CNBC's Shoutfests: Not Show Business but Serious Business

"Like a prosecutor bearing down on a decidedly uncomfortable witness, Stewart argued that the cable TV financial network--and by extension much of the business press--had given the public a false sense of financial security."

That was how CBS' Jeff Greenfield reviewed Thursday night's face-off (here, here and here) of the feuding cable personalities: Jon Stewart of Comedy Central's The Daily Show against Jim Cramer of CNBC's Mad Money.

"Business Press" is the giveaway phrase in Greenfield's description. For years now, business journalism has been a misnomer. What makes news first and foremost about national economic activity is finance. The sole certain economic tidbit to be reported each night on the nightly newscasts is the status of the Dow Jones Industrial Average.

People have jobs. Businesses engage in commerce. Importers and exporters conduct trade. Labor unions organize. Governments tax. Consumers spend. The poor are always with us. Yet the "business press" sees the entire economy through the prism of finance. Even the nightly newscasts have a bias in favor of finance. So far this year, for example, even in the depths of a recession, of the 376 stories the three networks have filed on general economic topics, almost a third (120 or 32%) have had a financial angle. CNBC, a "financial" news network, is the pinnacle of this distorted view of the economy.

The raison d'etre of a "financial" news network is to persuade its audience that the best measure of prosperity is the value of financial assets. To that end, the financial markets are assumed to be a rational, efficient and civic-minded method of assigning capital. With finance occupying the commanding heights, the real economy--labor, wages, commerce, business, trade, poverty, infrastructure--is covered by the financial networks as a secondary sideshow.

In that context, CNBC's fulsome cheerleading for a bull market--and its consternation in the face of the bear--has not been an error of judgment. It is a fact of its identity. CNBC is by nature unable to report a bubble in financial assets as bad news, even if it is fueled by lax monetary policy and reckless leverage. It is unable to report the bursting of that bubble as good news, even if that represents a return to sane levels of valuation and a productive allocation of capital.

If CNBC practiced objective journalism, with no rooting interest in the direction of stock prices, it would be an economics news network not a financial news network.

That was why Jon Stewart paraphrased Carly Simon in his Daily Show interview with Cramer: "It is not all about you." Even though the face-off was pitched as the Stewart vs Cramer Feud of the Century, Stewart's critique was against the entire CNBC enterprise.

Not that Cramer's Mad Money was let off the hook. David Muir used the following, bleeped, critique in his coverage of the confrontation on ABC next night. "I understand that you want to make finance entertaining but it is not a fucking game." Cramer justified his colleagues' Fast Money style: "There is a market for it and we give it to them." Stewart's response: "There is a market for cocaine and hookers." NBC's nightly newscast, by the way, unlike CBS and ABC did not find the Stewart-Cramer showdown newsworthy enough to cover.

Take your pick. Mad Money's mixture of bells & whistles and inside tips and carnival barker intensity is either entertaining. Or it vindicates Stewart's criticism that CNBC favors casino-style speculation at the expense of long-term investments. "How is that different from an infomercial?" the comedian inquired.

Yet we should not confuse Cramer's Mad Money antics with so much of the shouting that takes place at other dayparts on CNBC's schedule from the likes of Rick Santelli or Larry Kudlow or Dennis Kneale. Michael Calderone at Politico (in an article that quotes me) attributes the CNBC shoutfests to a house style at NBC News: "The increasingly opinionated dispatches from CNBC's stars parallels MSNBC's shift during the 2008 campaign to more aggressively opinionated commentary."

A close viewing of CNBC's market coverage reveals that the shouting stands for something more serious. As persuasive as Stewart may have seemed on Comedy Central that the recently collapsed bull market consisted of "giant piles of money going in and out and people trading them. It is transactional and it is fast but it is dangerous. It is ethically dubious" or "a Sherman's March through their companies financed by our 401(k)s and all the incentives were for short term profit and they burned the fucking house down with our money and walked away rich as hell," those insights are still vigorously challenged inside CNBC itself.

There are plenty of holdouts at CNBC who adamantly believe that high finance does--and should--occupy the commanding heights of the economy and that therefore financial journalism has the appropriate perspective on the economy at large. Growth in the real economy depends on inexpensive access to capital, subject to lower taxes and less regulation. The shouting Ludlow and the shouting Kneale are joined by the softer spoken Melissa Francis and Michelle Caruso-Cabrera, for example, in insisting that the system of financial capitalism that CNBC was founded to validate is not broken.

