Tag Archives: Bloomberg Businessweek

An era passes

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The death of a brilliant colleague highlights our losses in media

Source: Anne Power

In the opening issue of The Pennsylvania Magazine, a monthly published from January 1775 until July 1776 in Philadelphia, editor Thomas Paine wrote: “A magazine, when properly conducted, is the nursery of genius; and by constantly accumulating new matter, becomes a kind of market for wit and utility.”

As a modern nursery of genius, there were few equals to BusinessWeek in its heyday, a couple centuries after Paine’s words were published. BW garnered National Magazine Awards four times between 1973 and 1996. From 1958 to 2004, it picked up nine Gerald Loeb Awards, regarded as the Pulitzer Prizes of business journalism, including five in the glory days between 1987 and 2004. Since being sold to Bloomberg News in 2009 and rechristened as Bloomberg Businessweek, it has picked up another couple NMAs and several Loeb Awards, including two this year.

Alums of BW – graduates of that “nursery” — have gone on to illustrious stints at The New York Times, The Wall Street Journal, The Boston Globe, the Los Angeles Times, Reuters, and The New Yorker, as well as online outfits including Poets and Quants, and elsewhere, including Bloomberg, of course. Some moved into substantial academic careers, including longtime editor Stephen B. Shepard, who founded and led a journalism graduate school at the City University of New York. Others have become novelists or gifted nonfiction authors. All of their work has been filled with wit and utility, indeed.

As someone privileged to work for the magazine for 22 years, until 2009, I was reminded recently of the place’s unique culture, sadly, by the death of a colleague there. Chris Power, a BW stalwart and international editor for most of the best years, died on Oct. 13 at 68. His passing drew more than 120 comments on a BW Friends site, most celebrating his wit, his skills, his easy way with people and his remarkable intellect. Some referred to his short stature – something he joked about – which reminded me of how a colleague once described Chris to me: “5-foot-3-inches of brain.”

Another coworker, a man I succeeded as Chief of Correspondents, described Chris as “an excellent editor who knew when to push fellow journalists to do their best work,” adding “he was always the gentleman.” Saying he was blessed to work with 35-year BW veteran Chris for decades, he added that “a key piece of what BusinessWeek was is now missing.” Yet another workmate called him “smart, fast and unflappable, no matter how tough the story or tight the deadline; all around one of the best.” Still another called him “the kindest, gentlest and cleverest editor I had.”

As Chris guided stories that a copydesk veteran called beautifully edited, he did so with style. “But most of all, I’ll remember Chris dropping by the desk and doing his soft shoe,” she wrote. “Even under the tightest of deadlines, he could lighten a heart.” At a goodbye party for a former top editor bound for Texas, another colleague reminisced about how the folks were all given hats. “When it was Chris’ turn to talk, he came up hatless and said, ‘When you’re 5’3”, you know better than to wear a cowboy hat,’” he wrote. Yet another former workmate wrote of Chris’s recipe for an extra-dry martini: “pour the gin, wave the vermouth bottle over the glass.”

Stephen Shepard, source: The Virtual Memories Show

The extraordinary outpouring of respect, affection and admiration for Chris reflected well on him, of course. But it also said a lot about the collegial and high-powered culture at BW, something that our top editor – Steve Shepard – fostered.

Sure, people brought a lot of brain power to the job. Our chief economist had a Ph.D. from Harvard, our finance editor earned his from The New School, others there had taught at Columbia, and the staff was filled with Ivy Leaguers of all sorts. As a magna cum laude graduate of Harvard who had been trained by Jesuits at Boston College High School, Chris fit in. He “was one of the gifted minds that made BusinessWeek BusinessWeek,” as one commenter put it.

But brains weren’t enough. To work at BW, you also had to be able to get on well, to work in a group, to produce the best damn stuff we could. When candidates interviewed for jobs, they would sit down with as many as a half-dozen people, I recall. The book, as we called it, was a team effort. “Chris was always smart, funny and – most vital to a young reporter trying to find her footing – helpful,” one former colleague wrote. “Farewell to a true gentleman!”

