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I didn't forget about Jim Cramer
I was definitely looking forward to watching Jon Stewart maul Jim Cramer on the Daily Show last night, but I got busy having a life, and I missed it. I just watched it now, and I have to say it was a more enlightening, thoughtful discussion that I had imagined it would be.
Stewart's an impressive thinker, and extremely eloquent. To his credit, Cramer seemed to genuinely listen and consider Stewart's viewpoint and even though Cramer's position is indefensible, at least he wasn't overly defensive. Just somewhat. Here's one exchange:
Cramer: I didn't think that Bear Stearns was going to evaporate overnight. I didn't. I knew the people who ran it. I had always thought they were honest. That was my mistake. I really did. I thought they were honest. Did I get taken in because I knew them from before? Maybe to some degree....
Stewart: Honest or not, in what world, is a 35-1 leveraged position sane?
Cramer: The world that made you 30% year after year after year beginning from 1999 to 2007.
Stewart: But isn't that part of the problem? Selling this idea that you don't have to do anything... sit back and you'll get to 10-20% of your money.... when are we gonna realize in this country that our wealth is work?
Stewart just really nailed it through the whole interview. He also took Cramer to task on what CNBC's role should be:
"CNBC could be an incredibly powerful tool of illumination for people that believe that there are two markets. One that has been sold to us as long term ... put your money in 401-ks, put your money in pensions and just leave it there. Don't worry about it. It's all doing fine.
Then there's this other market, this real market that's occurring in the back room where giant piles of money are going in and out and people are trading them and it's transactional and it's fast, but it's dangerous, it's ethically dubious and it hurts that long term market. And what it feels like to us (is that) we are capitalizing your adventure.... And that it's a game that you know is going on but that you go on television as a financial network and pretend isn't happening."
You can watch the entire interview below. After that, if you're still in the mood for some Cramer bashing, you can play Jim Cramer's Crashteroids! It's a Flash game in which Cramer tries to survive against his greatest enemies. Marketplace Money host Tess Vigeland sent me the link. She says her high score is $8560... "which I think might buy me a share of Berkshire Hathaway these days."
By the way, my latest After the Bell podcast is out, which you can access here. This week, happy thoughts about the markets, the right kind of glasses for Citigroup's latest news, and we try to find the smell of greed.
Enjoy your weekend.
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This discussion between Mr. Cramer and Mr. Stewart was long over due. Mr. Cramer has a very dubious track record as an investor. In fact, Barron's has run more than one article on his skills as an investment advisor which Mr. Cramer and CNBC refuse to cooperate on. Part of the significant problem we are confronted with today in our financial markets was pointed out as early as 2005 in several publications, but were dismissed by people like Allen Greenspan, Robert Rubin, Ben Bernanke, and generally supported by the talking heads on CNBC like Mr. Cramer.
In this euphoric era of "free market capitalism", members of Congress like Joe Liebermann went out of their way to gut funding for SEC and bank regulators as a means of starving the beast and promoting the free market. Other members of Congress let them get away with it.
As a result, we find ourselves in which financial institutions do not trust each other because there is a lack of transparency in risk. This cause bank lenders to be more cautious about their liquidity. This has caused the velocity of money to slow down quite significantly. Therefore, money is harder to find than ever before.
I have been on Wall Street for 40 years. I have never seen a set of circumstances such as these. It will take us a while to get out of this mess. But to hear Mr. Cramer and the rest of the talking head crowd tell it, the Bull Market is just around the corner if President Obama would just shut up. This is the worst advice anyone could be giving at this point in time.
One final point. The average person with a high school education could master the art of investing with a years worth of study and spending 40 hours a week. Most people are not capable of spending this much time or they llack the dedication to do so. For these people, investing should be done via an investment in diversified market indexed funds limited to the US markets. Of cousre this would not lend itself to a 30 minut daly tv show.
miguel: i feel the same way. Stewart loves to bash journalists for being one sided or missing things, or 'lowering the level of discourse' and 'dumbing down america'.... meanwhile he can actively mock people night after night with silly nonsense. but his defense is always that 'i am an entertainer'. . . funnily enough that is the same excuse that rush limbaugh uses.
then Jon goes and does these 'serious' episodes of his show, acting like he is charlie rose or tim russert.. but he doesn't want to pay the price for doing that kind of show, which is to drop the cheney-vader routine and the horrible george bush impressions.
he is always talking about 'raising the level of discourse', and blasting cable news for lowering it. but what is his show? cable news shows have had to try to --act like him-- in order to --compete with him--. his show has actually become a news source, and now it has even become a news story, with various websites reporting on what was said on his show, as if it were newsworthy. talk about an echo chamber.
and what level of discourse is found on his show? he regularly calls people 'd-bags' and all sorts of other curse words. i feel like saying to him what he said to tucker carlson, 'how old are you'. he has all sorts of ridiculous analogies, and over the top ranting.
alot of it is not even funny, or does not even serve the traditional purpose of satirical comedy, which is to expose flaws and hypocrisy of those in power. jim cramer has no power. seriously. stewart is trying to crush some guy who has a tv show. tv hosts do not control the economy.
stewart pretends that he still has no responsibility, and can just be an 'entertainer', without a care in the world as to all the things that NPR or other real journalistic organizations have to care about... as though what he says has no impact or significance on how the public views issues or how kids think about the world.
i only wish he took his job, comedian, more seriously....
