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Another Gross Journalistic Failure

UPDATED

NY Times: How Missed Signs Contributed to a Mortgage Meltdown. (T)he cast of characters who missed signals like the rise of delinquencies and foreclosures is becoming easier to identify. They include investment banks happy to sell risky but lucrative mortgage debt to hedge funds hungry for high interest payments, bond rating agencies willing to hope for the best in the housing market and provide sterling credit appraisals to debt issuers, and subprime mortgage brokers addicted to high sales volumes.

The Times fails to add one of the most culpable institutions of all: the press.

Newspapers and broadcasters were raking in billions in advertising from the real estate and banking industries as this bubble inflated. I do not believe this is a coincidence. (Update: I also don’t believe it was deliberate malfeasance; but you just don’t see lots of tough coverage in media of the people and companies paying the bills.)

Oh, sure, there were extremely infrequent stories containing warnings in a few publications — and occasional quotes from skeptics in the prices-just-keep-rising stories that overwhelmingly dominated the coverage. But the reality is that journalists mostly didn’t have a clue, or didn’t want to have a clue. I don’t know which is worse.

Some bloggers did shout warnings. They were ignored, or worse, insulted by wishful thinkers and (I suspect) people who stood to gain from the continuing bubble.

On Thursday, the Wall Street Journal put a story on Page One, entitled, “One Family’s Journey Into a Subprime Trap.” It chronicled the crazy financial stretch a Fullerton, California, family made in “buying” a house with two loans, one for 80 percent of the price and the other for the rest. The loans were interest-only, and now the real bills are coming due. The Journal writes:

The Monteses are caught in a trap — one that hundreds of thousands of people could face as the housing market totters and the easy credit of recent years dries up. They in effect bet that the boom in housing prices would continue. It was more important to hop onto the escalator than to wait until they could afford to make the leap according to traditional measures.

The Journal’s sympathy for this family seems misplaced, in part because these folks were reckless. They had to know they were taking an enormous risk — though I suppose if they were reading the local newspapers and watching TV perhaps they thought the boom had years and years to run. If they relied on the press to tell the truth, in the kind of incessant drumbeat that it needed telling, they were misguided.

Where were the stories we should have been seeing — the warnings that people like the Monteses were running headlong toward a financial cliff? What happened to the coverage of a housing market that fewer and fewer people could afford to enter except with no-interest or no-down-payment loans, where home prices were so far out of sync with the economy that there was no precedent for such imbalance?

Where were the stories pointing out that the secondary (and far beyond) mortgage markets were salting hugely risky debt all through the American economy? You think your bank or pension fund doesn’t have some of this garbage somewhere in its books? Think again.

The media also bungled by not fingering the makers of this bubble apart from foolish “buyers” who proved to be such suckers. This boom was fueled by people who knew it couldn’t last: brokers, bankers and, above all, Wall Street’s ever-clever wizards who risk other people’s money for gigantic fees.

This is another journalistic scandal. It’s not quite on the order of the bended-knee, pre-war coverage — stenography of government officials’ lies and deceptoins — that helped steer America into the Iraq war, but only because it’s not killing people in large numbers.

It’s a massive enough scandal, though. There’s plenty of pain left in this deflation, possibly including an outright tanking of the economy.

You’d never know if from today’s newspapers. They’re full of stories about how the Federal Reserve is stepping up to keep things on an even keel. What it’s actually doing is propping up the Wall Street con artists who helped fuel this thing.

The journalism craft should take a long, hard look at what it’s failed to do, yet again, in the housing bubble. It has failed to warn — as loudly and incessanty as it did in promoting the housing bubble — that a financial crunch was on the way.

There’s plenty of blame to go around in this mess. The finger-pointing has barely begun. But when it gets going for real, I hope that journalists who do some of that pointing will at least look in a mirror.

