03/16/2009 12:51 pm ET | Updated May 25, 2011

Can Financial Media Democratize Investing?

Last week's showdown between CNBC's Jim Cramer and (his royal highness) Jon Stewart exposed the uncomfortable truth that major media companies, like CNBC, have failed to inform us that our 401Ks are being used to bankroll the gambling of a small group of greedy people. But how did this happen?

The world of investing is undemocratic, with the vast majority of people excluded from the process. Ordinary people, like you and me, are intimidated by the complexity of the financial markets. We pass our retirement funds over to the financial "experts", who lull is into complacency by perpetuating the fairy tale of "stocks for the long run". The vast majority of these financial professionals meant to do well, but an evil minority chose to exploit the financial illiteracy of the masses.

These hijackers hide behind the complexity of the financial market, and they can run free as long as the masses don't understand the intricacies of the financial market.

Financial media companies, the main source of investing information for the majority of Americans, chose to be entertaining instead of empowering. And by failing to empower the masses, the investing process remained undemocratic.

It's not fair to blame companies like CNBC for the crisis, but they played a part in it by dumbing down financial media.

This raises an important question. If financial media played a small part in this crisis, can we redefine its role to play a bigger part in preventing the next crisis? I'd like to think so.

The industry needs to realize that the investing process is being democratized by the massive trend toward self-directed investing, a function of the trust lost on Wall Street. Retail investors are tired of being screwed over by "experts", and they are now doing their own financial research and making the trades themselves.

If the financial media industry wants to remain relevant it should help to democratize the investing process by breaking down Wall Street's complexity, empowering people to make financial decisions for themselves. Instead of telling people what to do with their money, the industry should provide tools that make investing more interactive and accessible. A few startups like Mint, Covestor and Geezeo are pioneering this approach.

If financial media is going to become a catalyst for the democratization of investing, it will have to become more empowering, instead of entertaining. And if the investing process becomes more democratic, we take away power from the hijackers who came so close to destroying our financial future.