Everyone understands that the mass media has changed drastically. Not so long ago, we relied on daily newspapers, TV, and radio for all the information we needed to help us make informed decisions and stay abreast of current events. Now, in the age of the internet, we seem to be constantly bombarded with headlines, updates, and “breaking news” from our laptops, desktops, and cell phones—not to mention our TVs and radios!
However, as mass media has become so pervasive in our lives, one thing that hasn’t changed is the existence of “spin.” The explosion of media outlets in recent years has dramatically increased the pervasiveness of spin and made it harder to find truly objective reporting. With fierce competition among media companies, and the line between news, advertising, and “infotainment” growing thinner, modern journalists are under more pressure than ever to cut corners and put pleasing their bosses ahead of serving the public on their priority lists.
The result, more often than not, is reporting that is “spun” to someone’s liking or advantage, lacking objectivity. I often remind clients of this fact because I’m well aware that, amid this daily bombardment of mass media, it is likely they will come across news and information about annuities that has a negative “spin.” I point out that financial news is particularly susceptible to being “spun” a certain way because of a fundamental flaw in the financial system.
The Need for Optimism
The crux of the problem is that the heads of major financial firms on Wall Street are financially obligated to their shareholders first and to their customers and clients second. They have a legal obligation to maximize shareholder value, in part by keeping customers invested for growth in the stock market as much as possible. People are more likely to invest and stay invested for growth when they’re optimistic about the market and believe it is trending upward. Thus, Wall Street CEOs and the people who work for them have an inherent need to sell optimism and always speak optimistically about the stock market, often regardless of economic realities or how the market might be trending.
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