Wall $treet Week (W$W) was a long-running investment news and information TV program broadcast weekly each Friday on PBS in the United States. It had a host (or hosts) and guest experts participating in discussions on the stock market and focused on forecasts. The show debuted on PBS on November 20, 1970.
The program, created by Anne Truax Darlington and produced by Maryland Public Television (MPT), aired from 1970 to 2005 and was officially titled Wall $treet Week with Louis Rukeyser during the many years he hosted. Most of the underwriters throughout the show's tenure included: Martin Marietta, Lockheed (soon to merge long after stopping their share of funding), Prudential Securities (and its precursor, Prudential-Bache Securities), Primerica Financial Services, Hilton Hotels Corporation (and its subsidiary, Conrad International Hotels), Sperry Corporation, Enron Corp, Enron Foundation, Hanson Trust, Unisys, Travelers Insurance, Ameritech (before the big switch to SBC, which merged AT&T), MFS Investment Management, Oppenheimer Funds, A. G. Edwards, The Kaufmann Fund, Deloitte and Touche, The Corporation for Public Broadcasting, and all local PBS affiliates and their viewers/contributors.
In June 2002, the show was modified, dropping Rukeyser and changing the name to Wall $treet Week with Fortune. Rukeyser went on to host Louis Rukeyser's Wall Street on CNBC (cancelled on December 31, 2004 at the request of the show's host), which was also distributed to PBS stations. Wall $treet Week with Fortune, which was hosted by Geoff Colvin and former Fox News business correspondent Karen Gibbs, ended its PBS run on June 24, 2005.
Show format
Wall $treet Week with Louis Rukeyser:
Mr. Rukeyser would begin the program with a short commentary on the week's financial news, followed by a summation of market statistics.
A panel of financial analysts (usually three in number) offer their opinions on the market, and give specific stock recommendations.
The panelists would answer questions submitted by viewers. This segment always ended with Mr. Rukeyser delivering a pun-laden solicitation for letters.
Once in a while, before the final interview, Rukeyser would provided his insight on some aspects of business, such as a certain stock sector (e.g. food, medical, energy), the right choice for mutual funds, and even the best deals on various products. The most commonly repeated commentaries are: "Professor Lou's Classroom" (during the back-to-school season), "Uncle Lou Goes Christmas Shopping" (held during in December, usually on the Friday before Christmas), and "Sentiment-al Journey" (New Year's Eve).
In the final segment, Mr. Rukeyser and the panelist interview a guest expert. Over the years, the list of guests included such notables as Paul Volcker, Alan Greenspan, Ross Perot, John Kenneth Galbraith, Malcolm Forbes, Paul Samuelson, and Warren Buffett.
"TWX in 12 bars"
During Rukeyser's tenure, the program featured a distinctive theme composed by Donald Swartz entitled "TWX in 12 Bars," which featured percussion supplied by a Teletype ASR-33 machine. The opening bells of the song replicated the sound of the Westminster chimes.
New Year's Show
On the last Friday of the year, the host and panelists would appear in black tie, make market predictions and stock recommendations for the upcoming year, and review how well their predictions of one year ago fared.
Alternative format
On October 23, 1987 (the first program following Black Monday), the show dropped its regular format for a special program where Mr. Rukeyser interviewed three experts on the impact of the stock market crash.
Afterwards, the show would employ this alternative format whenever events warranted (usually once every few months).
Wall $treet Week with Fortune:
With the new hosts came a change in format:
Mr. Colvin and Ms. Gibbs present separate news reports on major stories impacting the market.
The hosts answer questions from viewers.
The hosts conduct separate guest interviews; Ms. Gibbs handled interviews related to specific investing issues, while Mr. Colvin handled interviews relating to politics and the overall economy.
A brief commentary by Mr. Colvin.
The new "Wall $treet Week Without Louis Rukeyser" was a dismal ratings flop: neither capturing a new more youthful market as PBS had intended, nor retaining the original viewers. It was soon cancelled.
Wall $treet Week Index
During its run, the show used two different indexes to predict future market trends:
From 1970 to 1989, the show used a technical analysis developed by Robert Nurock. The analysis consisted of ten separate technical indicators, each of which was assigned a value of either +1 (indicating a bullish trend), -1 (for a bearish trend, or 0 (neutral). A net balance of +5 (or higher) was interpreted as a buy signal, while a reading of -5 (or lower) was a sell signal. While the index rarely gave outright buy or sell signals, over time it was found to give an accurate forecast of the stock market.citation needed Mr. Rukeyser irreverently named the index "The Elves" (a reference to the Gnomes of Zurich), and dubbed Mr. Nurock the "Chief Elf". This index was replaced with the Elves Index after Mr. Nurock resigned from the show in October, 1989 and took the original Index with him. He left Wall $treet Week after he had an on air clash with Mr. Rukeyser and he was told by the show's producer, Rich Dubroff, that he was "not supposed to disagree with Lou."
Used from 1989 to the end of the Rukeyser era, this index was also a reading of ten indicators scored in the same manner as the Wall $treet Week Index. Instead of reflecting technical factors, the indicators now represented the personal sentiment of ten market analysts about the direction of the market over the next three months. The Elves Index had more volatility and gave more buy signals than the Wall $treet Week Index, but was not as highly regarded. In 1998, one magazine even suggested the Elves Index was more useful as a contrarian tool, citing three examples where buy signals were followed by periods of market drift or contraction.
