Merrill Perlman, former director of copy desks at The New York Times, presents "Business Editing in Depth: 10 Things You'd Better Know," a free, Reynolds Center webinar geared toward journalists.
For more information about training for business journalists, including free workshops and webinars, please visit businessjournalism.org.
2. Business editing can be tricky. We’ll
cover 10 things that frequently trip up
even the seasoned business pro —
and help your stock as an editor
reach record heights.
3. • About bankruptcy
• The World Bank and the IMF
• Debt vs. deficit
• Treasury securities
• Company designations
• Trademarks
• The SEC
• How to keep numbers relevant
• Rating agencies
• Stock-price reporting
4. Quiz Question #1:
What’s (probably) wrong about this statement?
Bloomberg news reports that US Airways, the
nation’s sixth largest airline by traffic, is talking
with creditors of bankrupt American Airlines,
and negotiations, thus far, have reportedly
been positive.
6. Bankruptcy
Chapter 7 bankruptcy
is for business or individuals.
•As soon as Chapter 7 is filed, debt collection
actions cease.
•A business is usually liquidated, its assets sold
to pay off creditors.
•An individual’s personal assets, such as a car
and a home, are generally protected, and the
debts are simply dismissed.
Pockets: danielmoyne/Flickr
Bennigan's: infrogmation
7. Bankruptcy
If a business files for Chapter 7,
you can say it is “in bankruptcy.”
Not “bankrupt.”
Once it’s been dissolved, you can call it
“bankrupt.” But if parts were sold, its name can
live on, and it’s no longer the same “bankrupt”
company. Ed Yourdon-Flickr
8. Bankruptcy
Chapter 11 bankruptcy is usually
for businesses.
• The business seeks protection from its creditors, so
they won’t foreclose on assets.
• The business usually continues to operate, with a
trustee appointed by the court, as it seeks to restructure
itself or renegotiate its debts.
9. Bankruptcy
Chapter 11 is not a death knell.
Many businesses emerge from bankruptcy and
go on to profitable futures.
That’s why it is crucial to say a company “has
filed for bankruptcy protection” or is “operating in
bankruptcy.” Never “is bankrupt.”
10. Bankruptcy
Chapter 13 bankruptcy
is for individuals or
unincorporated businesses.
• The individual cannot have more than about $350,000
in unsecured debt (like credit cards) and more than
about $1.1 million in secured debts (like mortgages).
• Chapter 13 works for individuals similar to the way
Chapter 11 works for corporations. The person is not
“bankrupt.”
401k-Flickr
11. Quiz Question #2:
You want to invest in a new business in a poor
country. Are you more likely to get help from
the World Bank or the International Monetary
Fund?
12. World Bank
and IMF
The World Bank and the
IMF are very similar yet very
different.
They were even formed at
the same time (Bretton Woods in
1944.)
13. World Bank and IMF
The World Bank is really a
development fund: It gives grants
and loans to poor countries.
The International Monetary Fund is
really an international bank: It tries
to keep money flowing among all its
member nations.
14. World Bank and IMF
If it makes you feel any better,
even John Maynard Keynes,
who helped found them, was
also confused by what their
roles were.
15. World Bank and IMF
The World Bank tries to lift nations
out of poverty at little or no cost to
the nations’ governments,
through loans or grants .
World Bank
16. World Bank and IMF
The International Monetary
Fund lends money, too, but
mainly to countries having
trouble with loans, debts and
other parts of their monetary
systems.
17. World Bank and IMF
Think of the World Bank as
the Red Cross and the IMF
as your rich but stern Aunt
Agatha. One won’t ask many
questions; the other will require
you to curb your lifestyle.
19. Debt vs. Deficit
The national deficit is the
difference between what the
government takes in (in taxes and
other income) and what it spends.
It’s calculated by the current fiscal
year’s budget.
20. Debt vs. Deficit
The national debt is the money
the government owes when it
borrows to cover its deficit.
Think of the debt as accumulated
deficits.
Rafiq Phillips/flickr
21. Quiz Question #4:
What’s (probably) wrong with this sentence?
The government auction of 10-year T–bills
yielding 3 percent was successful.
22. Treasuries
Treasury bills are short-term
securities, for a year or less.
Buyers get no interest during the
term; they buy T-bills at some
discount off of face value.
