Gillian Tett, Assistant Editor and Columnist, Financial Times, delivered the keynote speech at the Knight-Bagehot 37th Anniversary Gala in New York on October 24, 2012.
The Knight-Bagehot Fellowship in Business and Economics Journalism has helped mid-career journalists hone their reporting in the field for over thirty years. As a part of its fundraising efforts, the program hosts an annual gala dinner featuring a keynote speech from a leader in the business world. View video of the 2012 keynote speech.
Joining up the dots; why financial journalism matters more today than ever before.
Gillian Tett – Keynote speech to Knight-Bagehot 37th Anniversary Gala
New York, NY: October 24, 2012
Good evening everyone, and may I start by saying a big “thank you” to Jeff Bewkes, for his kind words, and for Terri Thomson, for organising this evening tonight. Most importantly of all, I want to say a huge “thank you” to all of you for coming along this evening and supporting this event, either as journalists, sponsors – or simply friends of friends who want a free drink. I first heard about the Knight Bagehot programme over in London a few years ago from FT colleagues such as John Authers and Jennifer Hughes who have completed the course and raved about it – and since I came to New York almost three years ago I have found out more. I am proud to say that two other FT reporters, Anora Makhmudova and Adres Schipani, were on the course last year and I have had the honor of serving on the board of the Knight Bagehot. And these encounters have convinced me that this is a truly terrific endeavour – perhaps one of the most important initiatives out there in the media world today. And I say that speaking as someone who is not just from the FT, and not just part of the community of business journalists who are here tonight – but as a citizen in a wider sense.
Most of us who are journalists here tonight became journalists because we had a deeply felt passion to tell people about other people; to explain the world; to shine light on dark corners; to join up the dots. The Knight Bagehot helps do that by training journalists to tell people about other people in finance and business – to explain how finance works, how business works, and how money goes round the world and makes the world go round. Or, more accurately, how money sometimes stops going round the world – as in the 2008 financial crisis – and damages all of us.
Now, in some senses, that sounds like a simple, obvious task. We are all natural gossips – we like telling people about other people. Most of us are curious about money, particularly when we get a chance to be nosy about other people’s money. But in other senses, the job of explaining how money goes round the world – or does not go round the world – is a fantastically difficult task. And that cuts to the core of the key message I want to impart tonight: never before has business journalism been more crucial to society more widely; but never before has it faced so many challenges. 2012 is the very best of times to be a business journalist. But 2012 is also the worst; or, at least, the most challenging. And that is why the Knight Bagehot programmes is so important to everyone sitting in this room.
To explain why I feel this so deeply, I want to give a little bit of my own personal history. I started life not in business journalism, but as an academic working in the field of cultural anthropology. As part of that, I travelled out to the far flung region of Soviet Tajikistan in the late 1980’s to do fieldwork. While I was out there, I became so consumed with excitement about what was happening in the Soviet Union that I decided that I wanted to be a journalist. But not any old journalist: what I dreamed of back then was becoming a mixture of Martha Gellhorn and Christiane Amanpour and Bob Woodward. For in those days, as an idealistic young person with a taste for adventure, it seemed obvious to me that if you wanted to really change the world and make an impact, then you ought to be writing about geopolitics, politics, society or wars. Covering revolutions or political scandal or global diplomacy sounded important and hip; covering earnings reports did not.
So that is what I did – I spent my mid 20s roaming profoundly obscure parts of the former Soviet Union, with unpronounceable names, covering dramatic political upheaval. And along the way had an electrifying time, and met some wonderful people, including my friend Chrystia Freeland who – like me – was working as an FT reporter there. I also met a range of people who mentored me, for which I will be permanently grateful.
Then I joined the FT as a full time graduate trainee, and life changed: the FT management decided that I needed to get a wider perspective on life, and be trained in “core” FT reporting skills, and so they put me into the London-based economics team, on the foreign exchange desk. I duly turned up, and my first thought was: “Yikes! Get me out of here! This is hell.” Coming from a social science background, finance seemed dead boring. I didn’t understand it and I felt very embarrassed admitting that I didn’t understand it. I also felt very daunted by the idea of making this tedious stuff exciting to the reader, let alone momentous. I could not imagine Martha Gellhorn writing an article about the forward dollar-yen swaps rate; there seemed to be little hope of using finance reporting to change the world.
