Monday, May 08, 2006

"....Because the Light Is Better Over Here......"

There was a very nicely done, extended video obituary of Lou Rukeyser on CNBC last Friday night.

True to form, Maria Bartiromo added only some pensive looks and a few head bobs. No original thoughts. Rather, she seemed engaged in playing traffic cop among people like Tyler Matheson, Bill Griffiths, and selected guests. Then again, this obviated the need for a teleprompter, so she didn't squint or lean forward quite nearly so much as she usually does on camera.

I don't wish to dwell on Maria. Rather, I use her to make a point. It seems that CNBC, and most financial or business television, focus on the the stock exchange. Bartiromo's apparent claim to fame, judging from her CNBC bio, is that she was the first to report live from the floor of the exchange.

Big deal.

This so misleads people regarding "where" the action really happens. It's not on the floor of the exchange. You may as well put a camera on an Amazon warehouse to watch them fill orders off the shelf. Or maybe a Netflix distribution center.

The real action in the markets happens in the offices and at the computers of money management institutions around the globe. It's not sexy, and it's not very "active," from a television point of view.

So, the title of this piece suggests a comparison with the old joke about where to look for a lost quarter. Rather than focus on where the financial news is actually "made", CNBC chooses, instead, to cover what "looks" more like "news." Lots of people shouting and running. Earpiece tightly pressed in by the reporter, looking up at some apparent big screen, then around at the hustle and bustle. Boy, something must be going on there.

If that's true, why did John Thain go to so much trouble to get acquired Archipelago Holdings? All the news you need to know about the markets is on a realtime screen feed of your choosing, for free. Do you really think those people scurrying around the floor of the Exchange are the movers and shakers of the market?

Nope. They are the financial market's equivalent of the driver who brings the Domino pizza to your door. Better paid, but not much different functionally- the last step in an order taking/fulfillment process. And, yes, do check under the box cover to see if you're getting the right fill.

So, next time you see a breathless reporter or anchor for CNBC, or CNN, etc, on the floor of the NYSE, stop and think about what is really going on in the background. And why you are interested in what the order-takers "think" about the market.

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