With the introduction of real time press releases and news articles, more people are getting their news from online sources rather than from print. The advantage is that the information is not pre-screened and many articles that would not normally make their way into the evening news are reported on at some length.

In amongst all this data are press releases by a group of people who's job it is to present a company in the best possible light. It can be shown that there is a direct correlation between a news or press release and movement in that company's stock price. It is not that rare that an over zealous marketer overstates good information about a company and crosses the line between fact and fiction.

The problem is not limited to marketing firms. The security exchanges in recent months have been barraged with complaints of companies misrepresenting information about financial information, sales contracts, litigation proceedings, press releases, bribes, and embezzlement. The problem is so bad that just last week charges were laid against 68 individuals representing 15 companies included the CEOs at 11 of the 15 companies.

For the small investor this means having to perform extra due diligence since a series of press releases may or may not be an accurate reflection of what is happening with the company.

Raw news feeds have no secondary source cross-referencing the information before it goes to print. It is a very commonly overlooked fact that investors have to double check the source of the news feed on their own. And even though the securities commission requires a disclaimer statement at the end of each press release, the effect of such a statement on the average small investor after reading the same message time after time after time is one where the message is largely ignored.

The traditional culture of playing stocks and bonds is being changed drastically by these concerns. Most people are having to learn new techniques involving internet technologies  for research purposes from scratch.

During this time it is understandable that many firms are going to be looked at extremely closely. Loopholes in the existing procedures will end up being closed as a result of this new learning curve. Hopefully, the end result will be a better system which is more fair to both companies and investors alike, however for the short term I anticipate that many people will have to learn the hard way that due diligence is more than just reading a few articles and looking up the financial statements.