Complaining after the event is part of Finnish political and financial journalism, Juutilainen lashes out.

The ingredients of catastrophe on the other hand remained unnoticed by economists and political decision-makers. According to Juutilainen, the media have too much trust in “economics experts”.

“They however, only explain views that are positive from the perspective of the groups they represent. Financial issues are dealt with in small bits and on a short-term basis separated from actual happening and trends.

The views of Jan Hurri, a journalist in financial newspaper Taloussanomat on financial journalism, are less gloomy. In his opinion, financial journalists in different media have generally done a good job during the financial and economic crises.

“Not everyone has performed satisfactorily or exceptionally good but nevertheless good. The overall perception of the crisis has been left leaning too much on “official sources”. Alternative viewpoints and interpretation have had needlessly little emphasis”.

An example, in his opinion is the financial crisis of the euro-zone countries. Of course the utterances of the European Union, the European Central Bank and state officials should be reported but they should not always be taken at face value.

Jorma Pöysä, journalist in financial newspaper, Kauppalehti remarks that it is impossible to squeeze financial journalism into one model.

Alongside financial newspapers and the financial pages of mainstream newspapers, financial news is also visible in the domestic and political news pages of mainstream newspapers and in the electronic media.

“There are also stories dealing with macroeconomics – issues on the overall economy and microeconomics, i.e., those dealing with individual firms. Financial journalism is a little like an amoeba”.

According to Pöysä, the problems of financial journalism are not different from mainstream journalism.

“Stories and headlines are getting shorter and photographs are getting larger. The dependence can sometimes get immoral or otherwise twisted characteristics. Stories are also at times written in a way as if readers were idiots to whom everything has to be explained in an oversimplified way”.

According to Juutilainen, the poor level of financial journalism cannot be blamed on time pressure or lack of resources. To him, the issues have to do with distribution of tasks in the editorial offices.

“The weakness of financial is influenced by general indifference and lack of commitment, which is fed by lack of rigorous thinking and the short-sightedness of employers”.

The publication by the research unit of journalism in Tampere University, entitled “Everything is so far going well”, criticized financial journalists, among others that there was no quick connection of the global financial crises to the Finnish situation.

A similar disconnect was also between the financial and the real economy– or at least in the mainstream media reports the connection was not sufficiently highlighted

In spite of their critique of Finnish financial journalism, Anna Simola and Esa Reunanen, who compiled the research, nevertheless give some praise.

“Almost every essential thing is found in financial news. But there is lack of deeper analysis and diverse material from the news and information repeated daily”.

“Economic phenomena are so complex and multi-dimensional that they are extremely difficult to simplify. Given the difficult nature of the task, I consider financial journalism as having succeeded”, says Reunanen.

The researchers however, complain that stories providing background easily get hidden behind daily stock market journalism.

“Let’s go by short time frame and let’s repeat the daily briefings of economists and public relations officers of companies. In this situation the memory of financial journalism gets switched off or functions badly. What was said last week is no longer remembered”.

“In journalism there is a basic problem that clichés and basic interpretation are created out of certain phenomena which then get repeated from one story to the other. Hardly does one find innovative and more ingenious explanation”, Reunanen adds.

Reunanen would like to find more discussion and debate about macroeconomics in the news.

A typical news report consists of what has taken place at the end international conferences and the comments of our finance ministers. There should be more courageous speculations, critique and dissenting opinions”.

According to Reunanen, forecasting is not the job of journalism.

“That is why it is unreasonable to blame the journalists’ community for the unanticipated nature of the financial crisis and the recession. The turns of economic cycles are often real surprises. It wasn’t a surprise that for instance, that American and also many Europeans had too much debt. Instead no one could predict the so-called last stone that would set off the mudslide and when an accident happens”.

Hurri is known for his stories dealing with the stock market and macroeconomics which complicated issues are presented to readers in a readily understandable form. He himself admits that due to the difficulties in perceiving cyclical trends, there is a need to constantly improve on one’s expertise.

“I have learnt for myself that observing this crisis has thought me that independent and preferably critical sources are of utmost importance”.

The other lesson is that we have still got a lot to learn about the mechanism and operations of the global economy.

“At times I have stopped to wonder whether it is after all essential to provide in-depth explanation of the functions of certain financial instruments. Would it be more relevant to realize their purpose and significance with the topic under discussion?”

According to Pöysä, the fact that there is now lean staffing in economic sectors of newspapers was graphically illustrated when last year Helsingin Sanomat sent large numbers of experienced journalists into retirement at one instance.

“There are still good stories but the shortcomings are clearly noticeable to the eye. I have a feeling that publishers are trying to experiment on how much to dilute wine and still sell it at full price”, Pöysä reflects.

Pöysä is however, not worried even if the generation of journalists who have experienced all economic cycles disappears from newspapers in the near future.

“The current generation of financial journalists is much more competent than we were 20 years ago. Sharp, young people, and brilliant texts when I think for instance, Kauppalehti’s summer journalists”.

On the other hand the world is more demanding, not only the dominance of new electronic news channels but also in relation to content, remarks Pöysä.

“Some time ago we lived in a closed economy. Globalization was spoken and written about with the eyes rolling”.

According to Pöysä, the biggest setback of Finnish financial journalism is limited resources. Finland is a small country, and with it resources.

“There is a feeling of serious insufficiency when one reads The Economist and the Financial Times, and sees how they are able to provide their readers with filling material”.

“Except that these media could also not well predict the financial crisis either”, says Pöysä.

Translated and edited by Linus Atarah

Original story: http://www.journalistiliitto.fi/journalisti/lehti/2011/04/artikkelit/kiire-vei-teran-talousjournalism/