"Fix CNBC" activists want it to be Wall Street's cop

By Dan Gifford
22 Mar 20090
Every time I have started to write a follow-up to last week’s piece 
about the evolving Jon Stewart, Rick Santelli, Jim Cramer CNBC massacre, 
new information that altered the narrative slid in over the transom. The 
newest part of that story comes from a self described progressive 
(leftist) group called “Fix CNBC” which has seized on Stewart’s gold 
standard sophomoric schlock attacks to publicly call for CNBC to start 
being Wall Street’s watch dog instead of its public relations puppy. 
That ain’t likely to happen and some personal disclosure of my own a bit 
later will illustrate why.

Stewart Vs. Santelli And Cramer

A week ago, I took issue with the way Jon Stewart took a cheap shot on 
his “Daily Show” at CNBC’s Rick Santelli. Today, I have limited praise 
for Stewart’s skewering of CNBC’s “Mad Money” guru, Jim Cramer. If that 
seems inconsistent or hypocritical (oh gawd, not that), it isn’t. The 
difference is that when Stewart blasted Santelli, he blasted a straw man 
of his own making. Santelli did not say what Stewart led his audience to 
believe he said in order to set up his put-down of Santelli. I did not 
comment on Stewart’s general tear down of CNBC that followed his 
Santelli snark because I did not know whether Stewart had taken the 
video clips he made fun of out of context and still don’t. After that, 
Cramer went on the Daily Show for national humiliation by a Stewart who 
demanded to know why Cramer didn’t warn people to sell their stocks. 
“It’s not a fucking game,” Stewart postured. Cramer could have 
challenged that and Stewart’s other crock but didn’t.

Why didn’t Cramer point out the video clip that got played ad nauseum on 
practically every network of him screaming about impending doom in the 
financial markets on August 3, 2007 before the market bear took hold?

“He [Federal Reserve Chairman Ben Bernanke] has no idea, and these firms 
are going to go out of business and he’s nuts, they’re nuts! They know 
nothing!!!!” (about the Fed not injecting liquidity into the system).

Why didn’t Cramer talk about his October 5th, 2008 advice on the “Today 

“Whatever money you may need for the next five years, please take it out 
of the stock market right now, this week. I do not believe you should 
risk those assets in the stock market.” (stock market 30% off its highs?)

Or this one from October 20, 2008?

“Stop trading these two stocks (Fannie Mae and Freddie Mac) … this is an 
outrage … It’s very clear that someone knows what’s happening (and isn’t 
telling the public).

I dunno why Cramer didn’t come back at Stewart. On the other hand, 
opinions abound about the reason Stewart went after CNBC and Cramer in 
the first place.

“Jon went after Cramer because he hates phonies and hypocrisy,” 
according to fellow comedian Dennis Miller on Bill O’Reilly’s show.

“I heard people in Stewart’s family lost a lot of money in the market,” 
O’Reilly said to Miller. (Stewart’s older brother, Larry Leibowitz, is 
head of US Markets & Global Technology at a Wall Street firm)

“His [Cramer’s] real sin was attacking Obama’s economic policies. If he 
hadn’t done that, Stewart never would have gone after him. Stewart’s 
doing Obama’s bidding. It’s that simple,” MSNBC’s Tucker Carlson told reporter Michael Calderone. “He’s a partisan demagogue.”

The London Telegraph’s Tom Leonard has a thoroughly cynical take: “… 
chat show cross-pollination. It’s a heinous practice which, in these 
desperate broadcasting times, viewers are going to see more of. The 
strategy is simple: keep non-essential guests – film stars, politicians, 
anyone with something interesting to say – to a minimum so you can 
concentrate on other people with shows. After dipping his proboscis into 
[Jon] Stewart’s pollen, Cramer was meant to flutter home with some of 
his young viewers, curious to see what the fuss was about. Indeed, 
Cramer had just inserted his schnozzle into The Martha Stewart Show 
(another NBC show). They pounded some pastry and pretended it was Jon 
Stewart. It’s all showbiz, after all.”

Not if some of CNBC’s critics have their way.

University of North Carolina business journalism professor Chris Roush 
proposes a Joe Friday change to just the facts: “The more that CNBC 
allows its reporters and anchors to state their opinions instead of 
simply reporting facts, the more it will hurt CNBC in the long run. When 
you state an opinion and you’re wrong, you cause people to lose millions 
or billions of dollars. Stating opinion with business news is extremely 
dangerous. Stating politics in political news is not as dangerous 
because people know that the person is stating their political 
viewpoint.” Roush’s point is understandable at a time when so many are 
looking for someone to blame for their losses instead of looking in the 
mirror. But the people I see on CNBC are educated, informed people with 
generally worthwhile points to make about the companies and markets they 
cover. What’s more, they challenge each other because the facts are 
often in dispute. Turning that off, as Roush recommends, would probably 
turn off CNBC’s lights.

