Credibility concerns spook equity markets
There have been a number of upbeat data releases in the U.S., including one on manufacturing activity and another on consumer confidence. So, why is it that equity investors are so gloomy? It could be that the Enron debacle and a slew of revelations from other corporations is making them a bit nervous. For the first time, in a long while, they may be reflecting on the difference between image and reality. Now, any half-decent psychologist will tell you that understanding reality is not just a straightforward process of evident facts determining correct perception, but of perception selecting facts which in turn affect perception. How we perceive reality is filtered through a whole system of received ideas, ideologies and media presentation of events. Rational, cool heads are few and far in-between. The concerted efforts of those in media, marketing and public relations are aimed at truncating critical thought and promoting a particular
