Words To Profit By

By Marshall Loeb

In April 1956, I got lucky and landed a job as a business writer at TIME. "Son," my interviewer had asked, "do you know anything about business?" Stretching reality like bubble gum, I replied, "Sure, sure, I like business very much." In fact, I didn't know a stock from a bond. But I got the job anyway.

The point of this anecdote is that today, no business-news amateur, as I was, could ever nail such a job at a first-rate publication. Once a backwater, business reporting, writing and editing have become smart, sophisticated and the high-walled province of the expert, although it took the better part of 100 years to reach that status.

A raucous century that started with virtually no business journalism worth the name is ending with business reporting becoming an industry all its own, occupying much of the space of three national newspapers, three cable networks, three major business magazines and a dozen personal-finance magazines--and being prominently featured in local newspapers, on broadcast TV, radio and the Internet.

The rich roots of all this actually predate the past turn of the century, to 1882, when three striving journalists--Charles Dow, 31, Edward Jones, 27, and Charles Bergstresser, 24--started Dow Jones & Co. to pick up news and gossip and then peddle them to brokers, bankers and slippery speculators. In 1889 Dow Jones launched the Wall Street Journal, a four-page stock-and-bond paper. Price: 2[cents]. As Edward Scharff writes in his book about the company, Worldly Power, "The Dow Jones messenger boys and reporters hustled advertising and subscriptions while they made their rounds... Much of the financial advertising in the Journal was placed to buy the newspaper's silence."

At the century's turn, Dow died, Jones sold out, and in came the new owners: Jessie Waldron Barron, a prim Boston boardinghouse keeper; and her insatiable journalist husband, who persuaded her to put up the $2,500 down payment. Clarence Walker Barron, 5 ft. 5 in. and 300 lbs. in his prime, was a high-living, big-investing champion of unrestrained capitalism who improved the Journal's standards while ordering up stories promoting companies whose shares he owned.

Honest-to-goodness muckraking, though, was on the way. At McClure's weekly magazine, Ida Minerva Tarbell, daughter of a Pennsylvania oil producer who had been forced to eat dust by John D. Rockefeller's Standard Oil trust, was making life hell for the wizened John D. with a 19-part series on Standard Oil that ran from 1902 to 1905. Her work, plus the reporting of a few other intrepid journalists, notably at the hotly competitive mass-circulation papers of Joseph Pulitzer and William Randolph Hearst, became Teddy Roosevelt's big stick in his successful drive to bust the trusts.

But the 1920s brought in a different era: the Big Boom. Economists chattered about a "plateau of permanent prosperity"--sound familiar? The men who wrote about business were either hacks in eyeshades or dandy dilettantes who looked like escapees from The Great Gatsby--or crooks. A couple of Journal columnists planted their bylines above stories prewritten by corporate flacks; crusading Congressman Fiorello La Guardia exposed them by producing the canceled checks that the writers had accepted.

But, what the heck, happy days were here. RCA's stock, for example, rocketed in 1928 from $85 to $420. And the Journal's circulation surged to 56,000--just before the party ended. The fury of Black Tuesday, Oct. 29, 1929, was grossly underestimated by the press, TIME conspicuously included. Business journalists commonly wrote that the worst was over. Not even close. The Depression bit so deeply that the Journal almost died.

It was precisely at this awful moment that Henry Luce, the visionary Yalie who had fathered the newsmagazine in 1923, sought to produce a "literature of business." He wanted something much more than the stock quotes and carloading stats that dominated business journalism, and he got it by starting what he called "the Tycoon's own magazine," FORTUNE. The monthly was elegant, oversize, printed on parchment; amazingly priced at $10 a year; the originator of the lengthy, often condemning, corporation story--and an instant hit.

In the bleak mid-'30s, the Journal stirred to life under the prodding of a genius in shirtsleeves from the fields of Indiana, Barney Kilgore. He preached three dictums: Keep it simple, broaden the subject matter beyond finance to everything affecting earning a living, and make the Journal America's first national daily newspaper. "Don't write banking stories for bankers," he ordered. "Write for the banks' customers. There are a hell of a lot more depositors than bankers." Helped by the public's warm interest in business and industry during World War II and then by the postwar boom, Kilgore saw all his dreams come true. The Journal's circulation soared (today it is 1.74 million).

