Friday, October 31, 2008

Gray Lady Down

Last week the New York Times corporation (owner of The Boston Globe, International Herald Tribune, and 16 other daily newspapers, including the once-esteemed Gray Lady herself) reported a steep drop in third-quarter profits and print advertising. Officials blamed the problem on more subscribers going online but veteran observers noted other reasons, including the over-the-top liberalism of the Times which has disgusted readers and advertisers alike.

With the announcement, this week was bound to be full of bad news for the Times too. And it was -- the company’s stock price dropped 20% . That makes it an 80% fall just since 2004. No surprise that Standard & Poors changed its credit rating on Times' stock to category "BB-" (That's junk status, folks.) while Moody's Investors Service moved the stock's rating outlook from stable to negative.

What might this mean for the New York Times' future?

Well, economist, author, and for 28 years the editor of the financial advice newsletter, Forecasts & Strategies, Mark Skousen believes a dramatic shake-up is imminent. In fact, he predicts that the company "will be restructured, sold or privatized in less than a year," with the paper quite likely to be forced into revising (or reversing entirely) its ideological prejudices.

Here's his reasoning.