29 Comments on “Another Gross Journalistic Failure”

  1. #1 Martin Stabe » links for 2007-08-19
    on Aug 19th, 2007 at 5:25 am

    […] Center for Citizen Media: Another Gross Journalistic Failure Dan Gillmor: In a story about how institutions failed to heed signs of the impeding US mortgage crisis, the New York Times “fails to add one of the most culpable institutions of all: the press.” (tags: journalism newspapers usa) […]

  2. #2 Matt Waite
    on Aug 19th, 2007 at 6:55 am

    I can’t defend what other newspapers have done, but I can look at my own. So I did. Maybe your definition of infrequent and mine are different. In 2005, the xenith of the bubble in the Tampa Bay area of Florida, the St. Petersburg Times wrote stories about the bubble, the bursting bubble, the coming price downturn or variations on theme on the following days: Jan 12, Mar 7, May 14, May 25, Jun 11, 12, 22, 23, July 3 and Oct 25. There are undoubtably more — found this list in less than 10 minutes of browsing the free archives. I didn’t even look at stories about mortgages — there were numerous stories about mortgages that mentioned the word “bubble”. I just looked for obvious terms that would appear in stories about how prices weren’t going to keep going up forever. My list is in no way complete. So, in less than 10 minutes, I found stories approaching one a month that said the bubble can/will/might soon burst at a time when there were record home starts and the highest percentage gains in price locally. And, as I said, there are undoubtably more. So, I ask you, what would be sufficient here, since one a month seems to be infrequent to you?

  3. #3 Dan Gillmor
    on Aug 19th, 2007 at 7:18 am

    Matt, I’m glad you were on it. But:

    How long before the bubble reached its most inflated state did the Times start that kind of coverage?

    How hard did the paper press the mortgage industry — especially the people selling no-interest or nothing-down paper, and the appraisers who in many places were happy to just make up a number, etc. — for what it was doing?

    And how hard did the paper look at would-be “homeowners” with the kind of anecdotes that might have been a deterrent.

    Every newspaper has been saying for at least a year now, or even two, that there was something unusual happening in the market. Yours seems to have done more than most. But the kind of relentless coverage that we needed didn’t happen early or strongly enough in almost every, if not every, place where the problem was worst.

  4. #4 Dan Gillmor
    on Aug 19th, 2007 at 7:21 am

    Nice in-migration map you’ve done, by the way:

  5. #5 Howard Owens
    on Aug 19th, 2007 at 7:30 am

    You can’t make people care. There was coverage, but people did not pay attention.

    I got into a bad loan (that I’m not yet out of) in Bakersfield, but it made sense at the time. IT was a chance to buy our first house, and the calculation was I would be there for a long time, and just about the time we expected to refinance, I would be raking it a substantial bonus, so even if the market went south, I would be in good shape. At the time, I had no reason to believe I was taking on much risk.

    But things didn’t work out that way and I’m not yet out of the woods.

    The point is, you could have waived all the articles at me you wanted. You could have MADE me read them. And it wouldn’t have made a difference.

    I bet there are millions of individual stories like mine — consumers who found creative justifications for signing up for risky loans. The risk was in plain sight, and they did it anyway.

    This isn’t a story of “evil big business” vs. clueless consumers. For every bad loan, there is a consumer who agreed to it. It’s a two way street.

    And who knows how many people benefited from easy credit — who are now in homes they couldn’t have gotten otherwise and are in no danger of losing it. They’re golden.

    And the boom created a lot of jobs and a lot of wealth for a lot of people.

    And it helped prop up a lot of newspaper operations during a time when we were getting hammered on other financial fronts. There are thousands of journalists employed today who may not be employed otherwise.

    Like anything in economics, it’s all dynamic and multilayered, costs and benefits that are exceptionally complex.

  6. #6 Howard Owens
    on Aug 19th, 2007 at 7:31 am

    BTW: I really need the Fed to lower interest rates … if I’m going to sell my place in Bakersfield in three months, I need a little appreciation and the person who is planning on buying it needs to be able to easily get a loan. Come on Fed …

  7. #7 Matt Waite
    on Aug 19th, 2007 at 10:02 am

    I can make a valiant, if probably doomed, defense on your first question: I found three stories — June 9, Aug. 25 and Oct 11 — in 2002 raising the bubble question on prices and appreciations that seem quaint in retrospect. Not exactly banging the drum. But at least they’re there.