• For example, a one-year T-bill might sell for
$750. At the end of its term, it can be
redeemed for $1,000.
23. Treasuries
Treasury notes are
longer term, from
2 to 10 years.
They pay interest twice a year.
25. Treasuries
• The price of a note or bond at issue is
determined by its interest rate and its “yield
to maturity” (how much profit you’d get if you
held it until it matured).
• The higher the interest rate, the lower the
price.
26. Treasuries
Most government securities can
be traded.
• The interest rate does not change, but the price and
yield might.
• “Yield” and “price” move in opposite directions: The
amount you get at the end of the bond doesn’t change,
but if you pay more for a bond than it sold for originally, it
cuts into your profit, so the yield goes down.
27. Quiz Question #5:
Which of these is not a trademark?
• Jet ski
• Thermos
• Kleenex
• Frisbee
28. Trademarks
Trademarks are a company’s way
of protecting its brand
• Anyone can trademark anything (that is not
already trademarked), depending on jurisdiction,
just by putting the symbol ™ next to the product
name.
• A trademark is a lot like a copyright;
it does not have to be registered,
just declared.
29. Trademarks
Registered trademarks are stronger
legal protection of a brand.
• Registered trademarks are listed with the U.S. Office of
Patents and Trademarks.
• Only a registered trademark can use the symbol ®.
30. Trademarks
Overuse of a trademark to refer
to something not of that brand
can result in the loss
of the trademark.
• That’s what happened to aspirin,
escalator, kerosene, laundromat, thermos, zipper
and even Webster’s dictionary. Thermos: towodo/flickr
Zipper: cursedthing/flickr
31. Trademarks
If you don’t know that the thing you’re
mentioning is a brand name, use a
generic term.
• One clue: If the name is also a logo, it’s probably
a trademark.
• Search TESS (the U.S. Trademark Electronic Search
System) or the International Trademark Association
checklist for trademarks.
• Warning: Neither list is comprehensive!
33. Trademarks
What about ?
It’s still a trademark, as a noun for a specific search
engine.
As a verb, it’s still a trademark, but:
• Even its founders have used “google” as a verb.
• Some dictionaries include “google” as a verb.
It’s probably only a matter of time before Google
loses its trademark.
35. Co., Corp., Inc., LLC, etc.
All Corporations are companies.
All Companies are not
corporations.
How a business entity is formed determines
what designation it can put after its name.
36. Co., Corp., Inc., LLC, etc.
“Company” is both a generic term for any
business entity and one way of setting up
a business.
A business can also be set up as a “sole
proprietorship” or a “partnership.” Both
are simpler to set up, but can put the
owners’ personal assets at risk.
37. Co., Corp., Inc., LLC, etc.
A “Corporation” is a business that has been
set up with shareholders (even if it is not
publicly traded), to protect the owners from
being held personally liable.
38. Co., Corp., Inc., LLC,
etc.
An “LLC” is a “limited liability company.”
• An LLC is a combination of a corporation and a
partnership.
• Many small businesses are formed as LLCs.
They are more flexible than corporations, with
their shareholders and structures, but still offer
the owners protection for personal assets.
39. Quiz Question #7:
What is (probably) wrong with this sentence?
The SEC filed criminal charges against the
investor, claiming he made $5 million from
insider trading.
40. Securities and Exchange
Commission
The SEC watches over the stock, bond,
currency and other markets.
• It sets requirements for what information about a
business or investment instrument needs to
disclose, and how.
• It rose out of the stock market crash of 1929.
41. Securities and Exchange
Commission
When something goes wrong …
• While it is a law enforcement agency, the SEC makes
rules, not laws.
• It investigates allegations of insider trading, irregularities
in markets, etc.
• It cannot impose criminal charges, though it can request
that other law-enforcement agencies bring them.
42. Securities and Exchange
Commission
The SEC brings civil or
administrative actions. Many
cases are settled.
• Until recently, a company or person could settle SEC
cases that had accompanying criminal cases without
admitting or denying guilt.
• A company can still settle SEC administrative or civil
cases without admitting or denying guilt.
43. Quiz Question #8:
What is (probably) wrong with this paragraph?
