The Brexit Gulf — A Gap in Financial Media Reporting
The violent upheaval in the stock market and currency exchanges following the Brexit vote was accompanied by portents of doom amongst those favouring Remain, which included high-profile economists, media commentators, politicians and market analysts. Indeed, such was the hysteria in the immediate aftermath you’d be forgiven for thinking that the world was reeling off its axis, as schismatic voices in Scotland and Northern Ireland (and even in London) cried foul and demanded emancipation from the Brexiteers in large parts of England and Wales. Politicians fell and the Opposition party remains busy tearing itself apart in a curious farrago of public self-flagellation and introspection. Meanwhile, the most prominent Leave politicians in the Tory party enacted an Ides-of-March assassination in Westminster to make way for the steady ship which many regard the incumbent Prime Minister, Theresa May.
Time has tempered the panic and hyperbole. Although everything remains veiled in “uncertainty”, that most over-used of words, the UK remains extant, the stock market quickly rebounded and the pound has even started to recover a small amount of its precipitous initial losses.
What has replaced the apocalyptic headlines? Turning to the financial media and business pages specifically, a dichotomy in reportage has emerged — a gulf between pro-Leave outlets determined to spin Brexit in the most positive light as possible and publications that ardently favoured the Remain vote sounding a more downbeat note. If Brexit is the battleground, then data is the principal projectile. The way post-Brexit market data is interpreted by the media is a salutary reminder of Disraeli’s famous phrase, that there are three types of lies: lies, damn lies and statistics.
Perhaps the most stark example of this editorial capacity to twist and interpret statistics to serve one’s own agenda can be found in the recent reporting of fund outflows; in particular, the difference between the Financial Times and The Times — two behemoths of the UK media. On the face of it, data from Morningstar showing that investors had pulled £5bn from UK funds in July was wholly negative for UK plc. The Financial Times — a vociferous supporter of remaining in the EU, so much so that France has announced its intention to bestow its most prestigious civic award, the Légion d’Honneur on its editor, Lionel Barber — clearly agreed. Reporting the news in a suitably lugubrious fashion, its headline proclaimed “Investors pull £5bn from UK funds in July”, and that “asset managers suffer worst redemptions in 3 years”. Media brethren of the anti-Brexit narrative, The Guardian and The Independent, followed suit, tinging dispassionate reporting with Cassandra-like warnings implying that the worst is yet to come.
The Times, meanwhile, took a markedly divergent view. While the exact same data was cited, the angle taken was significantly more positive. The piece ran with the headline “Funds recover after biggest cash exodus £5bn”, opting to focus on the rallying of some funds rather than upon the £5bn fund withdrawal itself. The piece was deliberately bullish on the outlook for UK funds, and essentially brushed off the short-term exodus in favour of brighter future performance. This piece was published amidst a business section replete with Brexit stories, all burnished to shine with a brilliant positivity. In the first five pages of the section there were fourteen stories in total, eight of which were about the lack of impact that Brexit has had on the markets and wider economy. It is clear that The Times has taken the decision to position Brexit in the best possible light. This comes in spite of “The Thunderer” declaring for the Remain camp prior to the referendum. Whether it is a decision taken at an editorial level that the newspaper ought to do what it can to contribute to optimistic sentiment, which in turn can help drive economic and market strength, or indeed is influenced by a newspaper’s ownership, its intentions are evident. It may simply be that Theresa May’s laconic policy statement — “Brexit means Brexit” — represented an inflection point for the paper. Once secession from the EU was affirmed, perhaps bemoaning the outcome felt counter-productive.
So the way the Brexit saga is being reported is increasingly being dictated by editorial whims and strictures. Battle lines have been drawn and statistics are being closely monitored and seized upon when appropriate. Data is now contrapuntal, weaving its way through the media machine and emerging in many different guises. The message to businesses looking to disseminate data relating to Brexit is clear — be prepared to have your message and data twisted to suit an outlet’s agenda. Plus ça change you might say, but this seems to be particularly the case when it comes to the emotive issue of the UK’s withdrawal from the European Union.
Aidan Holloway, associate director, Smithfield Consultants.
