Creative Destruction

| Mad Money host Jim Cramer took a drubbing from Jon Stewart on The Daily Show last night (watch online). But talk about creative destruction — at the end of the interview, Cramer accepted a challenge to take a more hard-nosed, investigative tack on his own show. Imagine if Cramer had gone on Mad Money in August of last year to deliver the same kind of withering take-down to then-Lehman C.E.O. Richard Fuld that he endured last night? Would it have made a difference in the meltdown? [%comments]


DrS

No, it would not have made a difference.
What would have made a difference was the two years leading up to August of last year. Imagine if for two years, CNBC had been telling the viewers that the record profits that the banks were enjoying were the results of market manipulation, and that it was as empty as a bubble could be. They didn't, though. They just figured if capitalists were making tons of money, all was right with the world, which contributed to keep it going.

Wally

The daily show episode came across as Jim Cramer was responsible for the entire mess of the current economy. This is really blaming an extremely small fish for what the other fish have done.

The more I watch of the Daily Show (with John Stewart) the more I can't help but notice just how black and white everything is that is viewed by the people in the audience. It is almost like the three stooges, a very predictable plot and a set punch line.

Lets look for the easiest scape goat and make fun of him. I couldn't help but feel sorry for Jim Cramer. There are so many people a lot more deserving of a drubbing than Jim.

Ben Ulfers

While I agree that Cramer took quite a verbal beating. I think the strength of Stewart's argument was pretty weak and internally inconsistent. He attacked Cramer personally and when Cramer tried to defend him self Stewart's retort was that "this song ain't about you". He derided CNBC for failing to catch madoff but then says "No one is asking them to be a regulatory agency".

All in all I thinks this is one of Stewart's worst interviews in quite a long time.

MRB

I think Cramer is in some way responsible; his show is especially popular with non-investors, middle and lower-middle class folks; people who might not be investing in the market. Many of those folks lost a bunch, and might not have had financial advice not been turned into entertainment, as Cramer himself said that he has an entertainment show.

Brandon

Stewart is becoming increasingly full of himself. But hey, if I had a live studio audience eating out of my hand every weekday, I'd probably be the same.

P

Stewart is completely intellectually dishonest at every turn.

He issues one sided attacks for the benefit of his hugely partisan audience, and when called on it, pulls out the "Oh hey, I'm just a COMEDIAN" routine.

He wants to swim in the same pool as the rest of the journalistic fish, but at the same time hold himself above its criticism. It's dishonest.

His propagandizing for collectivism is another thing entirely...

Mary Galeti

I wonder what role folks seem to think is appropriate for John Stewart and Stephen Colbert. I think the point of their shows, as well as shows like South Park by Trey Parker and Matt Stone serve as satire (a voice generally lacking in modern American dialogue). They are meant to point out the inconsistencies, incongruities and in many cases, lies, put out by corporate, media and political interest groups. They are meant to make their audience think, ask questions, and of course, get a laugh. We are in a time when many great media outlets are closing down (Rocky Mountain Times), laying off amazing journalists, and cutting editorial and longer pieces. Simultaneously, so many intricate crises are unfolding, and the American (and global) audience are desperately trying to get information, and understand. Perhaps this was the moment when someone like John Stewart could take some outlet to task for failing in their duty to question, investigate and inform. At the very least, it has sparked a national conversation about what the role of the media was in the economic meltdown (conceding that they aren't the only ones guilty of this) should have been and should be in the future. To expect an Oxford style debate/interview over the course of a 10 minute segment is an unfair criticism of Stewart. While perhaps Cramer didn't deserve all he got last night, he was the professional analyst/journalist at the table. He is the one who should be subscribing to the tenets of good journalism. More than likely CNBC or MSNBC could not have forseen, let alone prevented, the crises and meltdown of the US economy. However, perhaps we should have been hearing more stories from them. Why didn't we hear more about Madoff when reports were being submitted about his questionable practices to the SEC? Why didn't they dig deeper into the questions of over-leveraged banks ? These are reasonable questions - and to be honest I'm sad that this discussion had to happen at Comedy Central, and not a major news network. At the very least, I applaud the folks at the Daily Show for not backing away from the fight, and Jim Cramer for taking on the challenge as well. My only hope is that this discussion leads many in the mainstream media to ask themselves if they are really fulfilling their role as the fourth estate