John Stewart is absolutely in no danger of losing his job - if you don't believe it, check his ratings. He is practically carrying an entire cable network on his narrow, but talented shoulders. If anything, he is likely fielding offers to become a news anchor, or at least a contributing reporter on 60 Minutes or the like.
You wish he would take his job as a comedian more seriously? Really? Is that a statement of philosophy or what? Do you realize the absurdity of that statement? When has anyone cried tears for an unfunny comedian? If you don't think he's funny, fine, don't watch him. Rest assured that his success or failure doesn't depend upon your opinion.
No, your true aim is not even thinly disquised. Dollars to donuts you either 1) work in the finance/banking or investment industy, 2) you are a rightwing/conservative/republican hack, or 3) you are or are related to (aligned with) another of Stewart's (gasbag) targets, like Tucker Carlson, Bill O'Reilly, etc.
I and millions of others think that Stewart is 1) very funny and 2) even more brilliant. Many think his style of humor is new, but actually it is ancient. Only the medieval court jesters could make the king laugh, and sometimes actually speak hard truths to the king and other sacred cows. I bet the targets of thsi humor didn't think such bold jesters were funny either. They also tried to close their ears to the fact that every one else in the court was laughing themselves silly.
C Jones...
your central thesis seems to be that I do not appreciate the hard and brilliant truths that Mr Stewart is putting to the king.
my point is simply to say that i dont think he, in fact, does Jest against the real kings, and that i find that real reporters have done much more brilliant work at pointing out hard truths than Mr Stewart, and I am simply bitter than they are losing their jobs while he makes millions by becoming the very thing he claims to despise.. the hybrid news/entertainment juggernaut that takes over the public discourse.
Most welcome Ken.
Like you, I had no doubts about, whether or not this was going to be politicized but all the posturing in the world isn't going to change the fact ,that this was brought on by the demonstrably false assumptions of the Friedrich von Hayek acolytes. By definition, they don't believe in government regulation nor do they believe their is any such thing as the commonweal.
A similar thing happened in my own state ,when all the politicians were up in arms about the salmonella peanut factory. Why didn't the inspectors shut it down yada, yada. This ,after decades of under funding inspection, ridiculing and legislating against any one who thought otherwise.
The irony is, this factory had done their own testing , knew their product was contaminated and made the decision to ship their product anyway. The law didn't require them to report their own findings, so it was simply a business decision. Adam Smith's blind hand in action and what should be a celebrated paradigm, for all those who have labored so hard to make it come true, is now treated like the unwanted step child.
Makes me want to stick the hypocritical politicians head into a vat of that peanut butter. Like all politicians they want it both ways.
Now, all of a sudden they have resurrected the much maligned Keynes but only in the sense that they have stuck their big toe in the water. There is an article in TNR that you might enjoy on this subject. http://www.tnr.com/story_print.html?id=b5f61f74-dde6-43ea-a433-9feb0f752c3b
One more thing about Frum. This was a guy who got fired, fairly early on ,by the Bush administration! Just think about that for a second. And for what? Because he was taking credit, for having written , one of the most idiotic phrases in the history of American oratory.
Of such things, indispensable genius, springs. Then people wonder why, the public has lost confidence in its institutions?
Thanks for taking the time to reply, Scott. I've been thinking more about this, and I realize that it's the tone and tenor, as much as the spin, that's bothering me. Obviously, conservatives are now the opposition, so they will naturally take on a negative tone. But more than a few pieces have not presented an opposing viewpoint, they have been little more than continuations of campaign attack ads. (And yes, the Democrats apparently are trying the same thing on Gov. Sanford, not that he wasn't grandstanding.) Certainly the opposition is entitled to raise doubts about administration policies. But fomenting fear and mistrust should be out of bounds.
Do keep up expanding your use of the internet to extend coverage in ways that can't be done on air. One of your limited resources is certainly on-air time, and I grant that it is difficult for the commentators to provide a fully-worked out argument in their brief few minutes. I suggest that you encourage them to post specific references, sources, or excerpts that back up their contentions (not just plugs for their books, though!)
The conservative investor types sold us a lot more than buy and hold. They've been trying to slam down the throats of honest hardworking Americans that the stock market and ou 401Ks are the answer to all that financially ails us. They've told us we can replace pensions, one of the major financial social stability concepts in the country with 401Ks. They've told us we can replace social security with 401Ks and dismantle the safety net that keeps elderly and the disabled from falling into desperate poverty. They've even proposed that the extreme costs of health care and the crisis it has produced for employers and wage workers can be solved by throwing money into this wildly unstable marketplace. Those who bought this line are now it deep trouble if they rely on their accounts. CNBC and Cramer created the impression for it viewers that it could never possibly go down, AIG, Wacova, Bear Stearns, etc. could never fail.
CNBC let the Presidents, CEOs and leaders of these companies come on their shows and LIE without any level of professional scrutiny. Jon Stewart's indictment is against all the reporters and columnists in the financial services and business press Yes, that means the WSJ, NYT and Marketplace also) that do not use the properly level of examination, scrutiny, questioning of assumptions, and checking of the facts but instead engage in backslapping, glad-handling and a$$-ki$$ing behavior that lead people in the culture of Wall Street and brokerages to believe they could do nothing wrong. All the while they were doing wrong on a devastating scale. They were screwing the pooch right under everybody's noses.
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