It was no wonder that BW won so many awards. It’s no wonder that it produced such good work.

Sadly, as veterans of the glory days are aging, we are seeing our numbers decline. The man who hired me (Keith Felcyn) died last year, as did a former assistant managing editor (Dave Wallace) and a former Tokyo bureau chief (Robert Neff). Earlier, we lost a former science editor (Emily Thompson Smith), a former managing editor (Jack Dierdorff), a much-respected Washington bureau chief (Lee Walczak) and a finance editor (Chris Welles). Such things are inevitable, of course, as the clock ticks on us all.

But, more than just the passing of such admired and often beloved people, these losses say something about the declines we are seeing all around in journalism. I can’t speak to the culture of Bloomberg Businessweek, but I suspect it’s rather different than the old BW (for one thing, Bloomberg let go or reassigned much of the staff and, for another, the magazine is entirely online now, so we don’t see the powerful blend of imagery and text that helped tell stories so well).

On a more troubling point, even with the exceptional journalism machine of Bloomberg News behind it, BBW and other magazines have lost the extraordinary power and reach they once had. It’s been a long time since they could make big-name CEOs and politicians alike anxious when that was appropriate, and their influence on public attitudes is dubious at best (as is the case with many newspapers).

Thanks to the Net and political changes, so many big-name publications in journalism have seen their influence shrivel. Organizations for which credibility, fairness and thoroughness were core values have lost subscribers and seen their staffs shrink, their economic wellbeing eroded. Today, lies from those at the top levels of politics gain traction because on the Net all voices seem equal and the loudest and least credible don’t even bother going through the responsible media. Instead, they take their distortions and distractions directly to the public.

Consider the appalling list of media outlets that have bent the knee to Donald J. Trump and whose inclination will be to pull punches. Paramount agreed to pay $16 million for a Trump library to settle an absurd CBS case and now the company and network are owned by Trumper David Ellison. He installed rightwing opinion journalist Bari Weiss as editor-in-chief at CBS News and is now pursuing an acquisition of CNN, jeopardizing its independence. ABC similarly agreed to pay $16 million to settle another dubious Trump lawsuit.

The broader media have similarly acquiesced. Facebook parent Meta agreed to pay $25 million and X $10 million, both related to lawsuits over the post-Jan. 6, 2021, suspensions of Trump accounts. Alphabet, the parent of Google and YouTube, agreed to pay $24.5 million to Trump and others over a similar suspension.

Encouragingly, Trump’s legal assaults on some media outlets have gone nowhere. This year, he sued The Wall Street Journal, a Fox property, in July over his 2003 letter to pedophile Jeffrey Epstein, a longtime friend of Trump’s. He’s seeking $10 billion. The president also sued The New York Times, demanding $15 billion for allegedly undermining his reputation with stories raising questions about his business acumen.

While he filed the defamation suits in federal court in Trump-friendly Florida, he’s been set back in both. Lawyers for the WSJ have filed for dismissal of that case, while Trump was forced to refile the Times case after a judge threw out his original 85-page complaint, saying it was laden with “florid and enervating” prose. The judge wrote: “A complaint is not a public forum for vituperation and invective.”

But Trump has a long history of using the courts – or trying to do so – to intimidate the press. In 1992, a colleague at BW, Larry Light, got hold of financial information about Trump that showed he had a negative net worth. As recounted by another colleague, Light’s inquiries drove Trump to march into Shepard’s office at BusinessWeek. There, the future president (whose companies went through six bankruptcies) launched into a three-hour tirade that included an anti-Semitic gibe about Light (who was, in fact, Episcopalian). Trump also threatened to sue but backed off after our lawyer told him his finances would then be opened to public disclosure in court.

