Newsgathering is a blood sport as well as a lazy man’s way to riches, or at least a steady salary. It doesn’t matter whether the reporter writes for a tiny weekly or a big city paper, a community television station or a tv network. Most stories are generated in three ways:
* A reporter has a beat and keeps up with all or most of the players in it (city hall, police, Wall Street, the local mill). When something happens, the reporter calls as many players as s/he can before deadline and writes a news story, with good solid background.
* The paper gets a wire service: NewsCorp, Reuters, AP, Al Jazeera, or whatever. When something happens that the local paper/station views as interesting/important/funny, they grab it, give it to a reporter to find and write about local links.
* If all else fails, the paper/station uses an interesting press release, re-writes it, localizes it if possible, and runs it as straight news. This is where journalistic ethics begin to blur and even disappear. Well-funded foundations, countries, movie stars, business enterprises all have PR firms, whose expert writers turn out press releases putting their clients in the most favorable light possible, or putting opponents in unfavorable light, or releases the most alarming crisis news or medical discoveries.
For a specific description of this phenomenon, check out this WSJ story: Advocate for Libya, Syria Failed to File Disclosures. This shows how this and other PR firms work for both of those countries, but may not always file proper, timely disclosures that they are doing so.
For investors, it helps to use common sense and good judgment when reading news about companies, industries and countries. And wait for further information before making up your mind. The one good thing about our free press is that the truth does (eventually) come out. You just have to figure out what the truth is.