'You won't believe what people are uploading'

Whoever wrote the positioning statement for CNN's iReport page didn't know how right he was.

"iReport.com," the pithy headline says. "See it first. Your Stories. No Boundaries. You won't believe what people are uploading."

Well, no, you won't believe what people are uploading. That's because you can't believe what some people are uploading.

FOR EXAMPLE, THE "iREPORT" that Apple chief Steve Jobs had been rushed to the hospital after suffering a massive heart attack. Not true.

The problem is, a lot of investors and Wall Street traders did believe what they read on the Cable News Network site. And Apple's stock tanked -- a 5.4-percent drop at its lowest.

Now, the Securities and Exchange Commission is investigating, according to Bloomberg News:

The U.S. Securities and Exchange Commission is investigating the origin of a false report on a CNN citizen journalist Web site that Apple Inc. Chief Executive Officer Steve Jobs had a heart attack and was hospitalized, according to a person with knowledge of the inquiry.

The agency's enforcement unit is trying to determine whether the iReport.com posting was intended to push down the company's stock price, said the person, who declined to be identified because the probe isn't public. The report is ``not true,'' Apple spokesman Steve Dowling said in an interview.

Concern about Jobs's health weighed on the shares this year, contributing to a 51 percent drop. The stock swing caused by today's erroneous report drew renewed calls for Apple, which has said only that Jobs's health is a ``private matter,'' to be more forthcoming, said Jeffrey Sonnenfeld, senior associate dean at Yale University's School of Management.

``Leaving it to rumor and speculation is reckless,'' said Sonnenfeld, who has personally owned Apple shares since 1997, the year Jobs returned as CEO. ``If he is healthy, they should say so. If he's not, we should know that too.''

The shares fell as much as 5.4 percent earlier today after the post on iReport.com cited an anonymous source saying Jobs was rushed to the hospital after suffering a ``major heart attack.'' The report has been removed.

John Heine, a spokesman for the SEC, declined to comment on whether the agency will look into today's erroneous report.

Apple, based in Cupertino, California, dropped $3.03, or 3 percent, to $97.07 at 4 p.m. New York time on the Nasdaq Stock Market. The stock earlier fell to $94.65, the first time it has traded at less than $100 since May 2007.

IT TOOK JUST A DAY to find someone in the journalism universe stupider than the Detroit radio reporter who got fired for wearing an Obama T-shirt while covering an Obama rally. Unfortunately, that "someone" is a whole network.

The one whose executives came up with "See it first. Your Stories. No Boundaries. You won't believe what people are uploading."

What were they thinking? Without close supervision -- and fact checking -- by an adequate number of editors for the task, CNN's iReport is ripe for victimization by a Janet Cooke a day. At least.

In the present era of lean budgets and leaner newsroom staffs, do you think CNN's iReport is getting supervision equal to the task? Today's fiasco -- possibly a criminal stock-manipulation fiasco -- says no.

I hope Apple sues CNN for millions, because CNN violated the cardinal rule of journalism: "If your mother tells you she loves you, check it out."

CNN didn't know the "citizen reporter" from Adam, but that didn't stop the cable-news outfit's web editors from taking his unconfirmed report and plopping it prominently on the iReport page. With nary a call to an Apple flack for confirmation.

Ever.

BUT IT gets worse, according to Henry Blodget of Silicon Alley Insider:

"Citizen journalism" apparently just failed its first significant test. A CNN iReport poster reported this morning that Steve Jobs had been rushed to the ER after a severe heart attack (story and screenshot below). Fortunately, it appears the story was false. We contacted an Apple spokeswoman, who categorically denied it.

CNN's iReport kept the report up until at least 10:15 AM, about 20 minutes after we published Apple's denial. The story has since been removed.

UPDATE: Here's CNN's official statement. CNN says it removed the story because the "community" brought the story to its attention. Importantly, CNN also refers to the content as "fraudulent," which is much stronger than "inaccurate." "Fraudulent" implies an intent to deceive.

CNN's iReport, Original Story

Steve Jobs was rushed to the ER just a few hours ago after suffering a major heart attack. I have an insider who tells me that paramedics were called after Steve claimed to be suffering from severe chest pains and shortness of breath. My source has opted to remain anonymous, but he is quite reliable. I haven't seen anything about this anywhere else yet, and as of right now, I have no further information, so I thought this would be a good place to start. If anyone else has more information, please share it.

Immediately after reading the iReport story, we contacted Apple. Katie Cotton, Vice President of Worldwide Communications, replied quickly, saying "It is not true."

A GUY with a trade blog can get an Apple flack on the phone after reading the CNN iReport, but a CNN web editor couldn't do the same before almost sinking Apple's stock by publishing something that flew in over the Internet transom?