    Now, the long winded part: I don’t think I need to look to answer your next questions, and they boil down to not enough. It’s natural to ask what role the mass media plays in most everything in modern life. But I think what’s going on here is more of a systemic failure than an abdication of responsibility. I would have *loved* to know how people were paying for their houses in 2004 when I developed and anchored the kind of gee-whiz-look-at-these-prices story you mention. Real estate is a local story — there is no national real estate market, just hundreds of local markets all lumped together to create a national picture. I can get all kinds of very local home sales data (see here and here). What I can’t get is equivalent data on mortgages. Well, that’s not exactly true. I can get very local mortgage data from the Home Mortgage Disclosure Act from the Federal Reserve. However, by the time it’s released, you’re looking at data that’s more than a year old. And it’s not very detailed when it comes to how the mortgage is put together.

    So, without up-to-date local data, that means local/regional papers aren’t going to write stories over and over and over again, because there’s only so much you can do with a state or regional summary. That leaves it to bigger papers who cover Wall Street, the people who would be looking at future trends in business and have access to people who are paid to worry about those kinds of things. And, if you’ve been following the news lately, the problems that have spooked the market are largely because hedge funds that had been buying all these bad mortgages until recently are panicking because they don’t know what they have and how much it’s worth. With no one to buy the paper, there’s no new mortgage money, which creates a credit crunch, etc. etc. etc. But who exactly was covering the commercial paper market prior to this past month? It wasn’t the St. Petersburg Times, or the vast majority of local/regional papers in the country. They don’t have — nor ever had — the resources to do that.

    What would have facilitated the writing of the stories you describe here is better, more recent, more detailed, very local mortgage data. I hope one of the fallouts from this is just that — greater transparency in the mortgage industry.

    Another question is how are these anecdotes now coming to the fore? When the boom was in mid stride, the people who were taking out these insane loans were doing just fine — values rising, interests rates low. As a reporter, to write the story you’re looking for, you’re left hunting for people who would be willing to admit in the newspaper that they took out a risky loan and it could collapse on them. Would you tell a newspaper reporter that? And how often would an editor want a story that said “A problem that isn’t happening now could happen sometime in the indetermined future and really hurt people.” Once a year? Twice? And the subtext of that story in 2005 is here are people who couldn’t afford a house who are in one now and it hasn’t hurt them yet, but it might, maybe, sometime in the future, if things change, and there are plenty of people who disagree on when that might be.

    The reason the anecdotes are so awful now — the very reason they are an object lesson in why I love my 30 year fixed mortgage — is that all you need to do to find them is go down to the bankruptcy court or over to the court clerk’s office and start paging through bankruptcies and foreclosure notices. In 2005, few were declaring bankruptcy and foreclosures were hostorically low. Now, you can’t swing your arms without finding someone in deep financial trouble because of a 5 year ARM coming due in the middle of a tanking real estate market. If that drama had been there in 2005, you’d have seen those stories.

    So, chicken or egg? Story, or the raw materials for the story? Which comes first?

  8. #8 Dan Gillmor
    on Aug 19th, 2007 at 10:36 am

    Howard, I absolutely agree that the borrowers share the responsibility for this — especially people (I assume NOT including you) who were lying through their teeth, sometimes with the connivance of the lenders, on loan applications.

    The same mania hit in the stock bubble, when people started believing (again with cheerleading from the media) that stocks could only go up.

    But the major enablers of this mess were the people who a) did the lending (and appraising); b) the secondary (and beyond) financial players whose job was essentially to shift the risk to someone else. They all did this for fees — for short-term gain at other people’s long-term expense. Actually, not so long-term now, is it?

    Matt, props to you on the 2002 coverage. That’s good work. And I suspect we agree more than not on the rest of it, especially better data from the lending industry.