Passenger traffic at JFK, LaGuardia and Newark airports
totaled some 83.9 million, up 3.6 percent from the previous
year. At the agency’s four bridges and two tunnels, total
vehicular traffic, measured in the eastbound direction only, was
approximately 118 million, a 3.9 percent increase from 1996
levels. On PATH, ridership grew 2.6 percent to about 62.2
million passengers. Overall, the agency’s gross operating
revenues rose last year by $52 million to $2.2 billion, and
operating expenses fell $8 million to $1.5 billion. Its net income
rose to $161 million, an increase of $72 million over 1996.
44. The relevance of numbers
The root of “numbers” is “numb”
• Keep in mind that many readers’ eyes just pass
over numbers.
• Limit the number of numbers you use to avoid
numbing your readers.
• Three per paragraph is a good rule of thumb.
45. The relevance of
numbers
Break large numbers down
• If, say, a report says 350,000 cars use a local bridge
each year, break it down into days.
• Take that number (about 1,000 cars a day) and compare
it to what you know of the traffic on that bridge.
• You don’t have to show the reader the math, but it could
help you spot errors.
Alex E. Proimos/flickr
46. The relevance of
numbers
Break large numbers down
• For really big numbers, come up with a comparison your
readers can digest: The wildfire burned nearly 500 square miles,
an area half the size of Rhode Island
But make sure the numbers are relevant
• Equating Bill Gates’ net worth to, say, 400,673,910 top-of-the-line
iPads is meaningless.
• Comparing something to the “size of Central Park” is irrelevant to
readers who don’t know how big Central Park is.
clearlyambiguous/flickr
47. Quiz Question #9:
The U.S. credit rating was lowered from AAA to
AA+ last year. How important is that?
48. Ratings agencies
Rating agencies are to corporate and
governmental debt much like Equifax
and TransUnion are to consumer debt.
• The higher the rating, the lower the interest rate the debt
has to offer to get people to buy it (lend money).
• The agencies investigate the issuing entity to determine
how likely it will be able to pay the interest and/or
principal on the debt or bonds it issues.
49. Ratings agencies
Standard & Poor’s
• The highest rating is AAA; its scale then goes AA, A, A.; BBB, BB,
B, etc. Ratings from AA to CCC can be modified with a + or -.
• Anything above BBB- is “investment grade,” meaning the debt is
likely to be paid off, so you can invest in it with some confidence.
• Below that is considered “speculative grade,” meaning there’s a
good chance the debt won’t be paid. Many “speculative grade” bonds
are also known as “junk bonds.”
50. Ratings agencies
Moody’s
• Moody’s highest rating is Aaa. Its scale then goes Aa, A, Baa, Ba,
B, Caa, Ca, C. Ratings from Aa to Caa can be modified with a 1, 2 or
3 to indicate how high (or low) in that category the bond ranks.
• Debt with any A rating is considered “investment grade.” Baa is
considered a moderate risk. Below that lies speculative securities.
• A C rating means there’s almost no chance any principal or interest
will be recoverable.
51. Quiz Question #10:
Which stock performed better?
Landsin jumped $14, to $154; Peach gained
$2, to $8.50; and Hermata rose $10, to $354.
52. Stock reporting
Numbers need context.
Sometimes percentages tell more
than raw numbers.
MikeBaird/flickr
53. Stock reporting
For example, the largest point drop in the Dow Jones
Industrial Average was
777.68, in 2008.
But the market was at a high then, so the percentage
drop, 6.98, was not as great.
The greatest percentage drop
was 22.61 in 1987.
The DJIA dropped 508 points
that day.
54. Stock reporting
The higher the number, the
greater the proportional change
needs to be to have an impact.
55. Stock reporting
For individual stocks, small numbers
can yield big changes.
• Apple trades around $600 a share. If it goes up or
down by 10 points, that would be a change of less
than 2 percent.
• Microsoft trades around $30 a share. If it goes up or
down by 10 points, that’s a 33 percent change.
mashable.com
56. Stock reporting
Beware of the words
• Did Apple stock “soar” by 10 points? Did Microsoft
“plunge” by 10 points?
• Make the verb match the action. A stock that gained 1
percent should not “jump” when a stock that gained 5
percent merely “rose.”
57. Stock reporting
Beware of the words
• Avoid using the word “crash,” especially when it’s a one-
day decline in the Dow.
• While there’s no real definition of a “crash,” it’s generally
considered to be a broad double-digit decline in the
market over several days.
• “Crash” has all sorts of emotional connotations. Let
experts call a “crash.”