Let the journalism world watch this train wreck carefully, then proceed exceedingly cautiously into the brave new world of "citizen journalism."

"Citizen reporters" work for free. And, sometimes, you're going to get exactly what you pay for.

Uh . . . because the bailout's better now?

Rep. Lee Terry, congressman for Nebraska's 2nd District, used to be agin' the Wall Street "bailout" plan. But now he's fer it.

Says the Omaha World-Herald:

The Omaha congressman voted Monday against the House version of the bailout, as did the three other House members from Nebraska and western Iowa. The others remain either skeptical or opposed.

Terry was one of the first to indicate that he could reverse course and support the bill, saying even before the Senate vote Wednesday that his key objections had been addressed.

He had called for an increase in federal insurance of bank deposits and a waiver of accounting rules that require companies to write down assets to reflect their true market value.

The Senate bill raises the cap on insurance for bank deposits from $100,000 to $250,000, and the Securities and Exchange Commission announced that it would ease the "mark-to-market" accounting rules.

"Basically, my demands have been met," Terry said Wednesday night.

He said he now expects that nowhere near the full $700 billion would be necessary — and he feels good about the plan.

"I still haven't committed to anybody," he said. "Maybe I'll think of a new reason to vote no, but I doubt it."

YES, THE ENTIRE Washington power structure was brought to heel by an obscure congressman from the plains of Nebraska. Who previously had been ready to blow up the nation's financial markets because "mark-to-market" rules and more FDIC insurance weren't included in the original package -- even though both long had been under discussion and could be implemented administratively.

No, Terry's flip-flop couldn't have had anything to do with this. Or this.

I mean, what's an entire city administration panicked over the prospect of not being able to float municipal bonds -- and over maybe having to cancel construction projects -- got to do with anything? Compared to "mark-to-market" reform, potentially selling your hometown down the fiscal river is peanuts.

Ditto that concerned billionnaire and civic titan you've got on the telephone there, wondering how you got your head that far up your ass.

Naw, Terry's switch was an entirely principled affair.

Whatever. Just so long as he switches.

Los Estados Unidos de Chiquita

In case you were unsure whether the United States is now a banana republic, this Associated Press story should disabuse you of any overly rosy notions:

Astounded by the U.S. government's failure to resolve the financial crisis threatening the foundations of the global free market, fingers of blame are pointing at America from around the planet.

Latin American leaders say the U.S. must quickly fix the financial crisis it created before the rest of the world's hard-won economic gains are lost.

"The managers of big business took huge risks out of greed," said President Oscar Arias of Costa Rica, whose economy is highly dependent on U.S. trade. "What happens in the United States will affect the entire world and, above all, small countries like ours."

In Europe, where some blame a phenomenon of "casino capitalism" that has become deeply ingrained from New York to London to Moscow, there is more of a sense of shared responsibility. But Europeans also blame the U.S. government for letting things get out of hand.

Amid harsh criticism is a growing consensus that stricter financial regulation is needed to prevent unfettered capitalism from destroying economies around the globe.

And leaders of developing nations that kept spending tight and opened their economies in response to American demands are warning of other consequences — a loss of U.S. influence globally and the likelihood that the world's poor will suffer the most from greed by the biggest players in global finance.

"They spent the last three decades saying we needed to do our chores. They didn't," a grim-faced Brazilian President Luiz Inacio Lula da Silva said Tuesday.

(snip)

China's influence in the outcome of all this could be profound because it is a huge investor in U.S. debt. It is already calling for strict new international regulatory systems to apply to globalized financial markets.

Liu Mingkang, chairman of the Chinese Banking Regulatory Commission, said Saturday before a weeklong bank holiday in China that debt in the United States and elsewhere has risen to dangerous and indefensible levels.

The rest of the world is taking notice. Many newspapers made references Tuesday to China's increasing importance in global finance. In Algeria, a large cartoon on the front page of the newspaper El-Watan showed Uncle Sam at prayer: "Save us!" he says, kneeling before a portrait of China's Mao Zedong.

NOW ALL WE NEED is a gruff and impetuous generalissimo in charge of things -- or perhaps a charismatic figure with a Messiah complex and a personality cult -- to complete our climb up the Chiquita food chain.

OH . . . CRAP.

'My advice to you is to start drinking heavily'

The official United States YouTube clip.
We just keep going to this one . . .
because it's so true. Contains profanity.

Dear World,


Hey! You f***** up!

You trusted us!

The Washington Post reports on markets and banks and economies (Oh, my!) in deep doo all across the world:

The turmoil that began on Wall Street now spans the globe.

