Tuesday, December 8, 2009

Glenn Beck profits from his scare tactic advocacy of gold purchases

In the December 8, 2009 article "Glenn Beck's gold-gate problem," Brett Michael Dykes suggests Glenn Beck's scare tactic advocacy of gold purchases while being paid by a gold broker is a conflict of interest.
Yet another controversy appears to be brewing around Fox News host Glenn Beck. Some are accusing him of a blatant conflict of interest concerning his frequent on-air promotion of an investment sold by one of his main advertisers: Gold.

For some time Beck critics have cried foul over his relationship with Goldline International, a precious metals vendor that features the TV and radio host's endorsement prominently on their website. Critics charge that Beck is guilty of misleading his audience by often advising them to purchase gold in advance of the potential collapse of the value of the dollar on the world currency market, without disclosing that he is in fact a "paid spokesman" for Goldline. Beck's on-air promotion of gold, which includes advising viewers to construct "fruit cellars" and to rely on a "three G system" of "God, Gold, and Guns" in the event of America's collapse, dates back to his time as a host for CNN Headline News.

Glenn Beck also regularly talks up gold on his nationally syndicated radio show, where he often endorses Goldline during live commercial segments. Additionally, Beck has had the company's CEO on as a guest. Advertisements for Goldline are also featured prominently on Beck's own website, where he recently promoted gold in an audio clip warning of an apocalyptic future:

When the system eventually collapses, and the government comes with guns and confiscates, you know, everything in your home and all your possessions, and then you fight off the raving mad cannibalistic crowds that Ted Turner talked about, don't come crying to me. I told you: get gold.

Back in October, the liberal media company Air America made this video mocking the conflict of interest:



Beck's promotion of gold presents a potential problem for Fox News, which strictly prohibits on-air personalities from making paid product endorsements. When contacted by Daily Finance for a comment on the matter, Fox News senior vice-president for development Joel Cheatwood said the network "makes an exception for its commentators who are also radio hosts," adding that they knew upfront that hiring Beck came with the understanding that he was also a radio host and that they "had to be accepting of certain elements of that." Nevertheless, a Fox spokeswoman said that the company is addressing the matter with Beck's agent, George Hiltzik.

However, Beck, who responded to the conflict of interest allegations on his show last Thursday by saying "So I shouldn't make money?", isn't devoid of defenders on the matter. Business Insider called the controversy "nonsense," adding "there's nothing wrong with a commentator advising viewers, listeners, or readers to take positions that he is taking himself. In fact, you might wonder about the motivations of someone giving financial advice he wouldn't take himself."

In Beck's defense, some have also noted that the price of gold has spiked since he started at Fox News. Nevertheless, you can probably bet that any and all future Jon Stewart impressions of Beck will include numerous references to the virtues of gold.

4 comments:

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  3. This is a great post Dmitry. I just had one of the ‘Doh!’ moments and ran back to correct my own site before publishing my comment. You see my own comment form did not match what I’m about to advise. I get less comments than you, so never noticed any problem. I’ve changed it now anyway so here goes.


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