Another Reason for Lousy Stock Market Reports

Dubner recently questioned whether there’s much (or anything) to be learned from stock market news.

A paper by University of Michigan political science professor Arthur Lupia and his students points to a major reason stock stories lack substance:

“Point blindness,” or what happens when news reports and citizens don’t realize that the value of a stock index point changes frequently.

Lupia proposes alternate — and easy — ways of reporting stock market information that will allow citizens to draw real inferences about stock values.

This skill is important, says Lupia, not just for someone’s own financial future, “but also to governments and others whose assistance will be sought if scores of people make bad investment choices simultaneously.”