The CNBC shouting represents a genuine intellectual and ideological crisis at the network. The received wisdom of the last 30 years--Chicago School, supply side, laissez faire--is being challenged by the current facts on the tape. Much of the shouting is targeted at pundits, experts, analysts and correspondents, led by in-house economist Steve Liesman, who take the other side--the Keynesian, demand side, supporters of government intervention in the economy at the expense of unregulated finance.

The reason voices are raised is because the disagreement is stark and crucial. The entire neo-liberal economic orthodoxy is at risk of being discredited. If that goes, CNBC's foundational identity goes with it.

As ABC's Muir said of Stewart's questions: the "comedy show was anything but funny." Or as CBS' Greenfield concluded, it was a "very serious question the late-night comedian was raising."

Comments

[DennyCrane]

Andrew, I'm so glad you wrote this. For the life of me, I have never been able to figure out why the stock market in particular gets so much coverage. Many Americans don't own stock and of the ones who do, how many have a significant share? To many, the stock market is a playground for the rich. Sure, the rest of us have 401k funds and IRAs and so forth. But those are for far into the future when we retire. And when I turn on the evening news, I want to see news about today's economy, not expectations of the future, which is essentially what the Dow is. How bout measuring the strength of the economy in more meaningful ways? Most people don't gauge their prosperity by the stock market. They ask themselves if they're able to pay their bills, afford the things they need and want, and if they have jobs and are able to find new ones in case they lose their current ones. Whenever I watch the financial news, I see a world that I'm not a part of. For once, I'd like the news to talk about the world the rest of us live in.

[Jimboy17]

Finance is the empirical element of economics. Basically, it is nuts and bolts numbers that are easy to parade without any supporting interpretation. What has happened in the world of economics is that the culture industry that gave us edutainment has simply done the same with this garbage. Predigested and reductive sound bites regurgitated with a dog and pony in the background. It isn't news. But then again, neither is most of what parades as such in the american media these days.

[NewsWorthyBee]

Economics and finance, if I'm not mistaken they go hand-in-hand, both are co-dependant upon one another...or am I dense. CNBC is a total sham of a network. It's like the junkie offering up the news about its supplying dealer. Who's your daddy.

[Andrew Tyndall - Huffpost Blogger]

Even portraying economics and finance as going "hand-in-hand" and "codependent" would be an improvement at CNBC. At the moment, finance is presented as dominant and the remainder of the economy at its mercy.

[evaesthetic]

Which is why they focus on "fixing the banking crisis", and put little or no emphasis on stimulating the economy at large, except maybe to whine about how much it costs or hurts "productive" people.

[mjwca]

"If CNBC practiced objective journalism, with no rooting interest in the direction of stock prices, it would be an economics news network not a financial news network."

Um...problem? How can anyone legitmately separate out financial news from the economic news as a whole? To do so fails to tell the whole story and, therefore, the real story even if the emphasis is on the stock market. And that doesn't even begin to address the growing evidence that CNBC (and other media) not only had a "rooting interest" but that at least some members of the media actively participated in manipulation of the market for the benefit of their buds on Wall Street and, likely, themselves.

[Andrew Tyndall - Huffpost Blogger]

You ask: "Can anyone legitimately separate out financial news from the economic news as a whole?"

The answer is: "Of course not. Nobody can."

Hence the intellectual crisis at CNBC. After years of trying to treat high finance as autonomous of--or in control of--the real economy, the events of the last year have proven their interrelatedness.

Now comes the political question: if they are interrelated, in a democracy, which should take the leading role?

Keynesian demand-siders say the real economy trumps the concerns of financial capital and therefore government intervention is appropriate and essential. Chicago School supply-siders insist that the low-cost, low-taxed, lightly-regulated availability of capital will cure all ills and that the financial markets are still the best way to allocate it.

[scubafox]

Many thanks to Stewart for pointing out to all what's been obvious to many: the markets are gamed and corrupt thanks to a "just let the 'free market' work", "eliminate 'burdensome' regulations" philosophy: deregulation solves all.

Unless one is in on an IPO, "investing" in the stock market, isn't investing; it's speculation ... i.e., gambling. The justification is that a market for stocks provides market liquidity. That liquidity is an "emergent property" (google it) of the stock market.

This societal benefit is the result of the whole, the collective, being greater than the sum of its parts. There's a certain irony here, given that "good for society" results can come from "self-interested behavior"; it's an excellent example illustrating that there are properties of the collective that are not a feature of the parts. The irony is that economic "conservatives" and libertarians deny the existence of a collective ... there are only individuals. Yet, the core tenet of their ideology depends on just such an emergent property of the collective.