After Trump objected, Time changed a cover photo; source: Deadline

Our editors at BusinessWeek and its owners at McGraw-Hill were not cowed or beholden to Trump. Shamefully, some of today’s media leaders are. Consider, for instance, Time owner and billionaire Trump backer Marc Benioff, under whose leadership the magazine recently replaced a jowly cover photo of the president that offended him with a more complimentary one. Benioff, who acquired Time in 2018, recently flip-flopped on backing Trump’s since-abandoned plans to deploy National Guard troops to San Francisco.

Much has changed in the media since Chris Power and leaders of his caliber set a demanding standard at BusinessWeek. Some magazines – The Atlantic and The New Yorker, for instance – and newspapers such as The New York Times and The Wall Street Journal continue to prize careful and thorough, if critical, journalism. Indeed, I am indebted to The Atlantic for the Paine comment, which appears in its wonderful November issue, which is devoted to the founding of the United States 250 years ago next year.

Source: The Atlantic

But the ability of such outlets to act as a check on unbridled power-seeking and self-dealing by Trump and his minions has been gravely diminished as much of the public and GOP politicians seemingly turns a blind eye on the excesses. In their war on the press, the rightists have sadly succeeded in defunding NPR, a key source of independent news. And the marketplace has savaged the economics of so many other media outlets.

Will some magazines – whether online or in print – remain or ever again become nurseries of genius? Some may. But Chris’s passing is yet another troubling sign of the passing of an era.

Smart or sophomoric? BW’s ‘edgy’ cover pushes the envelope

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What words come to mind when you look at the image from the latest cover of Bloomberg Businessweek?

For my Reporting 1 students at the University of Nebraska, the words include “amusing,” “comical,” “creative,” “clever,” and “intriguing.” Most of the 30 students in the two sections of the course liked the image and thought it just fine for the book. They would agree with the folks at The Atlantic who suggested it was “edgy.”

The enthusiasts offered other terms, too. “Fun,” “simple,” “funny,” “different,” “unique,” “surprising” and “attention-getting” were among them. Some said it would encourage them to buy the magazine if they saw it on the newsstand – which, of course, is what a cover should do.

“I love this cover,” said one student, who at 23 is a couple years older than most of the others. “If I saw the magazine, I’d grab it. I love the tie-in. It’s definitely an attention-grabber.”

Another concurred, adding a thought about the cover language. “If the title was about a merger, there’s no way I would pick it up. This I would pick up,” she said.

Many found it funny. “It’s fun. I like the design. It’s a mature joke,” she said.

Of course, opinion wasn’t unanimous. A solid minority, including some who found the image entertaining, thought it “inappropriate” for a national business magazine. Some even worried about kids seeing it on the dining-room table or newsstand. Two found it “distasteful.” While saying she found it “slightly inappropriate,” one hurried to add that she was not offended.

And some were just perplexed. “It’s just a couple airplanes,” said one. “Airplanes can’t have sex.” Another said he couldn’t get the image at first, since it looked like a couple planes colliding or flying in tandem. And one, blushing, said the word that came to mind was “sexual,” and she added that the idea was “disconnected.” She asked, “why refer to two plane companies as sexual?”

Classy alternative?

While most students in this sophomore-level class thought the image was a winner, some faculty thought it, well, sophomoric. Echoing the blusher, one sixtysomething prof puzzled over the idea that everything nowadays seems to be cast in sexual terms, especially among folks south of 25 (or, I’d add, south of 40). A longtime newspaper photo editor-turned-teacher argued that manipulating photos just isn’t kosher even if it’s dubbed a photo-illustration (which this wasn’t) because the technology makes the images too believable.

Some, by contrast, thought the image just fine — so long as it suited the target audience. One, who led the art designers at New York Newsday and The New York Times before returning to Nebraska to teach, was reminded of provocative covers Newsday would run to pop off the stands next to the New York Post and the Daily News. And another, a veteran of the New York bureau of the Miami Herald, thought this would, indeed, help the magazine stand out, adding that images of humping animals are not uncommon, so why not?

