What can we say? We enjoy a good chuckle as much as anyone — although this doesn't exactly make you weep with laughter — but when a well-known business magazine resorts to making stuff up in a bid to attract eyeballs to its Web site, one can't help but feel that the end of serious financial journalism is near. It was bad enough when Forbes.com ran a piece a few months ago urging men not to marry career women; now it's devoting resources to producing copy speculating on the net worth of Thurston Howell III. (By the way, the author of the heavily trafficked screed against career women, Michael Noer, is also the lead writer on the Fictional 15 feature.)
And you know what? Forbes.com has actually been compiling the Fictional 15 since 2002. Is it just us, or does it seem a bit risky to continually parody what is essentially the cornerstone of the Forbes franchise — its Rich List? Plenty of critics have questioned the accuracy and value of the popular Forbes 400 ranking. (One of the most recent attacks came in Timothy O'Brien's book, "TrumpNation," published earlier this year and which attracted a suit from The Donald himself, but that's a whole other story.) By running a fictional version of the listing, complete with statements like "For the first time in the Fictional 15's history, Santa Claus has been unseated from the number-one spot, replaced by defense contractor Oliver 'Daddy' Warbucks," doesn't it become harder to take the entire Forbes ranking machine at all seriously? The bigger question, of course, is what type of readers do such features attract? Are they the high-powered business and finance types that Forbes has traditionally delivered to its advertisers? At the risk of sounding like a stuffed shirt, one does recall with a shudder the venerable adage about bad money driving out good. Maybe we even read about it in the old Forbes.
The New York Times' coverage of possible insider trading violations at hedge fund Pequot Capital Management Inc., which also fingered Morgan Stanley CEO John Mack and the Securities and Exchange Commission as possible co-conspirators, has been controversial from the start. Shortly after the paper ran its first story on the alleged scandal back in June, Times business editor Larry Ingrassia took a drubbing on CNBC's "Squawk Box" for playing such a potentially explosive — yet apparently thinly sourced — piece on its once-vaunted front page.
Six months later, the controversy keeps rolling along like the little engine that could. In fact, it recently boiled over into a battle royal between The Wall Street Journal and the Times that climaxed during Thanksgiving week, when no less a personage than Times executive editor Bill Keller defended his paper's coverage of the Mack-Pequot affair. The defense came in a letter to the editor that Keller penned in response to a piece a week earlier by Journal columnist Holman Jenkins Jr., who took Times reporter Gretchen Morgenson to task, without ever naming her, for a story last year on executive pay and for her coverage of the Mack insider-trading allegations. Jenkins concluded that because the Times allows "such stuff" into the paper, "it's hard to resist the urge to cheer on Hassan Elmasry," the Morgan Stanley fund manager challenging the New York Times Co.'s dual-class share structure. Ouch.
In his letter, which the Journal published Nov. 22, Keller does not deal with Jenkins' criticism of the executive pay piece but does defend the Mack coverage, a topic close to Media Maneuvers' heart. "First, let the record show that the Times has accused Mr. Mack of nothing," Keller wrote. "He figures in a congressional investigation of how the SEC does its job. The investigation rests on allegations of an SEC whistleblower who comes equipped with a trove of evidence that may or may not prove something amiss at the commission. Our reporters have not passed judgment on any of this. They have simply disclosed, with scrupulous fairness and copious documentation, a very interesting news story — one your own newspaper has found newsy, by the way."
To be sure, it is technically true that the Times did not explicitly accuse Mack of insider trading, but it implicitly did so in spades. In fact, in its first story on the matter in June, the Times took at face value claims by the SEC whistleblower, Gary Aguirre, that he had accumulated evidence that pointed to Mack's involvement in an insider-trading scheme. At the same time, it failed to provide even a hint as to what that evidence was, nor did it turn up or supply any evidence of its own. Indeed, the Times did not report on any of Aguirre's "trove of evidence" until October, and when it did, the evidence appeared to be very thin on the subject of Mack engaging in insider trading. (Its basic thrust was that Mack and Pequot's founder, Art Samberg, are good friends.) And while Mack may figure in a "congressional investigation" of the SEC, the Times' first piece focused mostly on the SEC's investigation of Pequot; the congressional investigation did not show up until the story's fifth paragraph.
But that's nitpicking. Keller seems mostly disturbed that Jenkins "casually insulted one of the best journalists in the business," meaning Gretchen Morgenson, though we would argue that Morgenson "casually insulted" John Mack, one of the biggest names on Wall Street, which, of course, is a place the Times loves to hate. He's also miffed that Jenkins attacked a corporate structure that prevents the Times "from being owned by a hedge fund," though he refrains from describing hedge funds as "secretive" or "unregulated," in a break from normal Times style. Keller goes on to laud Morgenson for her "immense civic value" and points out that she won a Pulitzer for work that the prize board called "trenchant and incisive." (Keller would mention Morgenson's Pulitzer laurels once again, in almost exactly the same way, less than a week later, after Barry Diller, speaking at the Reuters Media Summit, called her coverage of executive pay "absolutely loony.")
A Pulitzer is very nice and everything, but does that automatically make all of Morgenson's subsequent reporting beyond reproach? It is, after all, an old saw in journalism — this is the week apparently for hoary sayings — that you're only as good as your last story. Keller seems to be suggesting, not once but twice, that once you win a Pulitzer, that no longer applies. You're golden, for life.—Yvette Kantrow
From our most-recent-signs-of-the-apocalypse file we have this: a feature on Forbes.com entitled "The Forbes Fictional 15," a ranking of "fiction's very wealthiest." Heading the listing is Oliver "Daddy" Warbucks, who rubs elbows with the likes of Jed Clampett from "The Beverly Hillbillies" and Willy Wonka of chocolate factory fame. Each character comes complete with his own fake-fact-filled write-up, and there's the requisite slide show for those who feel the need to flip through photos of Richie Rich and Lara Croft. An accompanying piece (and slide show, of course) reports on the "fictional feast" this crew enjoyed for Thanksgiving dinner.