[zukervati]

A very well thought out response, thank you. What you've pointed out is really at the heart of the "individualism" that has been shoved down our throats as an antidote to socialism/­communism. The myth that the individual is better than the collective has been perpetuated in the media and lore by the very interest groups that are fully vested in exploiting the individuals. These are the same "pushers" that prey on the very "individuals", like the opportunistic hyenas that isolate their kill since charging the pack or the "collective" is not feasible. The usury, peddled by the Shylocks of the Wall St., is the root cause of all the evil and can only find its victims in individuals - not collectives.
Therefore, it isn't much of a surprise that the so called "free marketers" are so rabidly against any legislation, movement or discussion on collective bargaining, Unions, socialized medicine, etc. They keep glorifying the "survival of the fittest" theory by subsidizing TV shows or movies (take your pick of the Hollywood action genre) with targeted marketing. I suggest we dish collective punishment to these Shylocks by forcing some of the toughest regulation through the Congress!

[lagumbo]

CNBC, NBC,CNN AND FIXED NOISE [FOX] has no loyality to their viewers. They care about one thing and that's lining their pockets and doing everything they can to try and contribute to the failuer of our
President. Just like yesterday, Fixed Noise[FOX] used a campaign piece spliced together to make it seem as tho Vice-President JOE BIDEN said the our economy is sound. Did anyone called them on it. Did anyone report this on the news channels, no? Every news channels' sole purpose is to do what ever it can to try and destroy the good work PRESIDENT OBAMA is trying to do. Let's not let them get away with it. PRESIDENT OBAMA is the only one trying to fight for the little people. We must boycott these news outlets and their sponsors. If PRESIDENT OBAMA doesn't get the chance to work for the people, we will never have anyone else to do this. Let's support our PRESIDENT. I emplore Jon Stewart and Colbert to keep giving us the truth. You are all the people have for the truth.

[Nutcase]

As a former foreign correspondent, I can assure you that none of the financial channels are news organizations by any stretch of those words.

They are, purely and simply, infomercials for the Wall Street Casinos.

[williamsjw]

Ironically ....One of the primary VICTIMS of CNBC's lack of financial journalism are the owners of CNBC , MSNBC and NBC ......the GE SHAREHOLDERS. which included many pension plans and 401K's as well as many American individuals.
Since October 2007 the market value of GE has declined by about 300 BILLION$ as it's share price has declined from about 40$ per share to close to 10$ today.
This is primarily because GE's formerly highly profitable financial arm has also paid the price of the highly leveraged and a poorly regulated finanical marketplace of the past 8 years.
Had CNBC and NBC's management actually supported true financial investiagtive journalism, and had actually pointed to this pending high risk environment and called on government action to protect shareholders ......just as they now attack Obama for trying to increase taxes on the wealthy and oil Industry, they may have helped protected their own parent company from a 300 Billion dollar loss in value over the past year and half.

[JScott]

Yup perfect example of a corporate entity getting too big that one part is clueless about what the other part is doing, and this is the result.

[mjwca]

One can't assume any of the executives at the networks or many of the companies in trouble have their company's interest at heart. Unfortunately, I think it is pretty obvious they have their own short term interests at heart, company and country be damned.

[treetracker]

The question is whether or not the media (no matter who they are) will put aside their personal political agenda or ideology and actually investigate and without bias report the news.

Sorry, Walter Cronkite, Edward R. Murrow, Huntley and Brinkley and the rest have passed on. There are very few out there who have any credibility and it is doubtful those without credibility are capable of deep thought, much less have any ethics whatsoever.

I read articles which consistently contain misinformation (or outright lies) to advance the author's personal bias. Some are outright, others more subtle. And, unfortunately they mislead the public into believing something that is not true. That is not responsible journalism and their union cards should be revoked, and they should be fired.

But, they will remain the cheer leaders and our Republic will eventually go up in flames.

[JScott]

Yup I just saw a report on 20/20 (ABC) that was shamlessly biased towards Jon Stossel's politics, the OMITTED many facts and LIED about others.

[MPeter]

CNBC sells snake oil. There is no financial expert on the network. What we have are hacksters who are bought and paid for, by corporate ceos to manipolate the market. It is annoying to see such incompetents crowding out Prez Obama's message as he tries to clean up the mess they have created. CNBC needs to be shut down or, the likes of Cramer, Santelli, Batiromo and Kudlow among others, are reigned in. Their lies have quantifiable consequences...in dollars and livelihoods!!!!

[Binckeslaw]

A network that gives Larry Kudlow his own show is, like FOX, nothing more than an arm for politcal propaganda.