Outside of school, a friend at National Journal volunteered this (sans capitals, in a Facebook exchange: “it’s funny, it’s original, it makes the point instantly, it’s not actually icky (planes don’t really have sex, people!), and it makes me much more inclined to pick up the magazine than photo of a white dude in a suit or a photo of an airport. sometimes the worthiest stories on the most important topics are really hard to coverize, and i’m sure the writer is glad they found a solution. i wish i had more ideas like this for national journal.”

When I argued that the image might fit The Onion but not BB (or BW, as we veterans prefer), he added that we might see such an image on New York, Slate or The Economist. He might be right about that, since The Economist proved even more edgy, with camels — back in 1994. Of course, that was before the British pub became the force to beat in business magazines and, maybe, had less to lose.

So, gentle reader, what say you? Does an image of jets in flagrante suggest witty, smart, authoritative and sophisticated? Or is it just a ripoff of The Colbert Report and The Daily Show that offers sass instead of style? Does it suggest hip or, rather, desperation to look hip? In the end, do boinging Boeings reflect well on a national business magazine?

Wheelin’ and dealin’ with McGraw-Hill

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Just what is a stock worth?

The obvious answer, of course, is what someone will pay for it. And that depends on a host of factors, including the company’s business prospects, the appetite investors have for risk, regulatory challenges and the possibility of big change at the company. Pricing stocks is a gamble with as many variables as a roulette wheel.

So it’s amusing when a self-interested investor group pegs a value for a stock, insisting that’s what it should fetch if only company managers do what the group wants them to do. Just such a group has done this now with the McGraw-Hill Cos., my hard-pressed former employer. Some will laugh while others, including shareholders such as myself, surely hope the group is close to right.

Jana Partners and the Ontario Teachers’ Pension Plan, which recently bought up some 5.2% of MHP’s stock, say the outfit is worth $65 a share. But it will take a breakup to unlock that value and lift the stock out of its mire at around $40, the JOT group suggests. JOT is pushing its vision on chief executive officer Terry McGraw, urging him to take a cleaver to an operation his family has run since 1888. The group, whose holdings top those of the McGraw family’s now, aims to jumpstart an ongoing internal strategic review the methodical McGraw has been undertaking.

JOT offers an elaborate argument to arrive at its $65 valuation. Its presentation, replete with Power Point slides filed with the SEC, includes graphs like that above that spell out in precise detail what the value of the stock would be if such elements as the conglomerate discount and the cost of management overhead were factored out. The bar on the right represents the $65 mark; the one on the left, a depressed recent price. It’s all very tidy and scientific.

Of course, it’s all wishful thinking, despite the veneer of sophistication and precise calculation. JOT, for instance, figures that investors knock $11 off the share price just because the company is a conglomerate. It pegs the cost of the corporate cost structure at $6 a share. Once those millstones disappear — poof! — the stock rises, right?. And it says a buyback of stock, together with enhanced profit margins equaling those of peers, would push up share value another $7.50. Voila, $65.

Despite the numbers, there’s really nothing new about JOT’s thinking. The view that McGraw-Hill is worth more in pieces than as a single, un-synergistic, unit is as old as the company’s diversification. Critics have long carped that Standard & Poor’s has nothing in common with the textbook division. Even within a single division, the information and media services unit, there has been little synergy: before BusinessWeek was sold in 2009 and became Bloomberg Businessweek, it had nothing in common with a group of TV stations MHP put on the market some months ago. As long ago as July 2010, I rooted for a deal of some sort myself to sort out MHP’s challenges.

