January 21, 1999

Eyes on the Press

It's a Hit

Issue Date: November 1998
Cover Headline: "Market Madness: What Should You Do?"

After finding plenty to complain about with the other magazines, Money leaves me almost speechless. The magazine's main collection of articles offered many practical tips: why it might make sense to refinance a mortgage; why these were good times for dollar-cost averaging; and how to save on your taxes by selling your losers. An instructive graphic charted the Dow through the 1990s, offering the useful perspective that even if the Dow dropped 30% from its high, it would still be well ahead of where it was at the beginning of 1997.

In short, Money's coverage matched its stated view: "We're not going to abandon our basic principles -- that stocks are the best long-term investment, that buying and holding good companies is far wiser [eh, Foolish] than frantically shuffling in and out of the market." In other words, don't panic.

Money repeatedly aimed to reinforce the idea that investors should always evaluate their financial goals and the level of risk they're prepared to handle. If the market's drop led investors to undertake that evaluation, great. The magazine was there to provide some sensible guidance about what types of actions might be prudent and why. "You can't prevent the market from crashing," wrote Jason Zweig, "but you can control what you do about it."

Sure, Money misused the "D" word -- deflation. It also recommended some mutual funds that had badly underperformed the S&P 500 index. Both here and in its October coverage, Money made fairly superficial references to valuations that I doubt its writers could defend. But when they turned to an actual equity strategist for the November issue, they picked one who knew what he was saying. "Much of the correction has been quite emotional in nature, and relative to interest rates and inflation, stocks are cheaper now than after the crash in 1987," said Stuart Freeman of A.G. Edwards.

Amidst a newsstand of magazines that could have done you harm, Money's disaster issue would have done you actual good.

Next: Eyes on Business Week