David Einhorn on the rating agencies

I love this guy:

via

Jon Stewart needs to move on

As much as I've enjoyed Jon Stewart's prosecution of Jim Cramer, I'm not sure what he managed to prove except that a lot of his advice turned out to be bad. He did that pretty effectively. I hadn't realized that in addition to the bogus clip that Stewart played first (showing Cramer assuring a caller that his money was safe as a client of Bear Stearns, which it was), there were also clips from about the same time of Cramer recommending Bear stock.

Still, I have no idea what Stewart means when he chides "I understand you want to make finance entertaining. But it's not a fucking game." Besides being maybe the most cringingly unfunny thing he's ever said, what's his fucking point? That if Cramer didn't scream and have sound effects that his mother's 401k would be in better shape? Give me a fucking break.

I think CNBC appeared on Stewart's radar because of the Rick Santelli thing, when he realized, apparently all of a sudden, that the dominant financial news channel was largely staffed by super right-wing cheerleaders of corporate America. And I'm glad that he's gone after CNBC.

But the political bias of the "news" side of CNBC has nothing to do with Cramer. Yes, he has called Obama a "wealth destroyer" and talked about certain stocks being "Obama-proof," but it's somewhat tongue-in-cheek and always in the context of pitching an investment theme. He "liked" the Bush administration because it was "of, by and for the corporation," friendly to mergers, etc. But if he really shared Larry Kudlow's politics I wouldn't be able to watch the show.

Unless you're going to outlaw giving financial advice on television, I'm not sure what Cramer is supposed to do differently except stop making bad calls, which obviously no one can do. If you don't like Cramer, don't watch him! Or take the other side of the trade! I have zero sympathy for people who lost money following his advice. Or at least, no more than I have for anyone who lost money.

Stewart seems to honestly believe that Cramer bears some personal responsibility not just for the advice he's given/his failure to predict the financial collapse but for the financial collapse itself, which is intensely stupid even though it sounds plausible that such a figure would have "contributed to a frenzied environment" or whatever.

Anyway, whether or not Cramer is actually good at giving financial advice I don't think he deserves the accusation that he was recklessly endangering people's money. Stocks really had outperformed every other asset class by a wide margin for a long time, and if you've watched his show for any length of time his advice actually tends to be fairly conservative.

Cramer didn't look good when he got all indignant that a "comedian" would deign to criticize him when he didn't even know what Tier 1 capital was, but Stewart was much more the self-important, uninformed asshole in this little skirmish.

"We'll be blowing less smoke than usual this evening."

CNBC begins its 8pm special report with the anchor saying "Well we can't understate anything tonight."

What? You guys have been understating the extent of the problems? Never.

Goldilocks

Larry Kudlow cannot be a happy man these days. The guy had literally branded his macroeconomic outlook on every episode of his show in 2006 and 2007: Goldilocks. That was where the economy would slow slightly from the unsustainable recent growth (not too hot) but it wouldn't decline either (not too cold).

From his post on the Corner from July, 2007, entitled "Triumphant Goldilocks" four months before the top:

What we are witnessing here, in virtually every corner of the globe, is the success and the spread of unbridled free market capitalism. It is a dynamic worldwide march toward lower tax rates, deregulation, and, as market strategist Don Luskin put it on last night’s show, the “interconnectedness” of global economies through free trade, the free flow of capital, and the robust free exchange of information.

Do not bother asking him if unbridled free market capitalism should now take the blame. It's good enough that a majority of voters seem to.

Anyway, getting back to Goldilocks, the worse things got, the more he started personalizing her, insisting that "she" would pull through after annotating a chart showing whatever happened to be the least-damning set of economic data he could find.

Well it's clear enough now she didn't pull through. The bears ate her, and it wasn't pretty. But Larry's still putting on a brave face, waiting until they find the body (which of course they won't) before he admits she's not coming back. He's talking about his cautious optimism, just above a CNBC-imposed Wall St. Crisis: Is Your Money Safe? logo with a radioactive orange glow.