Why you can’t trust the media

Private homes hit by ECs … But overall sales rebound amid rosy economic outlook

As usual, the journalist turned to ‘research analysts’ from the real estate industry for comments.

To me, it is awkward asking anyone working in the property market — condo developers, real estate agencies, mortgage companies, property agents, surveyors, etc. — questions like:

• Do you see the market going up or down?
• Is this the right time to buy?

Will you ask the seller’s opinion when you cannot decide whether to buy or not?

It is the same ridiculous situation when you ask the fishmonger whether you should prepare fish for dinner tonight. Or step inside a slimming centre and ask the consultant whether you should lose weight or not.

I just finished reading Peter Schiff‘s The Little Book of Bull Moves.  He has this to say about the media,

One thing that strikes me as particularly comical is the way the media constantly ask the experts (typically realtors) if the time is right for buyers to step into the market and scoop up the supposed bargains. 

In the first place, has anyone ever met a realtor who told them now is not the time to buy? 

In the second place, the question misses the point that practically all potential buyers have already bought.  There are not too many of us who waited out the bubble, and those of us who did will certainly not be foolish enough to overpay now.

Remember not long ago (in the middle of this century), the media asked the realtors the same interesting questions during the bust of the property market. 

Every time these ‘experts’ would give answers like, “We are seeing the market picking up”, “I think we have reached the bottom already”, “Pick up some bargains now before the market rebounds soon” … only to see prices falling lower quarter by quarter.

I totally agree with Schiff on how to read comments from realtors,

Industry groups are invaluable sources of data but bring a bias to the dialog that should be discounted for what it is.

It reminds me of what Jim Rogers said in A Gift To My Children,

The media often propagates conventional wisdom.  Judge the content of stories in the media and turn their inaccuracies to your advantage.

And …

Everyone would be a millionaire if he could read a newspaper from the future.

It’s the future’s paper, not today’s paper!