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How Barron's got its groove back
The new-economy business magazines haven't flexed as much muscle as an old-school weekly that still knows how to make the Street go round.
With dot-com butt-kicking now very much in vogue, Barron’s — the notoriously bearish mouthpiece of Wall Street’s Burberry-suit establishment — has hit a serious groove.
Once considered a closed men’s club, Barron’s has recently become must-read weekend material with a series of market-shaking reports.
Take the May 8 cover story, “Wanna Buy a Bridge?” That article booted market wunderkind Cisco Systems off its high-valuation pedestal. Analysts and the financial media blamed the Dow Jones weekly for sinking the company’s stock — it dropped a painful 7.4 percent the following day — and dragging down the entire NASDAQ. What exactly did Barron’s say? That Cisco wasn’t worth its $68-a-share price tag.
The Cisco attack was just another blow to the battered tech sector. As new-economy stocks continue to fall out of favor, Barron’s has risen like a vulture over Internet and tech-flavored roadkill.
Barron’s rebound comes after the 79-year-old publication was dismissed as too old-guard for its own good. As the NASDAQ soared, Barron’s was written off as a surly-if-distinguished grandfather, quietly shaking his head while his whippersnapper grandchildren ran around buying Internet IPOs and tech stocks. No one wanted to hear windy sermons about valuations and profits; they wanted to make money — fast. But now, with the market turnaround, Gramps’ advice isn’t sounding so bad after all.
“They bring an establishment view toward the market by covering the rise of the new-economy sector very skeptically,” says Richard Cripps, chief market strategist at Legg Mason. “Their natural bent has been not to buy into the hype, and they’ve hit their stride attacking the new economy.”
That’s not to say Barron’s is always right. It’s published several cover stories that investors quickly rejected as bunk. Cripps, for instance, said a recent cover bad-mouthing AT&T was off the mark. But he acknowledges that Barron’s lately seems to be hitting the market hot spot.
The Barron’s buzz began in May 1999, with a cover story bashing Amazon.com as an overvalued, overhyped symbol of irrational e-commerce exuberance. As with the Cisco story, everyone from CNBC to TheStreet.com cited the Amazon.com piece, “Amazon.bomb,” as the culprit in the stock’s immediate free-fall. (It traded at $61 when the story was published and dropped to nearly $50 in subsequent days.)
Then came the infamous cover story, “Burning Fast,” which named 200 Web sites that were running out of dough. (Salon.com made the list.) The March 20 article, which provided all-too-painful details about the cash flow of several popular sites, inserted one of the first big pins into the dot-com balloon. It’s still blamed for busting up the e-anything party.
Barron’s editor, publisher and president Edwin A. Finn Jr. insists the publication, which he has overseen for the past five years, isn’t the big bad bear that everyone makes it out to be. Finn, for one, is a big believer in the Internet. And he says Barron’s runs three to four positive stories for every negative one. “But you don’t hear as much yelping about those,” he says.
Last week, after the Cisco story ran, Barron’s was swamped with calls, e-mail and letters. “The attitude of some readers was, ‘How could you say that about my Cisco?’” Finn says. “It’s as if we offended their religion.”
Such emotional outcry bodes well for the grand ol’ naysayer, which has translated its attention-getting covers into dollars.
From January through April of this year, Barron’s ad pages jumped 33 percent from the same period last year, while its ad revenue grew nearly 45 percent. Last month, ad pages were up a robust 47 percent, while ad income saw a 62 percent boost.
Finn is optimistic that the popularity of Barron’s will continue to grow as more people take control of their investment portfolios, thanks to the growth of online trading. He admits that when he arrived at Barron’s seven years ago as managing editor, it had the atmosphere of a “closed men’s club.” Since then, its covers have gone color; shorter stories have become more common; graphics are more frequently used; and editors are more likely to approve stories about big, splashy companies (i.e. the “Amazon.bomb” and “Burning Fast” covers).
But don’t accuse Barron’s of adopting an Investing-for-Dummies spin. It still offers pages of dry financial data about equity and futures options and obscure foreign investments, and its columnists assume a level of financial acumen that would scare off the average investor. “People tend to graduate to Barron’s,” Finn allows. But lately, lots of ordinary folks seem to be plunking down $3.50 to get their fingers smudged with Barron’s newsprint.
After all, not reading could cost them.
