CNBC is another casualty of America's economic meltdown. But in time the journalism profession could benefit from the brutal criticism being unleashed on that network. At the heart of the controversy is the question of how so many financial industry TV pundits morphed into lapdog cheerleaders for corporate America at a time when they should have been journalists.
CNBC's Jim Cramer in the last two weeks has been vilified to the point that his TV ratings are already in the tank. The financial networks need to make the decision about whether they are journalists with a duty to investigate, or whether they want to perpetuate their image as an airtime-filler entertainment industry.
The Cramer, Larry Kudlow-styled financial pundits are now in an uncomfortable spotlight. They run the risk of forever losing their value as serious financial advisors. Without some adjustments, they will justifiably be regarded as a gang of Wall Street insiders who leveraged their credibility as severely as Bear Stearns and Lehman leveraged their entire companies.
A new story about how badly the financial networks did their jobs as journalists surfaces almost everyday. We can think of them as embedded journalists, only these reporters are being manipulated by Wall Street rather than the Pentagon. Old financial news reruns show us the story of the most revered gurus in the financial pundit business urging viewers to buy more Bear Stearns stock just weeks before that company failed. When we look back at just how pitiful TV pundit advice has been in the last few years, we see images of Kudlow as early as April of 2008 telling his viewers that the subprime mortgage meltdown was over and they should aggressively move back into the stock market.
While Kudlow day after day was babbling about the worst being behind us, the Dow continued to fall to the 7,000 range. Spend a few minutes on the Internet looking back at the pundits telling their viewers that Lehman is too big to fail or that Merrill Lynch has plenty of capital to flourish or that a 35 to 1 leveraged position is no problem for a company like Bear Stearns. There are only a few conclusions you can reach as you listen. You might conclude that a guy like CNBC's Cramer is pimping for corporate America as he stands in front of his camera screaming at the top of his voice to buy now. Advertisers, after all, like to see conviction in their pitchman.
The darker, more cynical suspicion about these TV wizards is that there was, in some cases, collusion between some pitchmen and some corporate CEO's intent on manipulating stock values. But I'm inclined to believe that most of the pundit misinformation occurred because investigative reporting in the news industry is dead. This new breed of financial TV pitchmen weren't paid to ask tough questions of the Bernie Madoff-Wall Street crowd that ran capitalism into the ground these last 10 years. Instead, responsible journalism has been replaced by the Cramers and the Kudlows put in front of a camera to entertain their misinformed viewers as they advise them on how to best squander their 401ks.
This is the shape of the real Bernie Madoff scandal. He can be put in jail for 150 years or a thousand, it changes nothing. He is just a product, the inevitable creation of an environment of corruption and negligence, a kind of enforced laxity.
In short, the regulators are no such thing. They are themselves just an extension of the stock market, an aspect of it, an arm of it. They are encouraged in this behavior by media outlets, who are also in thrall to, and committed to cheerleading, the stock market; who never tire of warning against letting regulation make the U.S. uncompetitive; who insist the free market provides its own discipline; for whom the opposite of deregulation is always “overregulation”. For this crowd, the Fed, yes that Fed, should now be given more regulatory powers. Only in the Alice in Wonderland world of the stock market could such a thing be uttered with a straight face.
Never underestimate the Power of Human Stupidity - R.A.H. (1973)
Either fire them all or discontinue the Network!
Even with some adjustments, these people have to be remembered for being insiders, even if only for a while. That this came to pass is not really all that surprising, so much cash was floating around that it was impossible to not be tainted by it, even our politicians turned a blind eye while accepting huge donations. Let us hope that our media returns to being a useful part of our society instead of the corporate cheer leader it has been.
Reforming our campaign finance laws will help reduce these corporations ability to direct our government. "We The People....", not we the corporations.
Today it's the opposite. WIth so many networks and so many hours to fill, our news has become all about analysis and punditry. In other words, people hear about events through the prism of other's opinion first, before the facts have had a chance to stand on their own.
The solution is never to return to the past, which was imperfect in its own way. But today's news is like a soap opera---emotion is everything. Today's news is dangerously unbalanced.
www.madhedgefundtrader.com.
He would be a natural there.
Good to hear you on the HuffPo. The false prophets of CNBC are revealed for the scared little rabbits that they are. They are cheerleaders for Wall Street bu they failed to mention the impending crash of the housing market and the collapse of the derivative market. When the repo market froze up last year, these folks said to hand on to your stocks. Keep your Confederate dollars they said, the South will rise again (and equities are going to rise any moment they say, Not!)
As a litigator in financial frauds, you know the truth because you see the smoking guns of fraud in discovery first-hand. The fundamentals are not sound, as John McCain and Phil Gramm stated just last year. In fact the entire world banking system is facing collapse because of its debt-based structure.
Say "hello" to Bobby. I have been a listener and a call-in guest to Ring of Fire on the issue of the attorney firings.
Opening people's eyes may make them unhappy but at least they will begin to see the reality of what our country has become and who hijacked the Constitution. Let's win it back! Just say "No" to the MSM's hyping and get the real facts about your financial future from those who don't have such a conflict of interest.
This all started with dumb as dirt entertainment news programming! News producers believe that flashy graphics, verbose commentators and buxom blondes are to be taken seriously, 30 seconds is all thats necessary to conveigh the message, and no one will notice that the talking head giving the message worked or is getting paid by the sponsor of the program. We've been done in by our own short attention spans and the idea that if something comes out of the idiot box, it must be true and factual. I'm not religious, but this is like having to choose between the Tree of Life or Knowledge, and we were dumb enough to pick from the wrong tree! Heard the facts but made the wrong decision anyway.
As they say: if you can't spot The Mark in the room, that means its YOU!
American democracy is reliant upon independent news organizations as a counter to unfettered abuses by segments of our society upon other segments. An independent press revealed the crimes of the Nixon administration. A pandering press did little to question the Bush administration in its starting an unecessary war in Iraq.
CNBC is one of the perpetrators of this financial fiasco. The Wall Street Journal and the rest of the press are also a significant part of the problem. Perhaps they all can reinvent themselves into organizations that actually report the news from those that now serve primarily to increase their respective shares of the news market.