    But I disagree that this is just the way journalism works, more than an unavoidable systemic failure. Getting this right did demand the kind of hard work that journalism organizations sometimes tackle. But the crisis was utterly predictable, because what was happening was unsustainable by any standard. The lack of current data, while a problem, has never stopped reporters from getting other such stories — when they wanted to get them.

    The drama of a 5-year ARM coming due during a crunch was *implicit* in the 2005 stories about how the market (at least in California) was shifting into “liars loans” (little or no proof of income required); no-interest and no-down-payment deals. It was trivially easy to see the drama that would ensue once the market went soft, which it was absolutely going to do at some point barring a sudden discovery that the law of supply and demand had been repealed, which at last glance has not occurred.

    A newspaper didn’t have to get “people who were taking out these insane loans” to admit it; all a paper had to do was look at previous bubbles and the clear consequences of this one, and show the borrowers’ recklessness without their acknowledgment. A newspaper that does its job has enough credibility to explain reality. Its readers deserve it.

    So yes, given the predictability and magnitude of this mess, I do think that media organizations should have been harping on it. Home “ownership” — I keep putting that word in quotes because of the absurdity that someone can own something with no money down and solely based on the assumption that prices will rise fast for the forseeable future — is such a big a part of America’s economy, and psyche.

    The press failed us, in its usual way, by being almost purely reactive despite substantial evidence of trouble before the shit hit the fan. It’s nothing new: S&L debacle, Iraq war, Enron, the tech bubble, etc. etc. etc. And when the consequences of our other debts — budget, trade, Medicare and more — start to hit, the same too-late finger pointing will start anew. Finding villains in retrospect is a poor substitute for helping, and if need be doing our best to force, people wake up to reality ahead if time.

  9. #9 Seth Finkelstein
    on Aug 19th, 2007 at 10:51 am

    Dan, the issue is very basic:

    GOING WITH THE CROWD GETS REWARDED
    GOING AGAINST THE CROWD GETS PUNISHED

    The problem is nothing is being done to fix it, and the blogging system makes this problem worse. But recursively, people get punished for pointing this out, because it’s going against the (blog) crowd, while they get rewarded for hype from the (blog) crowd.

  10. #10 Dan Gillmor
    on Aug 19th, 2007 at 11:06 am

    But going against the crowd also brings rewards. Consider Bethany McLean, who in 2001 (also late but way ahead of her peers) asked if Enron was “overpriced” — a kind word for what was the actual situation but based on actual journalism that others didn’t bother to do. She’s been celebrated since then.

    I’d like to see a prize in journalism — open to traditional and new journalists alike — that rewards people who went against the crowd and were right about big things like this.

  11. #11 Jon Garfunkel
    on Aug 19th, 2007 at 11:36 am

    Dan– I did a search on the NYT between January 1, 2000 and January, 1 2005. I got 62 results.

    The first one from that seach is March 15, 2000 is a 6,145-word article, billed as the first-ever collaboration between the Times and ABC’s 20/20, MORTGAGED LIVES: A special report.; Profiting From Fine Print With Wall Street’s Help, by Diane Henriques and Lowell Bergman:

    “The money raised by Wall Street for First Alliance and dozens of similar companies has financed a quiet revolution in the financial habits of millions of Americans whose low incomes or blemished credit histories otherwise prevented them from obtaining conventional loans. Such subprime borrowers, as they are called in the lending industry, have turned in increasing numbers to finance companies that cover the risk of default by charging them significantly higher fees and interest rates.”

  12. #12 Dan Gillmor
    on Aug 19th, 2007 at 11:44 am

    I didn’t say there were no stories. But the occasional (and deep) pieces like this don’t come close to the overwhelming and general cheerleading we’ve seen for the housing bubble. That’s my main point.

  13. #13 Seth Finkelstein
    on Aug 19th, 2007 at 11:45 am

    Dan, are you seriously going to argue that those are comparable in effect?