The difference now, though, is the environment. S&P has been set back on its heels by a Justice Department probe of its Pollyanna ratings — terribly flawed in hindsight — of mortgage securities prior to the housing crash. News of this investigation broke just after S&P downgraded U.S. Treasury debt to AA+, an unpopular move that has riled Congressional critics. Furthermore, recently enacted law, if not changed, will strip away requirements that securities carry ratings by S&P and its competitors. No wonder the stock plunged to about $35 in early August and rival Fitch Ratings downgraded MHP’s debt a notch to A. It all threatens S&P, which is why the outfit has brought in a fix-it man from Citigroup, Douglas Peterson, to take charge.

Then, on the textbook side, hard-pressed states aren’t buying many books for students these days. And the Net is making pricey hardbacks look antediluvian, oh so pre-Kindle. Kids will always need learnin’ but they might not need to pay so much for it, at least not to textbook companies. This is an existential challenge to the company.

All these pressures, I’m sure, have pinned MHP’s shares to the floor. Oh, don’t we all pine for the days when the stock rocketed to $71, back in mid-2007. Why would it ever be worth less? Why only $65 post-breakup now? Those Canadian teachers and their buds at Jana have talked up the value a bit, adding $5 a share so far with their lushly detailed charts and sharp calculations. Thorough coverage by the Wall Street Journal has helped, too.

But the real value of McGraw-Hill won’t be set by chalk-wielding Ontario-dwellers or hedge fund speculators. The market will rule. I’m sure hoping it rules well. Anybody think MHP is worth $100 a share to some savvy buyer? Do I hear $125?

There, there, dear: do tears belong in the classroom?

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In “A League of Their Own,” that wonderful 1992 film, a young woman player makes a dunderheaded toss and breaks into tears as coach Jimmy Dugan (Tom Hanks) yells at her. “Are you crying?,” he asks, stunned. “There’s no crying! There’s no crying in baseball!”

Boy, can I feel for Dugan. So far, I’ve had to deal with four incidents of tears in school. One time, I believe, the bad toss was mine. In the other cases, well, I’d point to hormones, undergrads facing job-like pressure for the first time or sheltered young women beginning to discover the world isn’t such a kindly place.

Still, I felt as flummoxed as Dugan did. Making girls cry is something only a true jerk would ever feel good about. This is so, even though a wiser colleague at Nebraska, veteran teacher and hard-boiled journalist Kathy Christensen, tells me tears come automatically with breasts. She shrugs them off.

Just under three semesters into my academic career, I don’t find the waterworks easy to dismiss. But, dear reader, you be the judge. Let me know if I blew it or could have handled these situations better:

Case No. 1 – I encourage an outstanding magazine-writing student to pursue an internship with Bloomberg Businessweek, my old employer. Before Bloomberg bought it, the mag had a tradition of taking on bright young interns, most of whom had no business training but who had lots of smarts. A colleague at the mag looks over her materials and says she’d be a wonderful recruit and he could use her skills in projects on business schools; he recommends her, as do I.

But, in myriad ways big and small, BW has changed. Bloomberg has her take a three-hour online test, parts of which are heavy on business knowledge (of which she has none, as everyone involved knows). She fails badly and folks there tell her she’s not a candidate. She comes into my office, crushed and weeping.

So I feel like a heel. I put her into a bad spot, after all, and she suffers for it. It also doesn’t help my credibility with the new BW regime.

Was I wrong? If students are willing to take a test and do badly, is it my fault? I warned her there would be business material on the test, even reviewed some general things with her. But I didn’t realize how much the game had changed. Seems to me I blew it. Did I?

Case No. 2 – As is my normal practice, I flash a student’s paper on the screen from a classroom projector. As a class, we criticize the work. I point out the positives and negatives of the piece, and suggest ways it could be improved. It’s pretty benign and no different from other critiques. We’ve had many such critiques that day. The class doesn’t say much one way or the other about it.

The student waits a bit after the lights come up, but then mutters to me, “you gave me a terrible grade on the paper, then humiliated me in front of everyone. I’m done. That’s it.” And she storms out, furious and in tears.

