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When the week's trading ended on Wall Street, CNBC's Erin Burnett reckoned that the broad financial markets had seen their worst selloff in five years. She listed a "perfect storm" of three negative factors for NBC anchor Brian Williams: home prices are falling more than expected; easy credit has dried up with all borrowers finding loans harder to come by; and crude oil prices are rising to "a penny shy of a record."
On CBS, Kelly Wallace mentioned one of those irritating misleading statistics to persuade us that the stock market is still fine for investors. "From 1985 to 2006," Wallace selectively quoted, the Dow Jones Industrial Average "grew an average of 8.6% per year. If you invested $1,000 back then you would have over $15,000 today." Well two can play at that game: consider the weekend's DJIA closing of 13265 and compare it to the 11722 it reached in January 2000 and you could come up with an equally fatuous counterquote: "Since the start of the millennium, the DJIA has grown at a rate of less than 2% per year. If you invested $1,000 back then, you would have gained only $132 in almost seven years."
As cheery as CBS' Wallace tried to be about the stock market, ABC's Betsy Stark (subscription required) was just gloomy about real estate. Housing is in "outright recession," she reported, "a major drag" on economic growth. "Businesses that depend on home building--from kitchen and bath retailers to furniture and carpet makers--are also getting squeezed." She predicted no turnaround for falling home prices until the end of the decade. The trend was illustrated by Sandra Hughes' profile of Los Angeles homeowner Judy Reidel for CBS' series Real Estate, Real Solutions. With prices falling, Reidel reckoned that she could recoup $70,000 by skipping a realtor and selling her 1920s Spanish-style home herself. Now after six weeks of open houses and an $80,000 reduction in her asking price of $1.4m she has still had no offers. Maybe Hughes' free publicity will help move the property. If so, what commission would Reidel owe CBS?
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