Friday, September 17, 2010

Why Can't Our Financial News Have More Credible Information?

The following commentary was made by theSun in the essay entitled Credible information vs speculation.

  • Credible information vs speculation

    THE murders of cosmetics queen Datuk Sosilawati Lawiya and three others have captured the public imagination and triggered a media frenzy not seen since the death of political aide Teoh Beng Hock last year. News of the circumstances surrounding the heinous crime have hogged the headlines in print, electronic and digital media since the arrest of five suspects on the first day of Hari Raya followed by two lawyer brothers on Saturday and an eighth suspect on Sunday. There is no lack of theories, speculation and conspiracies on the motives and how the murders were carried out, some based on gossip, hearsay and a few far-fetched, but most quoting unnamed sources.

    Some media organisations, even those which are traditionally conservative, are so caught up in getting the juiciest, most sensational and horrific details of the case that they throw caution to the wind and forget their responsibility to report truthfully, accurately and factually.

    Officially, we know that Sosilawati, 47, her lawyer, her personal driver and a bank officer were reported missing on Aug 30 after heading to Banting, a town more famous for badminton and the Morib beach nearby than gruesome murders, to discuss a land transaction. Following the discovery of lawyer Ahmad Kamil Abdul Karim and Sosilawati’s cars in Subang Jaya, police investigations went into overdrive. The arrest of the first suspects and news that the four missing persons had been murdered were splashed on the front pages of some Sunday papers.

    Criminal Investigations Director Datuk Seri Mohd Bakri Zinin confirmed at a press conference on Sunday that the lawyer brothers, one a Datuk, and six workers of an oil palm plantation in Banting had been arrested and that they told police that Sosilawati and her companions were murdered and their bodies burned. He also said that police were gathering forensic evidence and that the families of the victims and the media will be notified as soon as the forensic and chemistry reports were available.

    Since then, official information from the police has been scant leading the media to ferret for scraps of information from "sources". The last "progress report" came on Wednesday when the inspector-general of police announced that the case had been solved. Kudos to those who have been toiling day and night on the case. But police work is not done and putting together the evidence to make an airtight case and win a conviction in court may prove even tougher.

    In such a high-profile case where one of the victims is a successful and well-known personality, public interest demands that the investigation is thorough, transparent and professionally carried out. We have no doubt that police are putting every available personnel and leaving no stone unturned to ensure that the investigation and evidence-gathering are carried out with utmost integrity and urgency. At the same time, it is hoped that the police will keep the public updated officially on the progress of investigations without compromising the case. The only way to stop spurious speculation and conspiracies is by way of credible and timely information
Yes, although the article did NOT have anything to do with the financial markets BUT what's most striking is that theSun is calling for CREDIBLE information.

Let me quote the following again again:
  • ... but most quoting unnamed sources.

    Some media organisations, even those which are traditionally conservative, are so caught up in getting the juiciest, most sensational and horrific details of the case that they throw caution to the wind and forget their responsibility to report truthfully, accurately and factually.

Yes., I find it way too amusing.

In our normal daily lives, most of use, hate reading all these stories quoting unnamed sources.

And they usually end up as nothing but plain old gossips. Yes, the coffee shop talk. Plain and simple.

So in terms of our local financial markets, why should it be any different?

Why can't our financial news reporting publish financial news that consist of credible information, instead of the and 'it is believed' crap that we read constantly in our financial news?

Is it because that we find it acceptable to read speculations simply because it represents an so-called opportunity to punt on the stock based on the story and make some money along the way?

Yes, does the reason of being given an opportunity to make money justify the inaccuracy of our financial reporters?

Do we want to continue to read and read and read and read financial news based on un-named sources simply because it represents an opportunity to make money?

And mind you... sometimes... these so-called opportunities are so deadly for they make a sucker out of the punters money!

Take the following posting on Jose Barrock And Baswell Resources

In article named Takeover on the cards at Baswell?, the writer writes the following..

  • This trend of heavy trading volume started last Friday, when some 4.86 million shares were transacted in the tightly held counter.