So I sulked for a few weeks. But then, one day I suddenly woke up, grew up, and realised three things. Firstly, and most obviously, the way that money goes around the world really, really matters. Money, after all, is power. And so if you want to understand how power operates, you have to understand money – and I mean money in the very broadest sense, of business, economics and finance together. Looking at the world in terms of politics, culture or wars is important, but it is not enough; you have got to look at economics too.
Secondly, though, I also realised that if you look at money just in terms of the narrow economic numbers you will also fail to understand how the world works. Lots of people do that: bankers, economists, and market traders, say, are often trained to act as if money is a world unto itself and ignore the wider connections to society and politics. They have tunnel vision. But if you have that tunnel vision, you miss at least half the story.
And thirdly, to join up the dots in that way – to connect finance and politics and culture and business – you basically have to start by learning a language. Powerful business people, economists, bankers and so on love to wrap their craft in jargon, because – guess what – that reinforces their power. That can seem scary if you don’t speak that language. I know: as an anthropologist I was trained to understand Tajik wedding rituals, not the swaps market. But at the end of the day, all that finance and economics jargon is just a language – it can be taught and learnt. And you need to learn it if you want to understand how the world works today. There is no alternative.
So, in essence, that is what I have spent the last decade trying to do – learn the language of finance, understand how money connects to culture, power, politics and society, and then tell people about other people and how the world works. It’s what most of us in the room do. And when it goes well, this is the most fantastic job in the world: a privilege, an adventure, a career, a mission and a calling, all rolled into one. I wouldn’t swap this job for anything!
Now in some ways, 2012 is a fantastic time to be doing this. Why? Well, there are at least three reasons. Firstly, in the world we live in today, we have more access to information about finance and business than ever before in history; exponentially more, in fact. Think back a few decades, and you might remember that it was often very tough to get hold of data on, say, bond prices or stock markets. CEOs wouldn’t speak much to reporters, central bank governors were truly mysterious, timely data on the economy was hard to find, and market information was paltry. Now, however, we are deluged with this stuff; with a few clicks of a button we can get access to data on a scale that was inconceivable to earlier generations of journalists. I have seen this change with my own eyes: seven years ago, I started covering debt and derivatives markets and found it completely impossible to get basic data on complex products such as CDOs and CDS. Now, it is plopping into my email inbox every single day – without me even asking for it! The numbers I used to spend hours hunting for have almost become like spam.
Secondly, there is ample evidence that consumers of media – i.e. the public – want to read about finance and money. If you go back a few decades, the “business pages” of many mainstream papers were just a few stories wrapped around a stock market table. Now, most mainstream papers devote several pages to business and finance, because that is what their readers want. And lots of consumers are reading the financial press. And by press, I don’t just mean the print media: demand for financial information on television, and in digital form is booming. Bloomberg, Reuters and the host of new specialists blogs all know this well. In fact, if you look at the media world as a whole, Pew estimates that 20 per cent of all the space in the media – on the page, website and TV airtime in 2012 – was devoted to the economy, up from 14 per cent the year before (and far lower before 2007.)
In fact, just to get parochial for a minute, if you look at the FT I am proud to say that we now have more readers than ever before in our 124 year history – about 2.1m. We also have more subscribers – about two thirds of a million. And what you may not know is that more than half of these subscribers are digital, not print, subscribers. And that illustrates a crucial point – although the nature of journalism may be changing, because digital opens up more platforms, people still want our information, and they want it more than ever before. There is nothing like a financial crisis to make people want to find out about how money is moving round the world; or, as I said earlier, not moving.