    Someday I’ve got to figure out the way to deal with this rhetorically:
    “People who play the lottery lose money” (a near absolute truth, but has a few tiny exceptions which are tedious to note)
    Lottery-evangelist: “But look, this person played the lottery and WON. Thus you’re wrong., people CAN make money playing the lottery!” (misleading conversational confusion of a rare possibilty with the overwhelming majority of cases).

    Oh, by the time people win the prize, the enemies are made, the damage is done (sigh – usually, in the vast majority of cases, there are always exceptions).

    The problem is systematic, for day-to-day interaction. Jackpots don’t change this problem.

  14. #14 Dan Gillmor
    on Aug 19th, 2007 at 12:59 pm

    Seth, no, I’m not at all arguing that the effect is equal. (Quite the opposite.) I’m just wishing, forlornly, that journalists would not cut against the grain just to be contrary, but to cut against the grain when it’s obvious that the truth is not being grasped by the public.

    And don’t get me started on the lottery and coverage thereof — a poster child for ongoing journalistic malpractice.

  15. #15 Jon Garfunkel
    on Aug 19th, 2007 at 1:04 pm

    Dan–

    Regarding your earlier comment:
    “But the reality is that journalists mostly didn’t have a clue, or didn’t want to have a clue. I don’t know which is worse”.

    Is that really the case? It’s also possible that the financial reporters are at a different desk then the real estate reporters.

    Should the Food section always bring to mind the intricately related issues of health and U.S. agriculture subsidies? Should the travel section mention the relative low price Americans still pay for fuel (which may be offset by the weak dollar…). I guess its assumed that the newspaper reader ought to
    I suppose it’s a germane question worth asking as to whether these stories ran in the business section or in the real estate section.

    As for those cheerleading stories.
    Consider Teri Karush Rogers’s story today in the Real Estate section (online, it didn’t get to New England edition): “Manhattan’s Real Estate Slump That Wasn’t.” Prices go up, examples are needed, and that’s your news.

    In this context, I’m wondering how it’s possible to report that prices are rising *without* it appearing as a bubble story.

  16. #16 Dan Gillmor
    on Aug 19th, 2007 at 3:49 pm

    Rising prices for a commodity that a smaller and smaller percentage of people can afford are, by definition, not sustainable. (It’s possible that Manhattan will rise forever, but I’ll bet you dinner at Legal Seafoods that there’ll be a crunch there one of these days, too.) Your analogies don’t work for me, because this isn’t about food or fuel, but about the single biggest financial move most people make in their lives.

    I agree it’s germane where the stories ran, btw.

  17. #17 Howard Owens
    on Aug 19th, 2007 at 6:19 pm

    Dan, as a matter of clarification — I DID NOT borrow using “stated income,” as I believe has been the practice of some, if that’s what you refer to as “lying through their teeth.” But I did have no money down, owing to being a lowly newsroom employee for most of my career up to that point.

  18. #18 Derek Willis
    on Aug 19th, 2007 at 6:28 pm

    Dan,

    A quick search of Washington Post stories turned up these, among others:

    Nov. 9, 2002, first page of Business section: “Stuck Under a Load of Debt; Unable to Meet Payments, Hard-Luck Consumers Spread the Pain to Lenders,” by Caroline Mayer (not available online, unfortunately).

    Feb. 27, 2005, op-ed page: “Bye-Bye, Housing Boom,” by Michael Kinsley
    http://www.washingtonpost.com/wp-dyn/articles/A54743-2005Feb25.html

    April 17, 2005, Page A1: “In Real Estate Fever, More Signs of Sickness,” by Daniela Deane. http://www.washingtonpost.com/wp-dyn/articles/A59515-2005Apr16.html

    May 17, 2005, Page A1: “U.S. Warns Lenders To Elevate Standards,” by Kirstin Downey.
    http://www.washingtonpost.com/wp-dyn/content/article/2005/05/16/AR2005051601555.html

    Nov. 11, 2005, Page A1: “Housing Market Cooling, Data Say,” by Kirstin Downey and Sandra Fleishman. http://www.washingtonpost.com/wp-dyn/content/article/2005/11/10/AR2005111002241.html

    Now, were there other pieces or letters to the editor quoting real estate agents and home builders saying there was no bubble in sight? Yes, there were. But to say that no critical coverage existed is, well, wrong. I think your argument would be better served if you supplied numbers to back up your assertion that critical stories were “infrequent”, or even told your readers which media outlets you were referring to (since you said later that location is germane).

