August 11, 2005
Web Provides Visibility
And Voice to Spread Ideas;
A Federal Reserve Blogger
By AGNES T. CRANE
For years investors have had pretty good access to the finest economic thinkers, via research reports and print and television media.
Now the floodgates are really open: The economists -- including prominent names from universities and even the Federal Reserve -- have started blogging, posting their thoughts on the Web on a variety of things, including the rise in oil prices and the future of interest rates.
While many investors continue to take their cues from traditional outlets, the real news junkies -- including those who aim to get a trading idea before they hear about it from their broker -- have bookmarked the blogs, or Web logs. Even Wall Street itself is paying heed.
"It's all about the 'memes,' " says Stan Jonas, head of interest rate strategy at Fimat USA in New York, employing a word that describes ideas that spread quickly by word of mouth -- or Web. "Those guys say it and about a week or two later, the guys on Wall Street pick it up."
Mr. Jonas once thought all the bloggers were "wacko." About a year ago, however, he came across one by Nobel Prize winning economist Gary Becker of the University of Chicago and his colleague at the School of Law, Richard Posner. Now Mr. Jonas reads as many as 30 blogs a day. A current favorite is Econbrowser (www.econbrowser.com1), penned by James Hamilton, a professor of economics at the University of California, San Diego, and a well-respected oil watcher.
Because bloggers provide a multitude of quick-links to other online postings, a thought developed in one place can quickly jump to other sites at the click of a mouse. Investors get a variety of views and ideas -- and the bloggers get exposure.
"This linking business is like a virus," says David Altig, economist and associate director of research at the Federal Reserve Bank of Cleveland who launched his site, Macroblog (macroblog.typepad.com2), a year ago. "I linked to somebody who started reading. Somewhere down the line, he linked to me. Then I became very visible."
Visibility is what counts for many of these economists who, like other bloggers, have turned to this medium precisely to get their voices heard.
"Nobody was asking me to write a column, and almost all previous attempts to even publish op-eds were denied," says Andrew Samwick, professor of economics at Dartmouth College, also known as Vox Baby (voxbaby.blogspot.com3) Now he has total autonomy -- and readers.
The top blogs in terms of the number of daily visits, still belong to those writing about politics. But the economists are making headway. Longtime blogger Brad DeLong (www.j-bradford-delong.net/movable_type4), a professor of economics at the University of California at Berkeley and Barry Ritholtz, chief market strategist at the Maxim Group and the man behind The Big Picture (bigpicture.typepad.com5), have cracked the top 100, according to Web site www.truthlaidbear.com6, which tracks blog traffic. Dailykos.com7, a left-leaning political blog, is still No. 1.
Most economics blogs have a bias. Some even read like rants. But the medium has given voice to those that have been drowned out by established venues. And that means trading ideas. The more sober blogs, meanwhile, lend legitimacy to the medium.
Mr. Hamilton only began Econbrowser this summer, but he's already much read by his peers, and others value his analysis and frequent posts. "I did it in part because all my career I've been following oil markets," he says.
Bloggers themselves also benefit from the contact with readers.
"On a professional level, I've been making contacts that I would have never made before," says Mark Thoma, associate professor of economics at the University of Oregon, Eugene. Mr. Thoma is also a self-described left-of-center Democrat and author of economistsview.typepad.com8.
Critics of cyberspace contend that like-minded blogs band together and actually undermine debate. To be sure, many economists wear their politics on their sleeves, but that's true in other mediums too, including, of course, print.
Having arrived, it's unlikely economists will be departing the Web anytime soon. Most everyone they want to reach surfs the Internet. And the economists do a lot of their work online anyway.
"I haven't stepped foot in a library in five years," says Nouriel Roubini, associate professor of economics at New York University's Stern School of Business and founder of the site Roubini Global Economics Monitor (www.stern.nyu.edu/globalmacro9), a one-stop Web site of economics research and blogs.
--Grainne McCarthy of Dow Jones Newswires contributed to this article.
Write to Agnes T. Crane at firstname.lastname@example.org
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