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Micro or Macro – it’s all the same to the rumour mill.

5 May 2010 No Comment

This article in the Independent this morning made me think;

http://www.independent.co.uk/news/business/news/world-markets-tumble-as-contagion-fears-take-hold-1962463.html.

I always find it amazing how rumours spread through our local business community – only this morning I was breathlessly told by two people that one of our clients had “gone bust”. In fact I had met with them very recently to conclude some interesting planning work and knew that they were in rude financial health. I called anyway to see if they knew that the rumours were rife – they did, and in fact could identify the source with some confidence.

There were other rumours “doing the rounds” in the city too; a well known local entrepreneur can’t make the first payment on a CVA, another has failed to make his, a business was buying something I knew to have been sold to someone else – and so it goes on. Conclusions are drawn, connections made and the rumour mill runs wild with speculation – just another day in city business.

And it’s not just word of mouth either. The proliferation of social media through networks such as Twitter, Facebook and Buzz means that rumours don’t just pass from person to person┬áany more, they spread by contagion through networked groups and become “viral”. Some local rumours are harmless, others such as the example mentioned above cost at least reputation and possibly more.

It’s obviously the same on an international stage too. To quote from the Independent;

The Spanish markets fell 5.4 per cent on talk that the country would call for an emergency loan. It forced the Prime Minister, Jose Luis Rodriguez Zapatero, to respond: “I was told something about that rumour and the truth is I give it no credit, it is complete madness.”The Spanish premier added: “These rumours can increase differences and hurt the interests of our country, which is simply intolerable and of course we intend to fight it.””

I’m not sure how much 5.4% of the Spanish market was worth or what the value change on a European scale has been. One thing’s for sure, “an unverified explanation of events circulating from person to person and pertaining to an issue of public concern” has cost someone a “shed-load of cash”.

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