In my recent post on mutual funds, I noted that John Bogle disrupted that industry with Vanguard, a mutual fund company that specialized in low cost index funds designed to mimic rather than outperform major market indexes. The other mutual fund companies responded with their own index funds, and there is intense competition between them
Mutual fund shares vs. ETFs
Exchange Traded Funds, ETFs, are another refinement of the fund category. They will certainly figure into your reporting on the fund asset class because they are by some measures the most popular of all exchange traded securities.
In a previous post about indexes, I identified the Dow Jones Industrial Average and the Standard and Poor’s 500 as the two most frequently referenced. They originated as short-cuts that summarized market trends, and are often used as a benchmark against which investment performance can be judged.
There has been an explosion in the number of indexes in recent years. There are hundreds if not thousands available, enough to slice and dice the markets in as many ways as can be imaged. Some are broad-based, like the NASDAQ Composite with more than 3,000 stocks. Others might track a region, like the EURO STOXX 50, based on 50 large companies in the Eurozone. Some follow companies of a certain size, like the Wilshire US Small Cap. And still others focus on an industry, such as the NYSE Arca (originally AMEX) Semiconductor Index.
Numbers are funny things. Even though they appear to be absolute, a clever manipulator can twist them to make pretty much any point he wants to make. Take President Trump’s statement from February: “Ninety-four million Americans are out of the labor force.” It might seem preposterous but it is correct, as the great sage Obi-Wan-Kenobi once said, “from a certain point of view.”
It is the number you get if you take the total U.S. population 16-years of age and older and subtract the people the BLS says are in the labor force. That number includes everyone who is retired, and most high-school, college, graduate or vocational school student. It also includes the disabled, homemakers, some self-employed and those living off their investments.
The Bureau of Labor Statistics released its Employment Situation Report for February on March 10, showing a healthy 235,000 gain in payroll employment. Asked what President Trump thought about the numbers, White House press secretary Sean Spicer said, “I talked to the president prior to this, and he said to quote him very clearly,” Spicer said. “They may have been phony in the past, but it’s very real now.”
Many of the reporters present laughed. I cringed.
Over the years on public television’s Nightly Business Report, I filed countless “numbers” pieces. The monthly employment reports were most closely watched. For better or worse these reports often had an immediate financial market moving impact, making them lead stories for a market driven broadcast.
I cringed because I believe attempts to undermine the credibility of these reports do a great disservice.
I remember one specific lunch with Paul Kangas. Silly, isn’t it? I spent a fair amount of time with Paul during the many years I was associated with public television’s Nightly Business Report. That included several meals with a man who, among many other things, appreciated good food and drink. Why would one particular lunch stand out?
It was 1990. A year before I had moved from Chicago, my hometown, where I worked for CBS, NBC, and as a freelance contributor for NBR, to New York. Here I was NBR’s New York Bureau Chief and Senior Correspondent. Paul had been with NBR since it first went on the air in 1979. A former stockbroker, Paul was at first the broadcast’s stock commentator. Later he added co-anchor to his role.
But Paul was so much more than his title implies. On a broadcast that itself defined a new role for business news on television, Paul set the standard for both the program and the industry.
I did not go to witness the ceremony of remembrance at the 9-11 Memorial today. I am never comfortable when I am at the 16 acre site of the World Trade Center in Manhattan. It’s not the memories. Those come and go depending on what is going on in the world. It’s the images which lingered before me for months after that day. Now they almost never return. Unless I am at the site.
On September 11, 2001, my wife Amy and I lived in Battery Park City in lower Manhattan. We had moved there from midtown just a few months earlier. Our apartment building was at the south end of the neighborhood, south and west of WTC Tower #2. I was the New York Bureau Chief and Senior Correspondent for public television’s Nightly Business Report and the newsroom/production facility/broadcast studio was just across West Street, even closer to the tower, due south of the site. Tower #2 filled the window of my bedroom, and of my office.
I was putting on my tie when I heard a noise I later described as the sound of a dump truck unloading gravel at my feet. Running to the window, I saw smoke coming from the top of tower #1, the view partially obscured by #2, which was closer to me. I had been through the 1993 terrorist attack on the World Trade Center, so I did think of that. But I thought in terms of a bomb planted inside, or an explosion on one of the equipment floors toward the top of the building. It was 8:46am.
50 Years. It is hard to believe. I still remember where I was and who I was watching with on September 8, 1966, when Star Trek premiered on NBC. If only we knew then what we know now.
The anniversary has triggered a deluge of comments on social media and, as is usual in this day and age a great deal of controversy. And why not? The original series, now formally known as TOS, has been followed by four more, plus an animated series. And a fifth is on its way. On this date we can also count a franchise of 13 films. I’m not going to even try to total the number of novels, comic books, works of non-fiction about the Star Trek world and the success of the concept. Or the number of doctoral dissertations written about this phenomena, or the number of college courses taught on Star Trek themes. It is all a moving target.
And because in these days of social media anything and everything becomes an issue for debate, it should be noted that while many commentators see Star Trek as a noble venture which presented sensitive and controversial issues to a world not ready to openly discuss them and encouraged generations of young people to pursue careers in the sciences, others see Star Trek as a fable describing a utopian world to which even it was not faithful. Like most of these disputes, where is some truth in both positions.
Today I take on a new project, writing about financial market reporting for the Donald W. Reynolds National Center for Business Journalism, which is based at the Walter Cronkite School of Journalism and Mass Communication at Arizona State University.
Hopefully these thoughts on my experiences over the years will be of value to journalists new to journalism, or just taking up an assignment on the business beat.
Please be gentle with your reviews!
Robert F. Goheen was a professor of classics when he was selected, at the age of 37, to become the 16th president of Princeton University. When he began his term in 1957, Princeton was a good school. But it was also very much a southern men’s club. When he stepped down in 1972, Princeton was one of the world’s great universities, having grown greatly in size and budget; in research productivity; and in ethnic and racial diversity. And it had become coeducational.
That last change was probably the most traumatic. Princeton’s trustees voted in favor of coeducation in the spring of 1969. The first women to be admitted as freshmen in an incoming class arrived that fall, members of the class of 1973. I was a member of that class, and I remember the turmoil on campus, with television crews running all over asking everyone what they thought of the matter. Since I had attended a coed elementary school and a coed high school which had far more diversity than was found at Princeton in 1969, I didn’t see much novelty. In fact, with only one hundred women and about one thousand men in the class, I found the ratio disappointing!
Goheen had championed coeducation in spite of some fierce opposition, mostly — although not exclusively — from alumni who decried the loss of a tradition and threatened to withhold their monetary contributions in protest. Moreover, his support marked a reversal of his earlier position. In 1965, he opposed coeducation, but changed his mind four years later.
I usually find when a journalist writes about journalism, the result is boring, or self-serving, or both. But with all the discussion surrounding Rupert Murdoch’s bid to buy The Wall Street Journal, the sales of the Tribune Company and
Reuters, and complaints from shareholders about the performance of New York Times stock, I’ll take a chance.
I remember when I was in school, back when dinosaurs roamed the earth, trying to decide between two career interests, the law and journalism. The law seemed the more serious profession. But it was the time of the Watergate scandal. The journalists were the heroes, and the lawyers were all going to jail.
I chose to be a hero. As I look back, I figure I would have made a lot more money had I chosen the law. Otherwise, I remain satisfied with my decision. Continue reading →