The end of the world is nigh (-ish) (possibly)

A few postings ago ("If it wasn't for bad news....) I took issue with the economics editor of The Times, who was enthusiastically talking up a double-dip recession for the UK even as evidence emerged of rapid growth, falling unemployment, rising car sales, etc etc. The Times is still at it, and today it's been joined by the Daily Telegraph. This headline appears in chunky type over an article in today's Telegraph business pages:

US economy 'on the road to deflation', warns Pimco boss El-Erian

But immediately below that -- immediately below, not separated by any tedious text or photos, it says in smaller type:

Mohamed El-Erian, the head the world's largest bond fund, has said the United States faces a one in four chance of suffering deflation and a double-dip recession.

And then after a picture of a US banknote, the article proper starts with this sentence:

“I do not think the deflation and double-dip is the baseline scenario, but I think it’s the risk scenario,” Mr El-Erian, chief executive officer at Pacific Investment Management Co. (Pimco), told reporters in Tokyo on Thursday.

So, pace the Telegraph's headline writer, El-Erian's forecast is in fact that the US economy is very likely to avoid the dreaded double dip, although there are some downside risks. As, of course, there always are.

What the hell kind of journalism is this? Mind you, El-Erian doesn't exactly help himself. Check this out: "If you wonder how meaningful 25pc is, ask yourself the following question: if I offered you that I would drive you back to work, but there's a one in four chance that I get into a big accident, would you come with me?"

Well actually, Mo, if you told me the odds of a big accident were 5%, I'm pretty sure I'd be taking the bus back to work, although I'm aware that public transportation is not exactly thick on the ground around Pimco HQ in Newport Beach, Ca. So I don't think that's a helpful analogy at all.

There's nothing new about gleefully gloomy press reporting on the economic outlook. It reminds me of the people you used to see on the streets carrying those "The end of the world is nigh" placards (nowadays they usually have "Giant golf sale" on the other side). One day one of those guys will be right, but that doesn't mean that everyone who's ever carried one of those placards can be counted as a good forecaster. The same goes for the business reporters of The Times and the Telegraph.