The Power Of Blogging

Everyone knows that blogging will give you super powers. I am not talking about "Wonder Twin powers activate" type powers. I am talking about the power to say what's on your mind and have a potential audience that reaches exponentially further than other no-cost publishing mediums.

Sure if you want to write a book or do something like start a magazine, you could potentially impact just as many people but it's going to cost you. What most of us don't know is that some bloggers actually have significant power. It all depends on who you are connected with or what you are connected to. What if you had the ability to effect the stock price of a major, publicly held company? Well, one industrious 18 year old did.

On his blog, this youngster fabbed up a story about Apple CEO, Steve Jobs, having a heart attack. Now normally you wouldn't think much about it. But as it turns out, the post was picked up by a CNN staffer and reported it as fact. Immediately, Apple's stock went down as much as 5.4%. The SEC began an investigation into the incident and to date, they have not been able to find any trading records that show benefit from artificially causing the stock to drop. You can bet the kid almost soiled himself when the cops came to his door and wanted to "ask him a few questions."

Another blog story about a non-existent $800 Apple laptop was picked up by the New York times. This hot little news tid-bit peaked investor interests thinking that Apple was going to be delving into the low-price laptop market. Some analysts even made up charts predicting Apple's increased market share. The result was a big spike in Apple's share price. Once Apple unveiled their new laptop lineup with prices starting at $1299, the hoax was realized and the information sent Apple's share price plummeting.

CNN Money reports that Apple, "...which had gained a record-breaking 13% on Monday and opened higher Tuesday morning, was down more than 5% by the time Jobs finished his presentation"

2 times in the last couple of months, a blogger has caused a major alteration in a publicly traded company's share price. Are these stories of how powerful bloggers have become or stories about the prevalence of sloppy journalism? And why is the market so volatile that unfounded claims by an 18 year old blogger can create so much havoc? What are your thoughts?

Oh, and did you hear that GM is introducing a new SUV that is powered by some new energy source? I think something was said about dilithium crystals? That should bolster their share price a bit.