Stock markets around the world cascaded lower Monday, European regulators announced the rescue of four major banks, and U.S. and foreign officials pledged to make hundreds of billions of dollars available to ensure that banks would continue lending to each other.

Yet the contagion continued. U.S. stocks opened weak, then fell off a cliff after the House of Representatives voted down a $700 billion plan intended to restore stability to the nation's wobbly financial system. That sent Brazil's stock market down 10 percent, prompting authorities in Sao Paulo to temporarily suspend trading, amid worries of a deep U.S. economic slowdown.

In the seldom-interrupted cycle of global financial markets, the extraordinary pace and scale of events brought an abrupt end to the confident attitude displayed by European officials as recently as last week, when officials claimed that shareholders and investors there had less to fear than their American counterparts because European banks weren't as heavily exposed to the troubled mortgage loans undermining the U.S. system.

(snip)

In France, authorities had been worrying about a sell-off of the stock of Dexia, a Franco-Belgian bank catering to local governments. The bank's stock dropped by more than a third in early trading Monday, then recovered slightly on a pledge from Belgian Foreign Minister Didier Reynders to step in with government funds if necessary.

The Paris newspaper Le Figaro said a U.S. subsidiary of Dexia, the bond insurer FSA, had caused concerns among investors because of involvement in shaky real estate mortgages in the United States.

Several analysts said the European banking problems are biggest at institutions with heavy exposure to European property bubbles. Millions of homeowners and developers took out loans against property that is no longer valued at what it was a few months ago.

Nicolas Véron, a research fellow at the Bruegel center in Brussels, said concern has risen about strains in the banking system spreading to the Baltic countries and Eastern Europe, where several nations also have experienced property bubbles.

"We knew this would happen, because the storm in the U.S. is so powerful," Véron said.

Suicide bombers of the economy

We're all Palestinian nut jobs now. Virtual suicide bombers of the economy.

Americans saw the prospect of a Wall Street bailout, and they freaked out. Started yelling "Death to the infidels!" Declared that if not pulling the financial markets' chestnuts out of the fire meant another Great Depression, then bring it on.

That's what enraged folks were telling reporters and cheerfully saying on talk radio all across the United States -- bring it on. Well, it's on. The Dow Jones Industrial Average fell 777.68 points today.

WHAT MIGHT have happened had Congress' failure to pass the "bailout bill" not come more than halfway through the trading day . . . before the Democrats and Republicans melted down into paroxysms of partisan s*** slinging?

Yep, barring a miracle of policy and politics, we really just might have us a depression now. Like H.L. Mencken said so long ago, "Democracy is the theory that the common people know what they want, and deserve to get it good and hard."

Who'd have thought what American voters most wanted was to be just like some Palestinian nut job, so intent on killing Jews that he's perfectly willing to blow himself up -- and whatever other Arabs might be within blast range -- too? Today, just change "Jews" to "investment bankers."

That's what a clear majority of Americans have opted for -- blowing up the economy (and themselves . . . and their friends . . . and their neighbors . . . and their children) on the off chance all those Wall Street robber barons might be reduced from obscenely rich to moderately rich.

IN THEIR FIT of pique -- and in their abject denial that their own greed might have played any role whatsoever in America's financial crisis -- ordinary Americans have turned down what Rep. John Boehner (R-Ohio), the House minority leader, called "a crap sandwich" in favor of strapping on an explosive vest.

A smart lot we Americans are. A smart lot who think the Palestinians are nuts.

If you want to put a Biblical spin on matters, maybe this is a prime example of why Jesus said we have to forgive others "70 times seven" times. Grudges and hatred make you blind -- blind to your own faults . . . your own sin . . . and your own self-interest.

Today, through our elected representatives, we've struck a powerful and wounding blow to the evil greedheads of Wall Street. We may not survive our glorious victory.

And neither may our children.

We must be so proud.

K-Doe say: Burn, Wall Street, burn!

This is a short documentary from 1990, when the (now) late, (always) great Ernie K-Doe was volunteering at Tulane University's WTUL radio, spinning the New Orleans R&B he helped make famous.

I DISCOVERED IT on the WTUL website, as I sat here in the studio, thinking I ought to add some sage observation to the Interwebs as Americans sit . . . and wait. Wait to find out how Congress is going to fix the fine mess we've gotten ourselves into, with an assist by the robber barons of Wall Street.

Wait to find out whether we're all poor now.

Wait to find out exactly how far the mightiest nation on Earth -- ever -- has fallen.

Yeah, I thought I needed to write something wise, or at least pithy, about this fine damn catastrophe waiting to swallow us all up. Is this Great Depression II? Shall we now arm ourselves, man the barricades and shoot the looters in three-piece suits?