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Jonathan Baird CFP(R)

John Stewart is a layman, and I didn't agree with every charge levied against CNBC and Cramer. They didn't know this was going to happen, but they do fuel the fire of the lie of stock picking, market timing and subsequent market out performance. Cramer (and those like him) harm innumerable investors with their antics. Stewart was exactly right when he said that all of the hype and market manipulation exacerbated by Cramer and co, hurt long term investors and they especially hurt day traders who think that stock picking is a winner's game.

How can anyone possibly defend Cramer after watching the video that he did on thestreet.com? He was basically confessing to market manipulation. The SEC ought to nail him and CNBC ought to fire him and every other "finance guru" that claims they know what the market is going to do. 2 years ago when I saw that video, I figured that would come back to bite him in a big way. I'm glad it did.

People who truly believe they can outperform the market in the long run need to have their heads examined and simply look at the scientific research of Eugene Fama, Ken French, Burton Malkiel, and David Booth. For a simple example look at Bill Miller's 15 year record smashed to bits in one year. The hubris that goes along with stock picking is the worst enemy of investors. They make one right call and then they think they've got the market figured out. All of the talking heads only ensure that randomness will remain in the market.

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McAllister Bryant

The interview got to the very crux of the issue. Entities such as CNBC, which make their MONEY by selling advertising to financial institutions acted as a cheerleader for the financial sector which poured millions into their own coffers.

Santelli, Cramer, Kudlow and others provided years of advice either oblivious to the technicals or fully cognisant of them, all the time selling advertising slots on their shows and touting access to the folks in power.

They knew, but telling the truth to the viewers would have meant turning on their advertisers and admitting to the failures of the system that made them rich.

I believe that is gross conflict of interest.

And why doesn't CNBC President Mark Hoffman have an email address available for the public?

charles

Stewart obviously hasn't read enough.

Rob

Stewart was pretty clear on where he lays the blame: not with any one particular pundit, but with the entire "business media", who passed themselves off as journalists but held themselves to absolutely no standard of journalism, in terms or either truth or ethics.

Political/current-event journalists aren't regulatory agencies, but they are expected to do more than regurgitate information, and it simply isn't tolerated for a journalist to unashamedly trumpet claims they know to be false. That's the difference between journalism and propoganda.

Stewart explicitly avoided attacking Cramer for the state of business journalism, but did use clips to demonstrate:

1) CNBC held Cramer up as a trustworthy source of unbiases analysis.

2) Cramer did nothing but relay propoganda from Wall Street.

3) Cramer knew exactly how he was being used by Wall Street, but chose to go along with it anyway.

The trouble isn't that Cramer did his job. The trouble is the network created such a job in the first place.

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Jocelyn

It's not that CNBC is responsible for the meltdown, but they aren't innocent. Jim Cramer touted his advice as sound (In Cramer We Trust), and coming from CNBC you'd think he would have some accountability for fact checking. Like Stewart said last night, they're both snake oil salesmen, but at least one of them is honest about it.

Bart

After watching last night's show, I have come to a sobering conclusion. The market is run by few, above the law tycoons, who do not play by the rules. Jim Cramer, who i respect dearly, went on the daily show, lied numerous times. Stewart proved it, with his clips. Jim Cramer seemed remorseful, however it makes you wonder who's side is he on? He lied on the show, once he got caught he confessed half heartedly, tried to lie agian, and got caught yet again. Makes you wonder, will the wall street elite ever learn?

In simple terms it is not fair to the American public to be manipulated by naked short sellers. They do not have to play by the rules which individual investors have to follow. Imagine what would happen if you were to manipulate the market, you'd be thrown in jail for fraud. Yet these funds get away with it. It's time to wake up, and look at the philosophy of the market.

