The Doppler Effect
By now, long-time readers know my disdain for rapid-fire stock market noise, but I thought I would elaborate a bit further, if you can bear with me. Personally, there hasn’t been a meaningful stock market program since Wall Street Week with Louis Rukeyser that came to an end when Lou took ill in 2002. Rukeyser was famous for his pun-filled humor and for trying to get investors to ignore the short-term gyrations (i.e. noise) and think “long term”. The program was a legitimate news and investment information television series that was broadcast Fridays on PBS, and I never missed an episode. The show averaged about three million viewers and attained its biggest audience, some six million, in the mid-1980s. With Rukeyser at the helm, the program had a rotating panel of analysts and a special weekly guest, the likes of Sir John Templeton, Charles Schwab, Sandy Weill and Peter Lynch, participating in a discussion on the stock market; the operative word being “discussion”. Rukeyser explained his hosting philosophy as, “I am talking to one person, whom I regard as intelligent, with a good sense of humor, but not all that technically knowledgeable.” He instructed panelists and guests not to use Wall Street jargon and economic theories on the program, but rather talk about making money, because “Economics puts people to sleep. Money wakes them up.” PBS also had a nice run with The Nightly Business Report, but the program underwent a number of ownership changes and is now produced by CNBC. Now the program is basically an encapsulated re-hash of CNBC’s day-time fare. Ratings have declined steadily for NBR over the last few years, and I, too, am no longer the avid viewer I once was. But I believe it deserves the half-hour for one to catch up on the day’s events, so let’s keep it on the right side of the ledger for now.
So what we are left with are the three trading-day players: Bloomberg, Fox and CNBC (all of which simulcast on radio). While CNBC may have the highest ratings of the three, it is clearly the most objectionable. During the day, long-time NYSE floor reporter Bob Pisani and volatile Rick Santelli reporting from the CBOE are the only pair worth listening to. CNBC is a fixture in most financial workplaces, the only positive being that the sound is muted. Fox Business News, in my opinion, is a better choice of the two and has been the recipient of a number of defections from CNBC, including Neil Cavuto, Liz Claman, Melisa Francis and most recently Maria Bartiromo. Lou Dobbs joined Fox in 2010 after a long run at CNN. The Fox troupe is more focused and intellectual than those on CNBC, and let their guests finish a sentence. Bloomberg, however, is the clear winner for daily fodder. Of the three broadcasts, Bloomberg TV, a unit of Bloomberg LP, has the most academic programming and is more focused on news than daily hype. I have it pre-set on my car radio; available on various AM and FM stations nationwide and on SiriusXM channel 119.
From what I have read, the ratings for CNBC and Fox Business tend to follow market volatility. That is when the markets move more viewers tune in. To me, that says volumes about the program content and the audiences they attract. Personally, I avoid these two during the day as the relentless posturing by the anchors and guests are way too emotionally charged. Which leads me to the Doppler Effect: The sound that is made that is higher during the approach, identical at the instant of passing by and lower during the decline. Listen. It is reminiscent of the sound bites on some of these decibel burning channels: Get the viewer’s attention; hold if for a while and then fade away forever without any lasting value. Stock market news shouldn’t be about theater, but rather intelligent dialogue and substantive information. But noise is unfortunately equated with entertainment that hikes ratings, which in turn brings in big profits – for the broadcasters, not necessarily the viewers. My advice, concentrate on news articles from The Wall Street Journal or Barron’s; online through news agencies such as Reuters, Dow Jones and MarketWatch available on the “news” tab of your brokerage account’s website; or directly from online sites such as Bloomberg.com, Google Finance or Yahoo! Finance. Also, check out my “Resources” page under the “Categories” dropdown box. If you need that daily dose of streaming news and stock ticker data, stay with Bloomberg TV. But at all costs, avoid the noise and keep your trading emotions in check.