In the 1950s and '60s, TIME lionized the Capitalist as Hero in a flock of fact-packed if somewhat breathless cover stories. They were rather typical of the uncritical coverage in this age of conformity and steady growth. The 1955 Man of the Year was General Motors' central-casting CEO Harlow Curtice (he was Hollywood-handsome, tungsten-tough, up-from-the-bottom, etc.); that year, GM also topped FORTUNE's first 500 list. TIME created a sensation by spotlighting the little-known Jean Paul Getty as the world's richest private citizen.

Some of the most influential business journalism of this heady postwar era was published between the hard covers of books. William H. Whyte's The Organization Man (1956) and Vance Packard's The Status Seekers (1959) skewered conformity within the corporation. Rachel Carson's Silent Spring (1962) condemned corporate polluters and gave birth to the environmental movement. Ralph Nader's Unsafe at Any Speed (1965) led to drastic, overdue and life-saving changes in auto-safety standards. The underside of American business was also revealed in such hand-to-mouth, left-leaning publications as I.F. Stone's Weekly and Dorothy Day's Catholic Worker. Why these crusaders, and the subjects they exposed, did not command more attention in the mainstream business press is debatable--but surely the clout of corporate advertisers had something to do with it.

It was during this period that America's shareholders and entrepreneurs fast expanded, and few knew better how to benefit from that growth than bouncy Malcolm Forbes, the ultimate Capitalist Tool. His Scottish-immigrant father, Bertie C. Forbes, a popular Hearst business columnist, had launched the fortnightly Forbes in 1917 and profited from inspirational profiles of company leaders. The very first editorial in this very first U.S. business magazine began, "Business was originated to produce happiness, not to pile up millions."

Malcolm took charge in 1964 and found the go-go '60s a perfect platform for stories about swaggering entrepreneurs very much like himself. He put more emphasis on stock-market advice and edgy corporate pieces and used charm, guile and arm twisting to ratchet ad sales. He also promoted the hell out of his magazine, becoming the most influential Harley biker, hot-air balloonist and Faberge-egg collector of his era.

With consumer spending driving the economy's bus, it made sense for Time Inc. to mint MONEY magazine in 1972--but not without furious internal debate. Some higher-ups despised the title, if not the whole concept, as hawking greed. Circulation was a hard slog at first, and MONEY came within an inch of being shut down at least twice in its difficult early years. But by the late '70s, a focus on how-people-like-us-can-succeed lifted readership--and profits.

When the 1980s and '90s turned into the age of personal investment--courtesy of the 401(k)--as well as celebrity capitalism--courtesy of Michael Milken's junk bonds and the bull market--MONEY was joined by a passel of rivals, including SmartMoney, Worth and Mutual Funds, each of which made the eternal promise of investment journalism--pssst, you can beat the market.

The now ravenous quest for investment data would not be sated by print alone, a vacuum exploited brilliantly by Michael Bloomberg. Pushed out of Salomon Brothers in 1981, he invested his $10 million farewell gift in building a computerized data service that he turned into a global news service. Today 105,000 Bloomberg terminals light up the desks of banks and brokerages, and the company has expanded into magazines, TV and radio. Bloomberg's media churn out information about interest rates, currency-exchange rates and other streams of data that would have been considered exotic not long ago but are now as much a part of our lives as the sports scores.

The century's biggest flop in business journalism is broadcast television. TV with a business story is like a whore with a baby: it's a cute little thing, but what the hell to do with it? A business story's got no blood, no guts, no prime time. So business is left largely to expert talking heads. On cable, market-oriented business networks are surging like hot IPOs, but sometimes they give us information overload. The moment-to-moment changes in the major stock averages flash nervously on Bloomberg News; the stock tickers scroll rapidly on CNBC and CNNfn, citing the latest prices of individual shares; today's "stocks to watch" are featured on almost all the channels. All this encourages quick in-and-out trading, usually a route to the poorhouse.

By contrast, the explosion of business websites has led to a democratization of data. The Microsoft Network and many others give us--almost free!--information that was once limited to high rollers, everything from where to get the best deals in credit cards, mortgages and bank loans to often valuable advice from professionals on long-term market strategy. So consider how far we have come: a century ago, the messengers of Messrs. Dow and Jones hustled tips to a few fat cats on the Street. Now the Net brings a plethora of business information to one and all. And that can only be called progress.

Marshall Loeb, former managing editor of FORTUNE and MONEY, is now editor of the Columbia Journalism Review