Thursday, February 16, 2012

Media's effects on the Stock Market.

For my paper I am going to focus in the effects that the media has on the stock market and its outcomes. After being in the industry personally and with Merrill Lynch it is amazing how much the popular and reputable media has on the outcomes of the stock market for the day. There was once a time when the outcome of the stock market was based on basic principles and ideologies. Although with the popular media that we see today this is no longer true. The market is essentially driven by the information that is received over the media wire.
It is a topic that is important to investments because there are traders that trust on investing on the public media. It would be interesting and potentially unique to see how reputable media such as the Wall St Journal, New York Times, and CNBC can drive markets. The importance of this is that most of these publications use online updates that are becoming the sources of information for traders on Wall St to Lasalle St to London to Beijing. The importance of information in the media to traders has stemmed all the way to sources such as twitter and its counterpart tweetdeck. This is a system in which people can create formations of their importances on twitter to receive news as it happens.
This is a topic that serves a purpose to the importance of media. Companies like CNBC rely on there ability to give the news as it happens so that they can be an important asset to Wall St. With a niche like this they are able to find their target market while also serving a purpose to financial markets, which is one of the largest business markets in the United States. I think that this project could serve a purpose in something that is changing the form of financial markets as we know it.


  1. Interesting, do you know which specific media outlet you will look at? maybe it will help to narrow your research question down.

  2. Hey Jimmy,
    Working for the Wall Street Journal this summer I had a particularly unique outlook into the effect that the paper had on the financial industry. There is a very profound affect that the paper can have both in a positive and negative way. As you may well know a lot of the stock market specifically when dealing with hedge funds can be driven by rumors. It was fascinating to see especially the pul that the ad sales department of the paper had on content based on the contracts they had with specific companies. They can sometimes run or hold certain stories that could be beneficial or hurtful to a companies image. Something to think about, especially when you consider that the undoing of Bear Sterns was started by a rumor sparked by financial news outlets.

  3. One great example of media's effect on stock market activity was the fake steve jobs obituary in 2008, Bloomberg accidentally ran a 17-page obituary while steve was battling pancreatic cancer. Although the article was up for less than a minute apple stock plummeted.