Consider the following:

Dow absorbs biggest one-day loss in history: 777.68 points

Stocks plunged yesterday with the Dow Jones industrial average falling nearly 780 points—the biggest one-day point drop ever—after federal lawmakers failed to pass a $700 billion plan to bail out the financial system.

Nick Gillespie gives a useful insight to why headlines that are true, like the above, don’t necessarily give an accurate impression to the reader:

If [the amount of the drop in the market] is not expressed in percentage terms, it is absolutely useless. Indeed, for most of its existence, the [Dow Jones industrial average] couldn’t have dropped 780 points because the index wasn’t that high.

So what is the figure in percentage terms, and how does that compare in stock market history?

The Dow’s 7 percent decline was the 17th biggest percentage drop in its history, well below the more than 20 percent drops seen in October 1987 and the Great Depression. [My emphasis.]

In other words, yesterday’s drop in the stock market would need to have been three times more considerable to have matched the two biggest losses in US history, a fact you’d never have gleaned by reading, “Biggest one-day loss in history.”

Why does this stuff matter? It matters because markets are speculative. Investors react to stories like this, sometimes by panicking, and thus the way the news is reported directly affects the very thing on which they’re reporting. On a subject of this gravity, that’s in nobody’s best interest.