“Fix CNBC” wants the lights to stay on for change:

     Americans need CNBC to do strong, watchdog journalism – asking 
tough questions to Wall Street, debunking lies, and reporting the truth. 
Instead, CNBC has done PR for Wall Street. You’ve been so obsessed with 
getting “access” to failed CEOs that you willfully passed on 
misinformation to the public for years, helping to get us into the 
economic crisis we face today. You screwed up badly. Don’t apologize – 
fix it!

     CNBC should publicly declare that its new overriding mission will 
be responsible journalism that holds Wall Street accountable. As a down 
payment, we ask you to hire some new economic voices – people who have a 
track record of being right about the economic crisis and holding Wall 
Street executives’ feet to the fire.”

OK, La Mancha wannabes, mount up. But take it from one who been der, 
done dat and knows: Ya can fugget about it! Nobody can be right enough 
often enough to satisfy a herd of TV viewers chasing quick profits and 
nobody is gonna hold any Wall Street feet to the fire in any real way 
that matters. Too negative? Read on — and pay special attention to the 
interwoven tapestry of relationships.

Before joining Lou Dobbs’ “CNN Moneyline” (now “Lou Dobbs Tonight”) in 
New York, I auditioned for a spot at CNBC in 1989 on the anchor desk 
with Sue Herera, who is still there. My agent, the late great Sherlee 
Barish, said that all went well except that my reputation for exposing 
financial criminality bothered the brass and that they were concerned 
about having me in their midst. I may ask questions that would alienate 
the Wall Street biggies and business leaders they hoped to curry favor 
with. Worse, they were concerned I may find an R. Foster Winans at CNBC, 
Barish told me. Winans was The Wall Street Journal “Heard on the Street” 
columnist who leaked market moving stories to his stock trading buddies 
and inside information peddlers seemed to be everywhere.

In case you weren’t there or don’t remember the 80s paranoia, Wall 
Street had crashed, Godzilla market moving “geniuses” like Ivan Boesky 
with a “talent” for picking takeover targets that spiked in price had 
been unmasked as insider price riggers while lending institutions were 
failing because of looters like Charles “Cheating” Keating which, in 
turn, caused many businesses to close. Anyway, one particular story I 
had done, Barish said, in the midst of all that really bothered the CNBC 
boys: My expose on “MacNeil/Lehrer News Hour” that a great many of the 
businesses going under at the time were not the result of bad loans made 
to bad people who should not have gotten them (where have we heard that 
before?), but the result of the Federal Deposit Insurance Corporation 
forcing lenders to classify performing loans as delinquent and call them 
early. FSLIC Chairman M. Danny Wall demanded MacNeil/Lehrer take that 
fact out of the story I had done before it aired, but my editor, Gregg 
Ramshaw, said “no” as did his superiors, a principled stand for which I 
am still grateful. I was not grateful for the federal bullying that 
followed, but that’s a story for another time.

In any case, maybe the CNBC people had a point, because at CNN, I 
angered “The King of Wall Street” at the time, discovered that my boss, 
Lou Dobbs, had serious journalistic conflicts of interest and found 
corruption sludge at the now defunct Financial News Network.

That Wall Street king was Salomon Brothers CEO John Gutfreund of “Liar’s 
Poker” fame, and I earned his ire when I asked him about the way his 
bond traders, “The Big Swinging Dicks” as they called themselves, were 
sodomizing Salomon’s customers (and yes, there is something wrong with 
that). He was especially angry that I called him by the German 
pronunciation of his name (gootfroind) instead of the English 
translation (goodfriend) he liked. Gutfreund was no “good friend” to 
anyone, as far as I was concerned, other than his fellow financial 
sodomites. Long story short from there: Warren Buffett bought Salomon 
and fired Gutfreund, lots of lawsuits were filed, Gutfreund was banned 
from ever running a brokerage firm and CNBC still puts the sonuvabitch 
on the air as a credible “goodfriend” of investors! I’ve sent CNBC 
complained to CNBC, but whatcha gonna do? On to the Dobbs man.

Drexel Burnham Lambert of Michael Milken junk bond fame was in trouble 
when I joined CNN. How much trouble before it crashed several months 
later never completely got aired, from what I saw, because Lou Dobbs had 
a conflict. It was common knowledge that Lou wanted to be CNN’s 
president and that he was threatening to resign and take a big salary 
job at Drexel if he didn’t get it. Lou’s neighbor was Drexel’s top guy, 
Fred Joseph, the source of much reassurance that things at Drexel 
weren’t as bad as nearly everyone suspected or knew them to be. On the 
night that Drexel finally did crash, Lou told us all after the show that 
“Fred lied to me.” Maybe he did and maybe Lou was just doing his part 
all along to try and keep Drexel going for his own benefit as a viable 
bargaining tool, I certainly don’t know which. But how many people lost 
serious money because CNN’s reporting was possibly mollified by 
compromise? And this wasn’t the only example.