Later, Mr. Rukeyser added an Elves Index for the Nasdaq. This index had one of the worst predictive records of any public index. There was never a sell signal that was correct and neither was there a buy signal that was correct. The Nasdaq moved in the opposite direction of the signal more than half the time.
The indexes were 'retired' by Mr. Rukeyser after 9-11. At that point, there the indexes were signalling a very strong sell signal. However, as was usually the case, it was an excellent time to do the opposite as the market rallied significantly after the initial selloff.
Show popularity
The premiere of W$W on November 20, 1970 was carried on eleven stations of the Eastern Educational Television Network. The show rapidly grew in coverage and viewers until it became one of the most popular programs on the newly created PBS network.citation needed At its peak, the program aired on over 300 stations, and claimed a viewership of 4,100,000 households, which meant more people watched W$W every week than read the Wall Street Journal.citation needed The program became a major source of profit for both MPT and PBS through underwriting support and viewer pledges (it is estimated PBS earned $5,000,000 profit annually from the show).citation needed
The Rukeyser Effect
Over the years, stock traders and analyists noted that a company touted on W$W on Friday would experience a runup in its stock price the following Monday. This phenomenon, dubbed "The Rukeyser Effect," was stated to be a further demonstration of the program's influence. However, in 1987, Prof. Robert Pari of Bentley College published an academic article in the Journal of Portfolio Management detailing the results of a study that found that stocks recommended by Rukeyser's guests on Wall $treet Week not only tended to rise in price and trading volume in the days preceding the Friday evening broadcast, peaking on the Monday afterward, but thereafter those stocks tended to drop in price and underperform the market for up to a year following the recommendation.[1] Rukeyser strongly disputed this claim, but ten years later Professors Jess Beltz and Robert Jennings published another academic article in the Review of Financial Economics reporting results consistent with Pari's original findings, and that there was "little correlation between the 6-month performance of a recommendation and the abnormal volume at the date the recommendation is made." They observed that there were differences in return performance between the recommendations of different individuals, but the market could not discern the more insightful recommendations from the less insightful. [2] Another commentator observed "It is mathematically impossible for the thirty million viewers of this show to beat the market, since they are the market."[3]
Mr. Rukeyser as host
The popularity of the show was largely due to the personality of its first host. Louis Rukeyser conducted the proceedings with a wry sense of humor and a reassuring manner that came from his belief in the long term strength of the U.S. economy and the financial markets. In 1980 Mr. Rukeyser explained his hosting philosophy to The New York Times as, "I am talking to one person, whom I regard as intelligent, with a good sense of humor, but not all that technically knowledgeable." He instructed panelists and guests not to use technical jargon and economic theories on the show, but rather talk about making money, because, "Economics puts people to sleep. Money wakes them up."
Mr. Rukeyser's dismissal
From its ratings peak in the early 1980s, W$W suffered a long steady decline in viewers due to competition from shows such as the Nightly Business Report, cable programs like Moneyline, and cable networks such as CNBC.citation needed By 2001 viewership was down to 1,500,000 households. Equally troubling to MPT was that demographics showed that the average W$W viewer was 65 years old. MPT began to discuss the possibility of updating the format in an effort to reverse these trends. On March 21, 2002, MPT announced that beginning in June the program would be renamed Wall $treet Week with Fortune, would be a collaboration between MPT and Fortune magazine, and would feature two new cohosts. Mr. Rukeyser was invited to remain with the program in a reduced role as a senior correspondent, but he turned down the offer, considering the offer amounted to a three minute censored cameo. Viewers were highly offended at Mr. Rukeyser's callous treatment and at the thought that they, likely being 65, were of no consequence to the show or to PBS itself.citation needed Many wondered what on earth MPT executives were thinking, as seniors generally have more assets and disposable income to invest and to support PBS more than any other age group.citation needed
The following evening, Mr. Rukeyser opened the telecast by announcing "A funny thing happened to me on the way to the studio this week — I got ambushed." He criticized MPT's decision to change the show format, announced that he was developing a new business program for PBS, and concluded his commentary by asking viewers to write to their local PBS station and request it carry his new show. After the broadcast MPT dismissed Mr. Rukeyser and Executive Producer Rich Dubroff. Over the next three months Marshall Loeb and Ray Brady served as guest hosts while the new format was put in place.
MPT was heavily criticized in the media for its decision to drop Mr. Rukeyser after 32 years of service.citation needed Some PBS stations reported a high volume of phone calls and e-mails of complaint concerning the format change.citation needed Many PBS affiliates, who had no advance knowledge of MPT's plans, were upset as well.citation needed Almost every single regular guest refused to appear on Wall $treet Week With Fortune.citation needed Mr. Rukeyser had not only written all of his lines, infamous puns included, but had made a long commute to Owings Mills almost every week for 32 years. He was paid very little for the program which put Owings Mills, Md on the map, and made more money for MPT than anything else.citation needed He remained loyal to PBS, repeatedly turning down lucrative offers from commercial stations and companies.citation needed
References
- ^ Pari, R. (1987). Wall Street Week recommendations: yes or no? Journal of Portfolio Management, 14, 74-76.
- ^ Beltz, J., & Jennings, R. (1997). "Wall Street Week with Louis Rukeyser" recommendations: trading activity and performance. Review of Financial Economics, 6, 15-27.
- ^ William J. Bernstein at http://www.efficientfrontier.com/ef/996/basics.htm
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