For a long time I couldn't understand why Weblogsinc (the blog network behind Engadget and a hundred other targeted blogs that nobody reads) hadn't started a finance-oriented blog. Well, now they have. It's called, cleverly, Bloggingstocks. Glancing at it, you can see part of the inherent problems with stock blogging. For one thing, people who are interested in investment stuff are really concerned with credibility. They may be willing to take advice from a guy that throws around chairs while blaring heavy-metal, but they want him to be a successful hedge fund manager. Looking over bloggingstocks, you'll instantly see the credibility problem at work.
There's another deeper problem. There's no shortage of ephemeral, noisy analysis of day-to-day price movements. We've criticized some of the tech blogs for feeling the need to report every time Sergey Brin sneezed. At least they're filling a niche. If you want minute-to-minute on analysis of stock movements, all you have to do is go to Yahoo! Finance and read any one of one hundred, redundant AP articles on why this or that stock went down to day, and who the day's winners and losers were.
Now, here's a post on eBay that demonstrates our problems:
It wasn't a huge percentage gainer, but at least it was in the right direction. After five trading days of losses in a row, eBay shares finally gained some lost ground today. They gained 51 cents, or 1.49%, to close at $34.73.
Seems like investors must have agreed with our morning post pointing out that eBay's stock could be a good deal here. Too bad the shares have slipped 19 cents in after-hours trading (as of 6 p.m.). But that could be temporary.
Where to begin -- "Too bad the shares have slipped 19 cents in after-hours trading (as of 6 p.m.). But that could be temporary." That could be temporary? As opposed to a permanent 19 cent after-hours move? Furthermore, what difference does a $0.19 after-hours move make?
The niche for finance blogs is in thinking longer and deeper about issues that affect the market, not in trying to out-detail the mainstream financial press. Unfortunately, Weblogsinc's competency is in pushing out a lot of short bursts on a lot of subjects, the exact opposite.