Tuesday, April 20, 2010

The risk of rumours

BookValue
On Rumours
Cass Sunstein
( http://www.landmarkonthenet.com/)

Understanding rumours

False rumours can cause real damage to individuals and institutions, and they can harm the economy, writes Cass Sunstein in On Rumours. “If it is rumoured that a company is about to fail, stockholders might well be frightened, and they might sell. Because of the rumour, the company might be seriously harmed. Rumours can and do affect the stock market itself, even if they are baseless,” he adds.

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