    Another possible factor here, which is not an excuse but might offer a somewhat less sinister reason than journalists seeking to profit personally is that a number of reporters, especially at smaller papers, might not have ever purchased a home or did so only recently (I count myself in that latter group, btw).

    As to your assertion that by reading today’s newspapers, you’d “never know” that the housing market might have some pain for a lot of folks, I offer today’s Washington Post, which has a story by Michael Rosenwald about the townhouse he and his wife purchased in 2005 with an interest-only mortgage loan (http://www.washingtonpost.com/wp-dyn/content/article/2007/08/18/AR2007081800089.html), and on the question of whether it was a mistake to using that particular finance option.

    Derek Willis

  19. #19 Dan Gillmor
    on Aug 19th, 2007 at 8:44 pm

    Again, I didn’t say there were *no* stories. I said the few critical ones were greatly outnumbered by the cheerleading. If you’re citing the Post as an example of adequate coverage, I’ll have to disagree. A few stories doesn’t begin to cut it.

    And the piece in today’s Post is a classic example of getting it way too late.

  20. #20 steve baker
    on Aug 20th, 2007 at 7:11 am

    Dan, Didn’t you have a strong feeling that we were in a real estate bubble? I did. I was sick of reading the stories about the pending catastrophes in Southern California and Florida, the ludicrous no-money down mortgages. Paul Krugman wrote about this in the Times about once every three weeks. I didn’t feel misserved by the press on this one. The only thing they didn’t tell me was when.

  21. #21 Derek Willis
    on Aug 20th, 2007 at 7:28 am

    Dan,

    I cited a few stories because I was able to find them in a few minutes of searching, not as an exhaustive accounting of all of the reporting the Post did. As it stands, though, it’s a greater body of evidence than you have so far supplied to back your assertions (stated and implied) that journalists either knowingly or ignorantly boosted the housing market and may have done so for their own benefit. I’d like to see some evidence of this – if you have specific reporters or papers who engaged in those tactics, I think we’d all be the better for knowing who they are.

    Derek

  22. #22 Tom Stites
    on Aug 20th, 2007 at 8:11 am

    To my mind, counting stories about housing prices and subprime mortgages in this paper or that doesn’t address Dan’s point: The fact is, the general public was caught unaware by the financial crisis we’re experiencing. If we had ideal news organizations, the general public wouldn’t have been caught unaware.

    My experience as a news consumer was no shortage of housing bubble stories but almost nothing on CDOs, or collareralized debt obligations — the funny money bond-like instruments issued by bank-like institutions that aren’t banks and thus aren’t regulated. What I read about hedge funds was awe-struck stories how many tons of millions their operators were making, not about how they made the tons of millions in ways that undermined the financial structure.

    With the exception of Paul Krugman’s op-ed column in The Times, I saw almost nothing that even began to poke at such stories. Granted, the hedge funds and Wall Street financial wizards work hard at being opaque. But for ideal news organizations, the more veiled the secrets the greater the reason to do the hard reporting that will pull back the curtain and expose the secrets to the light and air.

    Right now the inherent flimsiness of CDOs has cracked them open to the light and air. Wouldn’t it have been better if reporters had cracked them open a long time ago?

    In his op-ed column about energy efficiency and global warming in today’s Times, Nick Kristoff crystalizes the weakness in business as usual in our news organizations : “I can’t help feeling that we in the news media are part of the reason that steps to battle climate change aren’t on top of the national agenda. We’re good at covering things that happen on any one day — like a tornado or hurricane — but weak at covering complex trends, like climate change.”