Mind boggling how so many people still support Cramer. To those who do: He lied, it was proven, yet people still choose to defend him. Good luck with that, and your 401k.

I'm hitting up Slausson!

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C. Larity

Call the waaaahmbulance. Individual investors shouldn't try to beat the market with individual stocks anyway. Those who followed a meat-and-potatoes Vanguard strategy of just investing in the broad market and then getting more conservative as you age have come out of this just fine.

Why is this story getting so much play? Who cares that a comedy show decided not to be funny for a night? If anything, we should be outraged that a comedy show intentionally avoided being funny.

asmart

Although I enjoy Jon Stewart's satire, he clearly brought a gun to a knife fight last night. I couldn't help but feel a little sorry for Cramer. It was a thorough and relentless undressing that should have been reserved for broader, more systematic ills of society.

Evan

Why should all of our livelihoods be dependent on like 5% of the populations' willingness to invest. What is to stop the majority from centering power around the middle of the country...so that the top 5% have to come to us?

CNBC is the tip of the iceberg. Jon might not have an advanced grasp on the economy, but who does? Most of the experts on TV are cheerleaders. The entire economics discipline is practically a fancy academic rationalization for why social relationships are structured the way they are in this country.

Money is power. Proximity to people with money shifts power. That must be called into question. Whatever we've gots to do to make the majority less dependent on the minority of the opulent, we should do.

D. Johnson

Cramer was far too contrite. There's penty of blame to go around to lots of people and institutions, and there's just no way anyone would have been interested in watching the sort of show Jon thinks CNBC should have been airing.

Let's see...I could watch some buzzkill talk about how the Fed, the ratings agencies, the GSEs, prop traders at i-banks, mortgage brokers, insurance companies, regulators and individual borrowers are collectively driving the economy toward collosal meltdown, OR I could watch 30Rock and reflect on the 15% annual appreciation in my home over the past 5 years.

Does anyone honestly think that show would be on the air for more than about 3 weeks? That stuff is interesting now, but it wouldn't have been to anyone at the time.

Paul

The disturbingly sad fact here is not that 'Jon Stewart this' or 'Jim Cramer that' ...It's that it had to happen at all! Our nation's financial situation is so dire and everyone is sidestepping issues of fault/solution that it comes down to a talk-show host on basic cable to even begin to point out the multifaceted flaws of our economic structure. Agree or disagree with Mr. Stewart, but you surely must admit that his earnestness in last night's interview far outweighed Mr. Cramer's bumbling, half-hearted attempts to defend the journalistic status quo.

Ultimately, at the heart of the crisis is this: We were lied to. However, when we were making money and being promised wealth, we were willing to believe the lie. Now that the lie has been exposed, we want our money back and retribution from the liars. We won't get either.

Russ M

Seems like Ben and Wally don't understand the nature of this interview. Stewart never meant to make this about Cramer -- he was simply the one to take the bait. Stewart made it clear several times in the interview that Cramer was focusing too narrowly on the nature of the discussion.

This entire issue is not necessarily about fault, who-said-what, or who won the "showdown." This is about the role of financial "news" on television and the degree to which they either dig deep for truth or cheer blindly for greed. From what I've seen over the past year, no one has raised this argument or given it any sort of credence. Until Stewart, of course.

Granted, the issue of CNBC's failure to uphold journalistic integrity is not necessarily as important as others in this big mess, but you bet it's essential to understanding how our financial system moves forward and learns from its mistakes. And it's a complex a problem as any; the ramifications it has on journalistic access and the psychological drive of the market are both unclear and unsettling -- not to mention cable ratings, which, unfortunately, is likely the impetus behind CNBC's penchant for shying away from the focus on "boring" financial statistics and analysis. Cramer admitted as much in the Stewart interview.

There is so much to be angry about these days...so much...

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Lisa Kathryn Alyn

I would like to see them talking about how to get out of this mess rather than throwing blame. Hind sight always has 20/20 vision. We need to look forward now.