Jim Cramer just went on The Daily Show with John Stewart. John Stewart is super sharp, Cramer is not a complete idiot. You may be wondering why I care about this, but it has a lot to do with what I do vocationally, and I believe that what Jim Cramer and his ilk does is very harmful to investors. Before I hear the commentators I wanted to give my perception of this match up.
In short, I thought John Stewart absolutely destroyed Jim Cramer. If people react like they ought, he will be fired from CNBC, and nobody will listen to him anymore. John Stewart nailed Cramer to the wall. I would have done it a little differently, but he brought out very clearly the main point that all of this hype and "stock picking" does not help individual investors, but hurts them and pads the pockets of the people who benefit from all the trading.
I think Cramer knew that he had to come on Stewart's show and defend himself. He was also trying to minimize the damage. Stewart would have none of that. Cramer wanted to get in and out without a big scene, but Stewart brought him down. His voice was shaking and the interview was very uncomfortable. He spanked him and talked to him like a child. That was one of the most humiliating things I have ever seen, and it couldn't have happened to someone who deserved it more. It will be very interesting to see how this plays out in the media and in specific for CNBC.
Thursday, March 12, 2009
Stewart versus Cramer
Posted by JB at 11:19 PM
Subscribe to:
Post Comments (Atom)
Posts
8 comments:
While I am not a fan of either of these guys one has to wonder if Stewart would be attacking Cramer so dilegently had Cramer not attacked Obama last week.
Jonathan, in this interview Stewart even criticizes long term investing. Does the man think we should save for retirement through a savings account. Just wondering what you thought about that part.
He is unclear on that point. You could take what he said as meaning that long term investors got hurt in this debacle, which is true. Everyone did. He was thinking specifically about his mother who is 75 years old- she is not (or shouldn't be) a long term investor. I guess his point is that there is a lot of mismanagement in the system and people like Cramer make things worse rather than better. I agree.
Cramer deserved it, yes. I'm with Adam about not liking Stewart. I think guys like Stewart and Colbert are dumming down news to the next generation. 99% of their audience could not tell you who the Vice President is. Nor could the Vice President tell you who the Vice President is. "Stand up Chuck! Oh, God what am I talking about! Well, they're standing up for you now."
Also, I heard a defense of Cramer today on the radio. The host said that Cramer's show runs during the day (I don't know if this is true) and that it is for day traders not for folks like us who are in it for the long haul.
Remember: this is not my defense, but the radio host's defense.
I don't think Cramer makes that point clear enough that it is for day-traders, but even so, the bigger question is "is day trading even a legitimate thing for anyone to do?" I along with the scientific research point to the fact that stock picking (no matter who you are) and market timing, does not increase your portfolio performance, but actually reduces it.
By the way Cramer's show shows at 6 pm two hours after the market closes. All of the watch dog organizations that keep up with Cramer's recommendations show that his recommendations lag the market as a whole, and when you factor in transaction costs, following his advice will cause you to significantly under perform the market.
I tried to write a longer comment, but I just kept getting mad. So I'll just leave it at this: I like what you said on your blog post, Jon. Thanks.
Post a Comment