Seriously, you have to watch this. Jon Stewart had Jim Cramer on and it wasn't funny at all. He did the best interview on the financial crises I've seen. He must have lost a ton of money because he is pissed. And the same way he handed it to Crossfire on CNN in 2004, he just did the same thing to CNBC with Cramer sitting next to him.
A CEO lied to you, shocker. Maybe reporting involves doing some fact checking. Uncovering 35:1 leverage shouldn't be difficult.
He apologized that Cramer became the face of this while deploring the programming of CNBC.
The video isn't up yet, but it will be here. It will also be rerun on Comedy Central friday at 10am, 2pm, and 8pm ET.
5 comments:
Agreed it was intense and impressive. Almost started to feel sorry for the guy. I was annoyed, though, that Comedy Central chose to edit the interview, posting the whole thing online, as opposed to airing the complete interview last night.
The opening bit before the DS theme was great too.
BTW I'm watching the online version and see they cut out a LOT of what Kramer had to say.
Why is Stewart so mad at Cramer?
I really dont know. Perhpas Stewart needs to do a little investigative journalism and ask the following Questions before ripping into Cramer:
Did Cramer create a market where retail mortgage brokers could sell (unload) their fraudulent mortgages at no risk to themselves?
No, but Wall Street Did.
Did Cramer create exotic securities based upon these questionable mortgages; so complex in fact that the creators don't fully comprehend them?
No, but Wall Street did.
Did Cramer bully the ratings agencies (Moody's, S&P etc...) into giving these exotic financial mortgage backed securities much higher ratings than they should have (through job shopping - i.e., if you don't give us the rating we want, we will take our business elsewhere)?
No, but Wall Street did.
Did Cramer buy up massive amounts of these bad mortgage backed exotic securities, sometime using leverage in excess of 30:1, even with the knowledge that they were at best very suspect investments?
No, but Wall Street did.
Did Cramer almost cause the global financial markets to meltdown last year?
No, but Wall Street Did?
Did Cramer enrich himself with outrageous compensation over that last 5 years, much of it base on activities related to these exotic, but almost worthless, mortgage backed securities?
No, but Wall Street did.
I'll stop here.
Unfortunately, Stewart's audience is just getting more misdirection, whether orchestrated or not, that will distract them from focusing on the actual people responsible for the loss of, I don't know anymore, say 10 Trillion dollars of global wealth, simply so they could bonus themselves with billions of dollars over the last 5 years.
I suppose it's a pretty good deal if you are/were a Wall Street executive. It's a crime if you are anyone else.
Yes, the online version (particularly part 1) is much better than what was aired.
Stewart is mad at CNBC because they screwed up (this song isn't about Cramer). Journalists are supposed to report facts, not feed into bubbles. It's one thing if you have an entertainment show, it's another if you present it as news. But sure caveat emptor.
Yes the banks and financial institutions screwed up and like Cramer said, I want to see indictments. I doubt the SEC will go on Jon's show. This grew because CNBC and all of NBC responded, the government usually doesn't respond when Stewart goes after them.
Now I don't know what was legal or not. There are cycles and new ideas come along and people think the business cycle is over (I saw those articles in 2000) and then it comes back to reality. Crashes aren't always caused by illegal actions.
As best I understand, much of wall street thought the new derivatives and tranches reduced the risk of defaults. And certainly once lenders started to sell the mortgages, they had less incentive to make sure they would lend to people who could repay. And of course Congress pushed Fannie and Freddie to loan to lower income people so that more people could get into houses. Was that illegal? Wrong maybe, but I don't think illegal.
Rating derivatives of risky mortgages AAA does seem wrong and perhaps illegal, but I don't know any of the details of that (I can't name one such derivative though I know they existed).
CDSs were in part very good things. I think the extent they were used is what caused a problem, particularly as they didn't understand the house of cards all the way down to the real assets.
In software terms, how many programmers understand the OS beneath their program, or how many systems programmers really understand the hardware. Then add networks and think about security and you get software viruses. At some point this stuff gets far too complex.
While it's annoying that bank higher ups got huge sums of money, a high salary isn't illegal. We have to see what laws they broke and the SEC must get on this. I'm not sure how much of the problem was a lack of regulation and enforcement under republican rule and now I'm sure they have other things to keep them busy.
As a modicum of relief, there are no more investment banks, they all went away or got bought. But yeah, I want to see more people held accountable. The SEC should do this and as Jon points out, real news organizations like CNBC claims to be, have often helped make such investigations realities.
At least Andrew Cuomo is trying to hold bankers accountable. http://blogs.wsj.com/law/2009/03/13/judge-postpones-ruling-over-merrill-lynch-executive-bonuses/
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