As we all face the biggest economic challenge in the USA and the World since the Great Depression, I find the impact the 24-hour news networks have to be devastatingly negative. Because they need to fill 24 hours of every day with “newsworthy” programming, they continually try to make mountains out of the tiniest mole hills they might find. Last night as I watched the news, it struck me: How would we all feel about the financial downturn if we didn’t have a magnifying glass on it from the media 24/7? Would we be more fearful? Would we be less fearful?
I can’t help thinking that businesses in America are suffering because of the media. If we all hadn’t been afraid of a possible recession — a fear I do believe was exacerbated by the media in August and September of this year — we might not have lost consumer confidence quite as early as we did. In August and September confidence was down but there were not a lot of job losses yet. But then, in October companies did worse because consumers were afraid to buy, and some companies started laying off employees. Now we have people who really can’t buy because they don’t have jobs. Consequently, less money comes into the marketplace. And the more people choose not to buy, the more jobs are lost, etc.
And no, I am not saying the news media caused the downturn. Obviously, there are some things in our economic position that are not right and have been messed up (particularly during the last 8 years of terrible leadership in this country). The foreclosed and high-risk mortgages out there really are bad — and they need to be dealt with. People in America do need to stop spending more than they earn and understand a better balance. Credit should be a little bit harder to acquire (though not as hard as it is now…). We should not have a population that has a NEGATIVE savings rate, as it has for the last few years. This seems obvious – but somehow Americans were unclear on the concept of money in and money out. So please, people, I am NOT saying that the news media caused the problem. BUT… did they make it worse?
I welcome any thoughts on this subject.