Her grade, a C+, was not on the screen, though her name was (regular practice in these editing and review sessions). Also, while rushing out, she informs me she will drop another class with me that she had signed up for the following semester and, later, she tops it all of by giving me a scathing evaluation at the end of the course.

Is it wrong to criticize students’ work publicly? The class involved peer-editing, so students criticized one another’s work in every assignment. And, in journalism don’t we face critics every time a reader opens a paper and curses about something he or she reads? In the end, I don’t fault myself for this one, but the drama did throw me.

Case No. 3 – A student has promised a colleague that she would deliver a finished video about a trip the colleague and I took with eight students to Kazakhstan in May. The students are no longer in our classes; some have even graduated, so we have no real sway over them.

The due-date comes and she hasn’t got the goods, but has several legit-sounding reasons. The colleague and I bemoan the fact that several students are behind – a hassle he has had in prior classes – and he gets a bit hot about the general problem. It’s a big thorn in the side for him.

The student, a smart and delightful videographer, breaks into tears. She then begins to apologize, explaining that it’s the time of the month for her (she really said that), she’s got problems with moving to a new city and she’s been working and traveling nonstop for weeks. My heart, frankly, goes out to her. I say, it’s not you that’s the problem here; it’s the general issue of how we can get students to comply with deadlines. I’m sure you will get your work done (which eventually she does, at least most of her work).

When I complain to my colleague later that we shouldn’t be making girls cry, he says, “They make themselves cry.” It’s not his problem, but theirs, he suggests.

So, was she being manipulative? Were we right to rant? Is a deadline a deadline?

Case No. 4 – A top student interviews with an internship recruiter. She says a couple silly things – including asking whether she needs to tell her soccer league that she can’t referee for a week during the internship – and strikes a tone the recruiter says is arrogant. In fact, he tells me afterward that he’s written “humility?” several times on his notes about her.

She comes by and I tell her I’m going to give her some no-holds-barred criticism about her interview. It won’t help her, I say, if I mince words, so I don’t. I tell her precisely what the interviewer had told me, and advise that appearing arrogant cannot help in such settings. You’ve got to seem humble, even it’s just for appearances. She breaks into tears, denies arrogance and says she was not asking for a week off for soccer. He misunderstood, she says, pleadingly.

This is one where tough-love was warranted, I believe. Still, the waterworks were troublesome. My own self-criticism: do mock interviews with students first from now on, giving them pointers that can spare them from making such mistakes. (By the way, she got the internship).

So dear reader, what say you? Are tears something teachers should slough off? Is it better that our kids shed them before they get into the workplace, where the consequences of mistakes can be far uglier? And how would you advise someone, still mystified by the half-adult psyches of undergrads, to deal with them? I’m thinking maybe I’ll just tell the kids that there is still no crying in baseball.

Luddites revisited — attacking high-frequency traders, speculators and assorted other market “vipers”

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Andrew Jackson, the country’s seventh president, was famous for railing against the financiers of the early 1800s. They speculated on “the breadstuffs of the country,” he warned. “Should I let you go on, you will ruin 50,000 families and that will be my sin! You are a den of vipers and thieves. I intend to rout you out and by the eternal God, I will rout you out.”

The quote, a favorite of bloggers who fret about plots to establish a new world order and such, would be at home today in the superheated arguments over high-frequency trading. The latest diatribe, I’m sad to say, comes from a dear friend and former colleague at Bloomberg Businessweek. Peter Coy writes, “The bigger the financial sector, the more dangerous it becomes.” He bemoans the flood of smart people going into the business, noting that a quarter of Harvard’s brainiacs in the early 2000s were drawn into investment banking and like fields. And he complains about banks “cranking up their trading operations in a way that imperils the financial system once again.”