    Same with financial ecology.

  23. #23 Dan Gillmor
    on Aug 20th, 2007 at 9:14 am

    Good points, Tom. The bubble couldn’t have occurred without the CDO funny money.

    One of the newsweeklies had a story last week — last week — blaming Wall Street for the bubble and explaining a lot of this. As you say, now they tell us.

    They also quoted a woman who discovered that the paperwork for her mortgage listed her income at double the actual amount. I am skeptical that she didn’t know. Extremely skeptical. Yet there’s not a hint in the story that she might have been in on the arrangement…

  24. #24 Dan Gillmor
    on Aug 20th, 2007 at 12:11 pm

    Steve, the major uh-oh coverage didn’t really get going until about a year ago — far, far too late to make much difference.

    Again, I’m not saying this is solely the media’s fault. Lord knows the regulators basically ignored this until way, way, way too late. But if journalists had piled onto the story early, we might be in less trouble than we are today.

  25. #25 Chris Edwards
    on Aug 20th, 2007 at 3:39 pm

    I am based outside of the US: yet in every conversation about the future of the general economy that I have had over the last two-three years has been centred on the US housing bubble. I certainly didn’t get that from blogs and nor did the people I talked to – this was something discussed very much in traditional media.

    You could argue that the discussion was in the business pages versus the property pages, but it was there. And, in fact, in all of this discussion, the one person who has not presented evidence to back up your position it is yourself. You declare that there is a mismatch, yet I have seen no quantifiable justification for your position only your opinion that “the press didn’t do enough”. Basic searches on news sources reveal hundreds of references to phrases like “housing bubble”. Where is your evidence that warnings weren’t there?

    Furthermore, where is your evidence that journalists on newspapers etc suppressed concerns about the housing bubble because they wanted the property advertising? Those are big accusations. Do you have proof?

  26. #26 Dan Gillmor
    on Aug 20th, 2007 at 4:29 pm

    Many if not most papers have special weekly real estate pages or sections where you would find little hint of the potential for trouble. I know I looked for it in the papers I read. That’s where the discussion belonged, not in the occasional business page stories. Hundreds of references to bubbles, most in the past year and not when there was a chance to slow down that train, were dwarfed by comparison to the buying advice that dominated coverage of real estate overall. And I didn’t say there was deliberate suppression of the news, just the natural way the business operates.

  27. #27 Chris Edwards
    on Aug 21st, 2007 at 6:14 am

    From a comment left on a bubble blog – http://thehousingbubble.blogspot.com/2005/05/buyers-builders-lenders-may-get-burned.html – in Spring 2005:

    “There was also a piece on ABC Evening News last night about the housing boom )

    And on NBC, CBS, PBS, CNBC, the NYTimes, WSJ, LATimes, every newspaper, every magazine, etc.

    Yet last week’s Gallup Poll shows that 77% of Americans had never heard of “the housing bubble”. That’s not 3 out of 4 who disagree that there is a housing bubble, but 3 out of 4 who have never heard a peep about housing prices getting a wee bit frisky.

    Jeebus H. Kee-riced!

    Are 3 out of 4 people illiterate or simply don’t read or watch the news? Now we know why the ratings for American Idol and Desperate Housewives are so high.”

    I guess now you’re going to ask why didn’t those journalists go round in person and slap every homeowner round the face with a wet haddock and scream: “Wake up dumbass, there’s a bubble!” Or that the commenter dreamt up all those headlines from, erm, more than two years ago.

  28. #28 Tuesday links 21 August 2007 : Real Central VA
    on Aug 21st, 2007 at 11:43 am

    […] How the media missed the signs of the mortgage meltdown […]

  29. #29 Center for Citizen Media: Blog » Blog Archive » Financial Meltdown: Journalists Ignored the Early and Obvious Signs
    on Sep 17th, 2008 at 3:49 pm

    […] postings on this topic are here, […]