Brian Grey wrote: "I havn't done research into why it's bad, I just know it's bad".
It can be bad because it can allow the creation of a ground loop. This basically turns the path through the shield of your cable, and the return path through the safety grounds of the equipment, into a huge transformer winding consisting of 1 turn that is shorted out. If there are any stray magnetic fields around (and there always are, as any guitarist who uses single-coils can tell you...), the stray magnetic field will induce current to flow in that shorted loop, and that unwanted shield current will couple noise into your signal conductors.
Chasing ground loops is one of the more time-consuming jobs involved in getting a studio up and running, and is one of the reasons that transformer-coupld equipment is sometimes regarded as "easier" to work with: the coupling transformer floats the ground reference for you, and with proper equipment design can help prevent the formation of a loop to begin with. This rapidly gets into a lot of equipment and circuit design issues, but the bottom line is that there should only be one ground reference for the whole rig, to the extent possible. Ground stuff in two places and connect them with a shielded cable that has both ends of the shield connected, and you're shipping noise along with your signal (or, in the oilfield, lightning and magnetic storm currents, which can _really_ get your attention)...
Intune wrote: "Does the shield need to be around each conductor" for shielded pair? The answer is very definitely no. Shielded pair used for our kind of balanced signal transmission needs a single common shield around both conductors to work properly. The whole idea of "balanced" is that both conductors experience the *exact* same electrical and noise environment (which is also why they are so precisely twisted, in good cable). Balanced transmission drives one conductor with one polarity (pin2 swings positive) and the other with the exact inverse of that signal (pin 3 swings negative). This allows the receving equipment to look at the difference between the signals on the pair (differential mode), and reject any signal that is identical on both conductors (common mode).
Here's gross oversimplification. Just for grins, imagine a balanced line that has a signal that just happens to be exactly +500mv on pin 2 and -500mv on pin 3 at some point in time. Imagine that that line runs right under a computer monitor, whose mondo deflection magnets induce +3v of noise in both the pin 2 and pin 3 lines. The receiving equipment subtracts the voltage on pin 3 from the voltage on pin 2: ((500mv signal + 3v noise) - (-500mv signal + 3v noise)). This leaves 1v of signal (500mv - (-500mv)), and 0v of noise (3v - 3v): the noise cancels itself out because it is *common* to both signals, and the equipment only cares about differential.
If you shield the conductors separately, their electrical environments will not be identical, and differentially-coupled noise allowed by the imbalance will become impossible to distinguish from the signal you're trying to send. In our example above, that might be 2.8v of noise on pin 2, and 3.1v of noise on pin 3. Whammo: you now have 0.3v of differential noise that gets added to your 1v differential signal, and there's no way to know which is which. No joy. Gotta make the environment as identical as possible for best noise rejection.
The rejection is never perfect for a whole boatload of reasons, which is why we still have to chase ground loops out. However, balanced signal transmission is a *vast* improvment over single-ended... And we didn't even need to talk about impedance (or any of that other jit that plastic-pocket-protector folks like me love so much) to get a basic handle on why. Hope that helps.
That 8750 27-pair cable is unshielded intrumentation and control cable. It's not what you want for any kind of serious audio work, so it is good that you passed on it. It'd be pretty much at home in an oilfield, though...
You'd really be surprised what a shield will do. 