His indictment, based on the May 6 flash crash, is headlined “What’s the Rush?” And his subhed warns “The American financial system is erratic and voracious, and keeps score in milliseconds. Here’s how to rein in the beast.” Among his prescriptions: a transactions tax of a few cents per $100 to “throw sand into the gears of high-frequency trading,” higher margin and collateral requirements, and steps such as new taxes to reduce corporate debt (on the idea that we’re being assailed by waves of “debt-fueled speculation.”)

Oh, come now, Peter. Let’s dial it down a bit. First, while the Great Recession was in part the fault of Wall Street, it was not a high-frequency phenomenon. Rather, we can blame bad securitization practices, flawed housing policies in Washington, poor market oversight and a raft of other well-documented problems. Superfast trading may have helped stocks crater, but it was not the force that drove them down.

Yes, one must admit that May 6 was not a good day for the high-frequency set. No matter how short-lived, the $800 billion plunge in the value of U.S. stocks that day was worrisome. Stocks such as Accenture slipped to a penny from $40 (before bouncing back) in trading patches as short as eight seconds. Clearly, something was amiss in the superfast computers at the likes of Getco.

But let’s keep a few things in perspective. First, after going haywire the market did correct itself. Prices came back, in most cases rapidly. The Dow lost 1,138.69 points from its high in crazed intraday trading on May 6, but closed just 341.9 points down, and regained all that and then some by May 10. Erratic? No doubt. Voracious. Okay, but when have traders been anything but?

Let’s concede that there’s something bizarre about high-frequency trading. Its relationship to real value in stocks is remote at best. So, too, is its connection to fundamentals such as corporate strategy, earnings power, savvy management. All that good stuff that financial journalists, MBAs and CEOs – and maybe even the odd stockbroker — prize is a few solar systems away from the zippy stock-swapping at Hard Eight Futures, Quantlab Financial and such. Those guys, snapping to the beat of their own algorithms, don’t give a hoot about such things. It’s all numbers, bro.

Let’s concede, too, that the liquidity the HFT pack supposedly brings is an illusion. It is most likely gone when most needed. The simile Peter uses – “like a swimming pool that dries up just as you jump off the high dive” – is apt (hat’s off to his wordsmithing). It’s hard to see just what value the high-freqs bring to anyone but themselves.

But, so what? Speculators, those oft-reviled folks who put the zing in stock markets, have always been in the game for the gamble. They see Wall Street as a massive roulette wheel and believe that any way they can tilt the spin to their favor – legally – is fair play. In an odd way, they are cousins to technical analysts who have long played markets free of the burden of fundamentals. Are we to ban the technical folk because their charts are more like astrology than investment? They, too, are an odd subculture of market players whose powers over stock movements one could decry.

Surely, there needs to be policing to make sure high-freqs don’t misuse the power they have to move markets. They do swap millions of shares in ridiculously short periods of times, all but blind to fundamental values. At times, they account for disturbingly high amounts of volume. If they intentionally – or through glitches – knock stocks down to absurd levels to profiteer in some market-cornering way, they need to be rapped hard for that. Fines, perhaps, or suspensions of trading privileges could be used to rein them in.

But imposing transactions taxes or worse seems like overkill. Such steps would penalize all players for the perfidy of a few. Let’s use the scalpel instead of the meat-axe and target the bad boys, not just the folks looking for an edge of a few milliseconds on the next guy.

By the way, it’s passably ironic that Peter’s employer, Bloomberg, as well as Dow Jones and other data-providers are tripping over themselves to serve up market data ever more quickly to the high-freq bunch. Some go so far as to rent space to traders — at premium prices — so they can house their computers cheek-by-jowl with providers’ machines and save milliseconds of transmission time. What these providers know, just as traders do, is that timely information is still everything in this game.