When I was assigned to do a story about some 1989 earnings at Shearson, 
I saw that a big insurance payment gave Shearson a bottom line profit 
even though it was losing money on its operations and said so in my 
story. The next day, there was hell to pay for saying that and Lou did a 
retraction. A week or so later, The Wall Street Journal noted the same 
thing I did and several other CNN news people took pleasure in pointing 
it out to me on the sly, always wary of Lou’s mercurial temper tantrums. 
But why would Lou do a retraction on something that was probably true, I 
wondered? Well, it did not take long to discover that Lou was being paid 
by Shearson and some other companies we were reporting on for work he 
did for them on the side. Lou fired me, but The Wall Street Journal 
somehow got hold of the story. Can’t imagine how that happened.

Barish next sent me over to Financial News Network. It was the original 
network financial news source and the one the fledgling CNBC wanted to 
challenge. Right away, I began noticing some things that did not look 
right and soon had confirmations from some in a position to know that 
CFO Steven Bolen, among others, was lining his pockets with FNN money 
and sending it to secret offshore accounts. FNN is now history.

Rest assured that what I’ve just written is only the tip of the Wall 
Street journalistic ethics iceberg that “Fix CNBC” seems to believe it 
will be able to melt. To its credit, CNBC has made efforts to eliminate 
the appearance of impropriety by forbidding its reporters to own 
individual shares of stock and drawing boundaries on the proper 
association between reporter and reportee, I’ve been told. That’s a 
notable change since the network got a black eye from the friendship 
between its star, Maria Bartiromo (an off air producer at CNN when I was 
there whose CNBC star status is well deserved, by the way), and former 
Citigroup executive Todd Thomson. Thomson flew Bartiromo on Citgroup’s 
private jet from New York to Beijing to host a party costing five 
million Citigroup dollars in 2007. It’s also a change from the time I 
watched Bartiromo coo to JP Morgan Chase Chairman Bill Harrison (my 
upper class counselor at Virginia Episcopal School) that she owned 1,000 
shares of a certain bank stock. “Maybe you should buy more,” he said. 
That may not sound like much, but Bartiromo is married to Jonathan 
Steinberg, son of mega investor Saul Steinberg. And a suggestion from 
Harrison to “buy more” could be taken as a tip and cause a large 
position to be taken. Now, what about those people who are consistently 
right and will hold Wall Street executives feet to the fire that “Fix 
CNBC” wants hired?

I’ve been closely involved in the markets since 1970, and in all that 
time I have yet to see anybody who could consistently tell a mass 
audience which specific stocks will make them money. Every generation 
has its guru that rides a trend or makes some dramatic right call 
(remember Joe Granville?), but they tend to fade away after the 
conditions that made them hot stuff change– which they do. There are 
simply too many market variables, too many ways of interpreting winners 
(today, next week, next year?) and stock calls made on TV are too public 
to keep working even if they are correct. The simple reason is that once 
too many people start buying the same stock, it tends to stop rising 
because there are too few people left to buy and too many already in who 
want to sell and protect profits. The bottom line: Jim Cramer probably 
does as good a stock picking and market education job as it is possible 
to do on TV. As for holding Wall Street feet to the fire, antagonize the 
suits too much, and they’ll stop talking to reporters and start talking 
to their lawyers about defamation of character, harassment, loss of 
reputation, tortuous interference, you get the picture.

CNBC doesn’t want that headache and neither do any other news 
organizations I can imagine, especially during these tough financial 
times. So take it from one who has been tossed off company premises many 
times and dealt with death threats from criminals of all sorts, CNBC is 
not going to start burning Wall Streeters unless it has people like my 
former news director, Jim Topping (now the retired president of KGO-TV, 
San Francisco), who knew exposing financial crime was the right thing to 
do, knew I had the goods on the crooks and was willing to stare the 
bastards down. I don’t believe CNBC has people with that sort of gut in 
management who are willing to give up their Four Seasons table or toni 
party invites in order to rake Wall Street. Neither do I believe there 
are many reporters around these days with the background or desire to 
spot legitimate fraudulent activity and expose it before law enforcement 
does. The ability to do that is not learned in business school, a 
background shared by most of the bright, articulate faces on CNBC. And 
that’s why “Fix CNBC” is probably going to have to be happy with the 
police holding Wall Street feet to the fire while CNBC shows the perp walk.