Perhaps I could just sit at the keyboard and tell you I told you so. Whether or not I actually did.

BUT THAT'S not important now.

It seems to me -- as we tap dance on a ledge high above the abyss -- that the Fed, the Congress, the fancy bankers and the stock-exchange traders are powerless to screw up anything that particularly matters. We'll get by . . . somehow . . . with a little faith, a little orneriness and a little ingenuity.

We'll grow gardens and put in wood stoves, and we'll become a lot more "green" and a lot more local.

And we'll figure out that it ain't so bad, once you get used to it.

Screw Wall Street. Wall Street can't create an Ernie K-Doe. Or a decent R&B record.

We, if we are lucky, might figure out that our riches do not lie in our 401(k) accounts, but in our communities, in our churches and in our cultural cornucopia. We might come to see that we can be rich, even if we are poor (see New Orleans, City of).

Besides, not even Fort Knox could contain a force of nature like Ernie K-Doe, the late Emperor of the World. A pearl of great price who started out life during the last Great Depression at New Orleans' Charity Hospital.

Burn, K-Doe, burn!

Easy answers to Twitter questions

Avoiding a depression . . . at what cost?

CNBC's Jim Cramer thinks the government's plan to buy up Wall Street's problem debt just might have saved us from the Great Depression, Part 2.

WHAT I'M WONDERING, though, is whether we've avoided the abyss at a terrible cost.

Just how much money is the government going to have to just start printing now? How bad will inflation become? How much debt will foreign governments have to buy from us . . . if they will at all anymore?

How far in the hole will Uncle Sam now be, and what does that mean?

Will we have avoided another depression -- an economic cataclysm -- by closing the door once and for all on the American Century? And has that sentence been commuted, or merely temporarily stayed?

I'm no economist, and I don't know. I also don't know whether anyone does know.

AND I DON'T KNOW, either, whether our government realizes that America's fate is no longer in American hands. We have an Achilles' heel, and the world knows what it is.

We've acquired a de facto empire, the product of power and hubris . . . and maybe we've just crossed a bridge too far. We're Napoleon, and we can see the spires of Moscow, but winter is coming on fast and we've outrun our supply lines.

Suddenly, it seems to me -- And, really, what the hell do I know? -- we've come to the end of an era. Suddenly, we're no longer exceptional. Suddenly, empire is something we no longer can afford . . . if ever we could.

We're the Army-Navy game. A faded treasure of formerly great consequence, now more suggestive of stubborn pride and greater witsfulness.

Time marches on. With us or without.

Every man a schmuck

Dear America,

Congratulations! All you bastids is gonna be a big banana republic!

HAAAAAAAAA! HAHAHAHAHAHAHAHAHA!!! HAHA! HAHAHAHAHAHAHAHAHAHAHAHA!!!

We's all white trash now!


Love,

The Gret Stet of Louisiana


P.S.: Squirrels is good eatin'.

We extend greetings to our Chinese overlords

No comment is necessary on this CNBC report, I don't think.

Morgan Stanley -- one of the two last independent, U.S.-based investment banks -- is negotiating with the Chinese government for a fresh infusion of funds into the beleaguered investment bank.

Morgan Stanley CEO John Mack held various conversations with potential merger partners Wednesday afternoon including top executives at Citigroup and Wachovia Bank . However, Mack continues to work to keep Morgan Stanley an independent company CNBC has learned.

Executives at Morgan are currently crunching numbers to determine how much of an additional minority stake they need to sell to settle market fears about the company.

Mack's plan is to sell a piece of Morgan Stanley to a Chinese bank. Mack has been dealing with Chinese government officials all day Wednesday to line up money from China.

He also has been dealing with top officials from the Federal Reserve and the Treasury to lobby them to give approval to a Chinese bank increasing its stake in the company.

China’s sovereign wealth fund, China Investment Corporation (CIC), already owns 9.9 percent of Morgan. However, Mack, according to people close to the company, understands that he faces significant obstacles including a turbulent market that has crushed Morgan shares.

People close to Mack say that he does not expect any deal tonight and he would like to avoid one on Thursday. However, if he has to do a deal, because of further deterioration in stock price he will.

CNBC's David Faber had earlier reported that the Federal Reserve has been active in encouraging the Chinese to invest in U.S. financial institutions. The Fed has even made it clear that it would look favorably upon a Chinese acquisition of a U.S.-based financial institution, sources said.

Morgan Stanley stocks plunged more than 24 percent Wednesday and it is imperative that the investment bank gets a cash infusion before its shares decline further. London-based HSBC has also been cited as a possible suitor for Morgan Stanley.