Every technological advance that changes the playing field makes folks nervous. Luddism is a natural reaction. Moreover, the markets have long been the playground of innovators and, as a consequence, the targets of critics. In 1887 the head of the Chicago Board of Trade forcibly removed telegraph gear from the floor of the CBOT because he couldn’t abide the electronic links to notorious Chicago bucket shops, as recounted by Rutgers historian David Hochfelder. One NYSE broker in 1889 complained that the “indiscriminate distribution of stock quotations to every liquor-saloon and other places has done much to interfere with business.”

We may not like the high-speed folks. We may deride them as little more than turbocharged gamblers, as Rain Man-like idiot savants unfairly using their powers to enrich themselves while adding nothing to the game. But they will be players so long as there’s money to be made. We can take the profit out if they don’t play by the rules (and, by the way, maybe some of those smart Harvard types in finance can cook up better rules to keep market ripples from becoming tsunamis). Let’s not, however, make life onerous for everyone in the process.

Economic Slowdown: Ideology at Work

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To the Obama-haters at the Wall Street Journal, the stubborn economic slowdown reflects business’ fear of looming tax hikes. The Administration-friendly folks at the New York Times, by contrast, blame the lackluster economy on political stalemate in Washington. Meantime, over at Bloomberg Businessweek, they tell us it’s all a matter of us having our cake and eating it, too — loving both the Bush-era low taxes and Obama-era high spending and failing to choose between the two.

The inability of our economy to surge back consistently from the Great Recession has become a Rorschach test for pundits. They look at the ugly blot and discern a pattern, one that – not surprisingly – reflects their biases. Love small government and Bush-era tax cuts? Obama’s overreaching is to blame for our woes. Never met a problem that more money from Washington couldn’t solve? It’s the shortfall in such largesse that is making that blot so skinny. And if they can’t make up their minds, they blame both Bush-era “wisdom and folly” – whatever that fence-straddling phrase means.

For my money, the reality is more a matter of the Depression-era notion of pushing on a string. Our policymakers can’t find the levers that will kickstart the economy, that will ignite the animal spirits of our business leaders, and that will drive down the pathologically high unemployment rate. Nothing seems to work, though the folks at the Fed aim to keep pushing whatever buttons they can. Their newest tack, revealed on Aug. 10: buying up more Treasury debt to keep interest rates low.

In the end, the problem may be that the hole we put ourselves into in the Great Recession is just depressingly deep. It took years to dig. And it could take years, sadly, for us to find our way out. To take just one measure, U.S. employment plunged by more than six percent in the recession that began in 2007, the steepest fall of any of the 11 recessions we’ve suffered through since World War II. To take another measure, these downturns lasted from six to 16 months, and our latest slide – believed to have ended in 2009, though the National Bureau of Economic Research has yet to date it – will almost certainly prove to be longer than any of them. (For policy wonks, the Minneapolis Fed puts all these comparisons into perspective here.)

If history proves anything, however, it’s that economies do claw their way back. Sometimes, they do so with the help of Washington. Sometimes, they move on despite government meddling, however well-intentioned. Even today, economists don’t agree on whether D.C. pulled us out of the Depression or prolonged it – making that bout of global misery our first and biggest political and economic Rorschach test.

It’s no comfort to people who have been out of work for months or even years at this point. It’s also small comfort to investors or people considering whether to deploy capital, especially since they are still sussing out Washington’s new regulatory reach. And, if this downturn proves at all similar to earlier ones, whole industries will emerge reshaped as a result of it (think Detroit), not to mention companies (think GM). We will come out of this as a far different economy with areas like Internet-related industries taking a dominant place over the manufacturing icons of the past. (How is it that people still have enough money for iPads?)

Following every twist and turn in this uneven recovery is enough to generate serious palpitations. For players in the capital markets – or anyone, for that matter — it’s healthier to set aside the dire headlines of the moment and keep your eyes on the horizon, however distant it seems. Bet on a long slow ride up, with lots of dips. Keynes famously said that in the long run, we are all dead. But at the moment, the promise of the long run is the only thing we have to hang onto.