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Mad Money, Legal Corruption, and the Financial Crisis: Cramer vs. Stewart in Comedy Central
By Kaufmann | March 15, 2009 5 Comments »
In this blog, and in my own research with colleagues, I have tried to bring up the serious problem of ‘legal corruption’ and ‘capture’, and also said that such legal corruption and regulatory capture did play a major role in the current financial crisis. As mentioned in my last blog entry on Obama, and in others, fortunately I am not totally alone in this, even if there are shades of difference in the arguments and evidence I bring.
- G20 Finance Ministers in Horsham, UK (de Souza/AFP/Getty Images)
Yet we still are only a few making this case. Not that we face many vocal critics against our position either. Instead, either a silent denial or quiet unease. Many pundits and policy-makers are still uncomfortable with the notion of legal corruption and capture having played an important role in the crisis. It is easier to ascribe blame to ignorance, bad decisions, or just the macro and regulatory technical failures…
Worse, when it comes to drawing the implications for next steps and for medium term reforms that are needed, most pundits and decision-makers still tend to ignore these governance issues (except for vague talk about transparency), or are at a loss in figuring out what to do next. This, in spite of the paramount importance that needs to be given to restore trust and credibility, and to build more resilient institutions.
Further, since they do not only afflict the US, these issues are yet to be seriously addressed in the G-20 summitry. Witness for instance the meeting of G-20 Finance Ministers that has just concluded in Horsham, UK, in the run up to the London G-20 Heads of States meeting that will take place in April. It is now mid-March 2009, in the midst of the crisis, and the G-20 Finance Ministers made general commitments to restore growth, avoid excessive protectionism and strengthen the financial system are in the right direction (duhh…).
Indeed, little was accomplished in Horsham in concrete terms (except for agreement on additional funds for the IMF). And the specific problems of legal corruption, capture, and misgovernance in the financial sector continue to be hidden under the rug. It is clear that the G20 will need to do better in London next month.
But then there are instances when one short event from unexpected quarters take place, one which spreads like wildfire and catches the attention of millions, leaving an impression far surpassing any summit communique. I am not referring to the prominent pictures of Madoff heading to jail (or his defrauded clients heading nowhere), though the Madoff case is emblematic, even if extreme.
I am actually referring to the Comedy Central show this past Thursday when host Jon Stewart took on CNBC financial ‘guru’ commentator Jim Cramer. It is a short segment, and well worth watching.
- Cramer vs. Cramer (or vs. Stewart…?)
In his interview, Jon Stewart does not explicitly make the link between the role of the (financial) media with Wall Street CEOs in creating a Ponzi-like scheme of monumental proportions (a.k.a. the ‘financial markets’ until a few months ago, of which one-half has been eviscerated). But the ghost of Ponzi seems to be implied in the show, both by Cramer own answers, and by Stewart’s wondering whether these financial media ‘gurus’ were actually ’snake oil’ salesmen (who peddled Bear Sterns stocks as a real ‘buy’ when it was at US $69 dollars, eleven days before its price had fallen to US $2 dollars a share…).
The notions of legal (as well as some illegal..) corruption, and the implied collusion and capture of traditional financial media with investment houses and financial institutions, are also suggested. This is so much larger than just about one Jim Cramer… It is about Mad Money (Cramer CNBC’s program) more generally, or as Stewart put, about Fast Money, about capture in the media and finance, and even if not explicit, about Ponzi and Ponzinomics.
Of course, there is also a dose of brilliantly funny entertainment in Stewart’s Comedy Central, and there is hyperbola, emotive outrage, ideological leanings. Apply a healthy discount for all that. The remaining message from the Stewart vs. Cramer episode is deadly serious.
- Fast, Bad, or Mad Money?
- All these famed CEOs lied to him?!?
Topics: Corruption, G-20, Public-Private Linkages, Regulation & Security, Rule of Law, capture, financial crisis | | 5 Comments
March 15th, 2009 at 3:39 am
[...] as stewart’s team gave the show the bite it had been lacking when kilborn ran things Mad Money, Legal Corruption, and the Financial Crisis: Cramer vs. Stewart in Comedy Central – thekaufmannpost.net 03/15/2009 In this blog, and in my own research with colleagues, I have tried [...]
March 17th, 2009 at 9:34 pm
Daniel….. I’m sure by now you’ve seen the efforts at Deep Capture to expose the corruption and captured media/regulators, etc. One of the investigators there has a new video just out detailing the takedown of Bear Stearns and Lehman via naked short selling. Using the available data, it reflects much of your efforts at demonstrating the ongoing lack of coverage and enforcement of financial laws. Here’s the link for you and your readers: http://antisocialmedia.net/
March 18th, 2009 at 6:25 pm
Stewart’s interview with Jim Cramer did indeed uncover the occurrence of media capture, though I would say that Stewart did an even better job in his initial segment on CNBC (which you can find here http://www.hulu.com/watch/60961/the-daily-show-with-jon-stewart-cnbc-gives-financial-advice#s-p1-st-i1 ).
As Stewart points out a number of times in his interview with Cramer, his beef isn’t really with Cramer personally, instead it’s with the CNBC network as a whole, which purports to be a respectable financial journalism network, yet appears to have failed in the journalism department with their coverage of the financial crisis. Instead, Stewart argues in this initial evisceration of the network, the reporters and analysts appear to be more interested in cozy relationships with CEOs than the true health of those CEOs’ businesses. These reporters and analysts have internalized the concerns of the institutions and individuals that they cover, and as a result are no longer providing the public with objective facts about what is happening, particularly with regards to the financial crisis. This internalization is clearly media capture.
When Stewart sends his voice into the upper registers in a parody of Maria Bartiromo’s surprise that CEOs are telling her that their companies are ‘doing OK,’ or his explitive response to one reporter asking Stanford (of Ponzi-scheme fame) ‘what if feels like to be a billionaire,’ you’re given humorous but truthful outrage that CNBC reporters were willing to take CEO statements and face value, and the inability or unwillingness to investigate such statements further.
CNBC may claim that ‘access’ is the key to their success, but Stewart proved that the network is nothing more than captured media. And he did it with only a TiVo and a sense of humor.
April 24th, 2009 at 1:18 pm
Jim Cramer may simply take seemingly reputable CEO’s at their word. Has he admitted to receiving a kick back or does evidence support that fact? If not, I think , in spite of his short comings, he’s taught more people about stocks and what and what not to do then any other individual ever. All of his college visits are sell outs ; He never runs from adversity; his picks have made me thousands. Period . Rich Schultz Ridgewood NJ
April 24th, 2009 at 1:19 pm
Jim’s theBest/ Fast Money is a close 2nd