Investing and the Press: Who's Watching the Herd?

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NEW YORK: The SEC is nervous, and not just about Internet stock-touting scams. Chris Ullman, the SEC's director of public affairs, calls it the "experiment in democratized investing": Nearly everybody has money in the market these days. And with two 24-hour news channels, a profusion of financial news-related web sites, and an ever-expanding class of investor-targeted Money-like magazines, the press will bear plenty of responsibility if this record-size herd panics and stampedes the markets right into another 1929.

Ullman was the moderator Tuesday at "Press Coverage of Stock Market Crashes," a seminar hosted by the Freedom Forum and held at the Newseum in New York. Featured speakers were leading lights from the New York Times and, counterbalanced by a mutual fund guru and a Yale economist. Everyone agreed on the easy part: Business news has never been better business. But there was fear in the air -- even the most bearish press coverage has had little effect on the individual investor's buy-now-and-hold-forever ethos that has fed the current seven-year bull market. Everybody listens, but no one ever sells. Which poses the big questions: If and when a crash starts, what should the press say? Which analysts -- pessimists or optimists -- should they interview? Because a heavily invested America will know about it instantly. And with the sound of a thousand talking heads buzzing in its collective ear, the next Great Depression (or the next harmless Black Monday of 1987) could be decided by a coin flip.