Bloomberg News Pays Reporters More If They Move Markets
from the financial-meltdown dept
It's become quite common to pay online writers more if their stories cause surges in traffic for the site. It has recently emerged that Bloomberg News has taken this idea much further, as reported by Business Insider:
Bloomberg News has an unusual practice of paying some of its reporters explicitly for publishing "market-moving" stories.
The Business Insider post points out a danger of this approach:
We asked Bloomberg about the practice. A company spokesperson acknowledged it.
"It isn't news unless it's true. At Bloomberg News, the most important news is actionable. That means we strive to be first to report surprises in markets that change behavior and we put a premium on reporting that reveals the biggest changes in relative value across all assets."
Most of the people we spoke to, especially traders, were startled to hear about this practice, worrying that it might create an incentive for Bloomberg reporters to "push" or stretch stories with the specific aim of moving markets.
There's also the risk that an extremely volatile situation could go into meltdown as market movements are amplified by Bloomberg writers reporting on the effects of their previous stories, leading to a kind of journalistic positive feedback loop. This wouldn't be so problematic were it not for the fact that these movements can result in major losses and gains for some of the participants. It's easy to imagine companies or even some countries being massively affected by this, which raises the question whether it is ethical for Bloomberg News to encourage such risky behavior by its journalists.