IF ever critics of the media’s economic analysis needed ammunition, the recent terrorist attacks seems to have provided plenty.
Take, for instance, the contrast between post-September 11 coverage of economic matters in Australia and the US.
In the months following the attacks, the Australian media usually painted a doomsday scenario.
Early forecasts indicated economic activity would slump, while others went so far as to predict the demise of the capitalist world.
Four months on and, with the release of the key economic data coming from the period behind us, many are left wondering what all
the fuss was about.
In the States, the media’s take on events was different. Ever the optimist, US commentators, after their initial shock, continued to speak of a quick turnaround. The buzz was that the US was going to experience a V-shape recovery.
Ongoing bad economic news that indicated a country in recession did not dampen enthusiasm.
This prompted US Federal Reserve chairman Alan Greenspan last week to give the market commentators a reality check by questioning the V-shaped scenario.
BankWest economist Alan Langford believes the catch phrases used should not be treated too seriously.
“The big fad was the V-shaped economy. Now the new fad is the double-dip economy. Yes, they are just a fad, but they seem to take on a life of their own,” Mr Langford said.
BIS Shrapnel economist Matthew Hassan said: “I think the media goes into a bit of a cycle, from extremely pessimistic to extremely optimistic and the truth often lies somewhere in between.”