Diane Seo is the senior business editor at Salon. More Diane Seo.
Amazon’s $1 million secret
By quietly supporting small presses and literary nonprofits, is Amazon backing book culture or buying off critics?
(Credit: iStockphoto/stokato) The Brooklyn Book Festival’s website debuts a new feature this year called OnePage. Every week from March through September, OnePage will post part of a previously unpublished work — chunks of correspondence, scenes from books in progress — by authors such as Darcey Steinke, Martha Southgate, Paula Fox and Stefan Merrill Block. There will also be mini-profiles of participating small presses, including indie mainstays McSweeney’s and Akashic.
Continue Reading CloseAlexander Zaitchik is a journalist living in Brooklyn. More Alexander Zaitchik.
Scott Turow on why we should fear Amazon
The feds might sue Apple and publishers over pricing. But a top author suggests the e-retailer's playing monopoly
(Credit: AP/Ben Margot) Late last week, the Justice Department warned Apple and five of the nation’s largest publishers that it was planning to sue them for price fixing. At issue is the agency model, a method of wholesaling e-books in which the publisher sets the retail price and the retailer takes a 30 percent cut. Most print and many e-books are sold under the traditional wholesale model, in which publishers sell books at a discounted price, and the retailer can resell them for whatever price it likes.
The unnamed player in this drama is Amazon, which had been selling e-books at a loss until two years ago, when the iPad came along and publishers used the emergence of the new device to pressure the online megaretailer into adopting the agency model, too. If Amazon wanted to sell e-books from the Big Six (as the six largest book publishers are called), it could no longer sell those titles for $9.99.
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Laura Miller is a senior writer for Salon. She is the author of "The Magician's Book: A Skeptic's Adventures in Narnia" and has a Web site, magiciansbook.com. More Laura Miller.
Resolved: Kick the Amazon habit in 2012
Yes, you CAN buy e-books and support your local indie bookstore
(Credit: iStockphoto/PaulaConnelly/mbortolino) I suspect I’m not the only person starting 2012 with a resolution to buy fewer books from Amazon. Resistance to the e-commerce giant and its crypto-monopolistic ways crystallized just before Christmas, when it offered customers a 5 percent credit to use its price-checking app in brick-and-mortar stores, thereby undercutting local businesses.
Booksellers have been complaining about “showrooming” — the practice of using a bookstore to browse and learn about new titles while buying the actual books online — for a while now. Amazon’s holiday-season gambit, and a New York Times op-ed denouncing it written by novelist Richard Russo, alerted readers who value their local bookstores to the possibility that those stores will vanish if we don’t make a point of patronizing them.
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Laura Miller is a senior writer for Salon. She is the author of "The Magician's Book: A Skeptic's Adventures in Narnia" and has a Web site, magiciansbook.com. More Laura Miller.
When Amazon took my gold medal away
A novelist was thrilled when her debut made Amazon's mid-year best-of list. Then the new Jeffrey Eugenides arrived
(Credit: valdis torms via Shutterstock/Salon) Congrats! You’re the best. For now. That’s the essence of an email I got back in June, when my novel “The Adults” was listed as an Amazon Best Book of 2011 … So Far. You haven’t heard of this list? Two weeks ago, I would have directed you to my Amazon page, where you’d see the gold badge on my book. It was inscribed Best Book of 2011, and then in small print, “So Far.”
It was enough of an honor for me. The shiny addition to my Web page would boost sales, regardless of what was written inside it. A gold badge plastered to a rock would help it sell, even if what was written on the badge was, “This Rock Sucks.” It draws attention to the rock, makes you at least consider its worth.
Continue Reading CloseAlison Espach is the author of the novel "The Adults." More Alison Espach.
Amazon, the tax bully
After years of fighting, the Internet giant learns to live with the online sales tax
Jeff Bezos of Amazon.com (Credit: Reuters/Kim White) WASHINGTON, DC– Paul Misener, the vice president for global public policy at Amazon.com, appeared before members of Congress Wednesday to urge it to pass a proposed bill that would require online retailers — including Amazon itself — to collect state sales tax on the goods they sell through their websites.
“Congress should help address the states’ budget shortfalls without spending federal funds, by authorizing the states to require collection of the billions of revenue dollars already owed,” Misener said.
Continue Reading CloseMaggie Severns is a program associate at the New America Foundation. Follow her @maggieseverns. More Maggie Severns.
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