    Although not certain as yet, a takeover could be on the cards at Baswell.

It was amazing! The writer admits that although it was NOT certain yet, he speculated that a takeover could be on the cards. Yeah, did that article based the reporting on 'credible information'?

The stock rises... no thanks to such reporting.

Company when queried denies such blatant reporting.

  • Reference is made to the letter from Bursa Malaysia Berhad dated 19 January 2010 and the Article entitled :"Takeover on the cards at Baswell?" which appears in The Edge, Financial Daily, Cover Page and Page 4 on Tuesday, 19 January 2010 ...the Board of Directors of BASWELL wishes to inform that, after making due enquiry with all Directors and major shareholders and all such other persons reasonably familiar with the matters about which the disclosure is to be made in this respect, the Board of Directors wishes to clarify that it has not, to date, received any take-over offer on the shares of the Company.
  • ... Company has neither verbally nor in writing released any information to the author of the said Article.

Then few months later... Baswell became a PN17 stock!

Or how about this article: EPIC surges on proposed privatisation report
  • The Edge Weekly reported Terengganu Inc approached some of the other large shareholders of EPIC to buy over their equity, which will then trigger a mandatory general offer that would ultimately lead to privatisation.

That story drove the stock up ( see And Our Financial Press Drives Up A Stock! ) and needless to say that story was denied.

Or how about this posting: Should Media Continue To Spin News To Drive A Stock Up?

  • We refer to the article entitled "Are E&O shareholders looking at privatisation?" published in The Edge on 2 August 2010. E&O would like to clarify that the Company has not received any notice from any of its shareholders pertaining to plans to privatise the Company. The Company is also not aware of any such plans by any of its shareholders.
Or how about this article last year? According To Sources: Proton To..
  • Proton to divest Edar to EON
    Written by Jose Barrock & Surin Murugiah
    Tuesday, 21 April 2009 10:49

    KUALA LUMPUR: In a move that could kick-start the consolidation of the fragmented automobile industry in the country, national carmaker Proton Holdings Bhd is looking to inject its distribution arm, Proton Edar Sdn Bhd, into Edaran Otomobil Nasional Bhd (EON).

    The exercise, expected to be announced next month, will consolidate the distribution arm of the national carmaker into EON.

    Sources said that Proton will get EON shares in return for divesting Proton Edar. This would result in both Proton and DRB-Hicom controlling the distribution of the national automaker’s vehicles.

    It also effectively puts EON back to its original position as the sole distributor and authorised servicing agent of the national car.

    It is not clear how much equity Proton will end up having in EON. At the moment, DRB-Hicom controls 79.05% of EON while Kualapura Sdn Bhd, the private vehicle of Rin Kei Mei, holds 12.1% in the auto distributor...

That story was denied. More On The Rumours Of Proton Divesting Edar To EON

Yeah.. who are these sources?

Isn't it ironic?

Perhaps the SunDaily could do a nice exposé on why our financial reporters keep on publishing financial news based on un-named sources?

Don't we want to read financial news based on credible information?

Or should the readers prostitute themselves for the sake of having an opportunity to make money and accept such news because such news normally drive the stock higher?


Caryen said...

Moola, It's simple to quote "unnamed" as their source lah. No need to bear responsibility mah. By spreading those take-over news. Sure the media was helping the unnamed person to sell out their stock.

Too bad to those who read the paper and jump into it. Small fish always eat last but die first.

Moolah said...

I just find it unacceptable that our financial press makes such reporting.

It's utterly disgusting.

Moolah said...

And I find it too amusing.

Companies are always given a query from Bursa whenever such un-unamed sources spin is published in the media.

Companies have to WASTE their time to respond to those baseless statement. ( Er.. these companies have nothing else better to do? )

And it repeats and it repeats.

Now I wonder... why don't they ask these so-called reporters and ask them to name their sources!

Hey, I have always maintain the fact that anyone can be a source of information. The tea lady sure qualifies as one. The 'jaga kereta boy' also qualify as one. Yes, they can be a source of information.

However, whether their information is credible is a very different issue!