Thursday March 12, 2009, was the day of Brawl Street, the day of the much ballyhooed face to face brawl between Jon Stewart and Jim Cramer. Like the combined audience (they hoped) of Jon Stewart and Jim Cramer, we were ready for a full throated debate.
It never happened. Roberto Duran lasted a few rounds but Jim Cramer said “No Mas” as soon as the bell rang. It was worse than Florida destroying Ohio State in the National Championship two years ago. At least, Ohio State scored a touchdown on the first play and then folded. You simply have to watch the surrender at maneuvers, Jon Stewart first apologized and then showed clip after clip of Cramer’s mistakes. You cannot blame Stewart for this fusillade. This was the battleground Cramer had chosen.
The actual brawl on the show got so timid that Jon Stewart kept commiserating with Jim Cramer, telling him again and again that it was never against Cramer as a person. In the end, he expressed his sympathy with Jim Cramer telling him “it is unfortunate that your face is now associated with this”.
It did not have to be so. Jon Stewart, we felt, had overreached in his tirade against Rick Santelli and made himself vulnerable. Rick Santelli is no Wall Street CEO; he did not cheat anybody and he was vehemently against the bailouts of Wall Street firms. So the only reason Jon Stewart raged against Santelli was because of Jon’s role as the protector of the Obama mission.
Here was Stewart the Magnificent, the mythical cult figure, the modern day Apollo Creed from the New York media attacking a solitary, hard working, middle class Italian American trader from Chicago whose only fault was that he expressed his personal opinion in public.
Now this would have been a different fight, a fight about Stewart and his reasons for stepping into an argument between an American citizen and the American President. It was Rick Santelli’s fight.
Jim Cramer should have fought this fight for Rick Santelli, his brother and comrade in arms. He should have attacked the meanness and ferocity displayed by Jon Stewart against Rick Santelli. It was his terrain and he would have had the moral advantage of defending his teammate even when he personally disagreed with his teammate. With his knowledge, Cramer could have exposed Jon Stewart’s lack of knowledge.
Then Cramer should have defended his network. He should have pointed out the many instances in which individual CNBC people warned viewers about the risks involved. This would have been the perfect set up for Cramer to point out that he himself told his viewers to sell at Dow 11,000 even when Warren Buffett was asking people to buy. That weapon was for the killing blow and not for the initial parry.
But, unfortunately Jim Cramer did not fight this fight. He only fought for himself. Once he chose this battleground, he lost the war before he showed up on Stewart’s show.
CNBC got badly damaged in this fight and partly because there was no one to defend CNBC. We would be livid if we were a CNBC reporter or anchor. There are many responsible reporters and anchors at CNBC who try hard to add value to our investment decisions. We feel sorry for them and a little angry on their behalf.
However, it is important to state that Jon Stewart revealed an ugly truth about CNBC – it’s deeply ingrained habit of hyping risky opportunities without the slightest regard for the risks its hype poses to unsuspecting viewers. We ourselves have written extensively about CNBC’s tendencies, the habits of its anchors and the importance of watching CNBC “safely”.
We are sorry to say that, despite Jon Stewart’s condemnation, many CNBC anchors seem unrepentant and unyielding. They are at it again, this time hyping the Chinese stock market at every opportunity, seemingly oblivious to the risks of investing in China and the prospect of inexperienced American investors losing another pile of money if the rise in the Chinese market proves to be ephemeral or another bubble as some experts warn. If you watch CNBC, you cannot fail to see how pervasive this hype is.
There have been occasional negative comments from people like Larry Kudlow, Jeff Macke and Karen Finerman. Larry Kudlow has said on a couple of occasions that, according to his sources, some of the stimulus of the Chinese Government was diverted to the local stock market and that accounts for the rise in Chinese share prices. Karen Finerman and Jeff Macke have scoffed at the veracity of reports published by the Chinese Government. But, their comments have been lame and soft. In our opinion, these three people need to be very vocal about what they think about the Chinese market and the risks it poses for average, unsuspecting Americans. Otherwise, they would be judged as willing accessories to the excesses of their colleagues.
So, unless CNBC changes its behavior, Jon Stewart may have to continue his campaign. CNN’s slogan says it is “keeping them honest”. Perhaps, Jon Stewart can actually make them honest.
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