Thirdly, as the hunger for financial and business information grows, this is helping some publications to create a sustainable business. Yes, we all know that the media has come under huge pressures in recent years. Papers have folded. Lots of journalists have lost their jobs. There were 56,000 journalists in newsrooms in 2000 in America, 53,000 in 2007, and there were only 42,000 in 2010. But business journalism has not seen such a big decline. It’s tough to measure because the data does not always break out finance and business reporters, but SABEW (Society of American Business Editors and Writers) membership is at 3,400, up 1,000 from a decade before. And one reason why business journalism has done better is that consumers – i.e. readers – are willing to pay for financial news, even online, which is not always the case for non-finance news. We are a bellweather for this: because more than half of our subscribers are digital, by the end of this year we will draw almost half of our revenue from subscription, not advertising. It’s a big shift.
But, of course, there is a catch. In fact two big catches. Firstly, while there is clear evidence that people will pay for financial and business news, nobody would pretend that it is easy for media groups to make money today, even if they sell finance and business news. The grim fact is that the profit levels and resources of the media lag far, far behind the people and institutions they write about. And when I say that, I don’t simply mean that journalists are poorer than bankers – though they are. Media groups are much poorer than banks, than companies, and so on. There is a real resource asymmetry. And that has big consequences: most notably, that those journalists who are trying to cover the business and finance world often feel – and are – outgunned by the people they are covering. VSS, the private equity group, estimates that this year American companies will spend $5.4bn on traditional PR, up 8 per cent from last year, and $5.6bn on word-of-mouth marketing, 22.3 per cent up from last year. I am not saying that is a bad thing; on the contrary, a healthy public relations industry can be healthy, if it helps to explain business and finance better. But the fact is that the media resources are not growing in tandem; and insofar as media groups are battling with PR to define the truth or public discourse, in resource terms it looks like an unequal fight.
Secondly, there is the problem of information. TMI, Too Much Information. In some senses, it is a wonderful luxury for the modern journalist to have so much information swirling around. But it can also be an utter curse. We are deluged with so much data that it often becomes harder and harder to make sense of it. The more detail we have, the harder it is to see what is important, and join up the dots. And doubly so in a world where many aspects of finance and banking and business are becoming more complex by the day. I found out this week, for example, that Dodd-Frank is expected to generate 30,000 pages of financial rules. 30,000! Who in the world of journalism today has time to scour those 30,000 pages to make sense of what really matters, what could affect society, what could blow up? Financial lawyers, particularly when they are hired by banks, have enough time to do that. But media groups do not. It is an unequal fight. Or to put it another way, if you want to hide something in the world today, you don’t need to create a hidden plot: you just need to wrap it in extreme complexity, and persuade the rest of society that it looks deadly dull – and too dull and complex for resource constrained journalists to spend time peering into that. But that trend, of course, comes at a terrible cost. What was happening with those CDOs a decade ago, after all, were largely hidden in plain sight – but was largely ignored until it was too late. Whenever the world doesn’t understand how business works – or how money is moving around the world – there is usually an accident there waiting to happen.
So that is why the Knight Bagehot program matters so deeply. To have a flourishing economy – and political economy – we need a flourishing media that understand money; but to understand money we need journalists who are trained properly and who speak the language of finance and business, on a par with those financiers and business people. So, for those of you who are starting out on their careers, I say this: don’t be afraid to learn a new language; even (or especially) the language of finance. Yes, it’s geeky and it can be tough to learn; but if I, as an anthropologist, did it, so can you.
Secondly, for those of you who are more senior, I would say this: try to find ways to let your staff learn that language, and then use it to peer into the dark corners with conviction and courage. And thirdly, for those of you who are sponsors of the Knight Bagehot, I would just say one thing: please open your wallets and support the cause. Not just for the sake of journalists, but wider society today. We learnt in 2008 what happens when the world doesn’t understand money; and we are still living with the consequences. It would be nice to think – or hope – that we are now learning the lessons: now, more than ever, we need media that are unafraid to shine light on the darker corners of finance and business and economics, and “join up the dots.” And to do that, we need journalists with the skills to understand and explain how money does (and does not) work.