Tag Archives: Jim Cramer
The lack of wisdom in financial journalism
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Max Zeledon, a former research analyst at International Data Group in San Francisco who runs a digital consulting firm, writes about financial journalism in the wake of running across “Mad Money” and Jim Cramer on CNBC last night.
Zeledon writes, “Maybe I’m being unfair to him because he is an entertainer after all, but his network is not. His network claims to be the crème de la crème of financial reporting. That really got me thinking. It’s time to demythologize this crap.
“The job of financial journalists is to scrutinize the financial system and the players who influence it. It’s not to kiss their asses and play cheerleader to bankers and their boards. Their job is to look for corruption and ethical lapses. I’ll even dare say their job is to protect the little guy because without them she stands no chance. Take a look at political reporters. They go after politicians with purpose. But in the world of finance the scandals are not revealed until the corpse is actually bloated and the stench is too strong to ignore.
“I have a hard time seeing the same characters who missed this crisis pontificating on TV and print, preaching the same free market dogma that got us into this shithole, rewriting history while events dissolve in our minds, hoping we forget what actually happened by repeating new lies. Then there is Fox Business Network and their new brand of financial reporting. But again, I think this was meant to be an entertainment show.
“However, it’s smart guys like Charlie Gasparino and Andrew Ross Sorkin who really break our hearts because they go easy on Wall Street sociopaths simply because they are too afraid to lose their hard won access to the inner circle.”
Read more here.
Cramer's CNBC audience continues to decline
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The number of viewers tuning into CNBC‘s “Mad Money” hosted by Jim Cramer has continued to decline, according to the Zero Hedge blog.
Zero Hedge writes, “What should be more troubling for the Mad Money Maestro is that the latest Mad Money Nielsen numbers just came in. And they stink: March was the weakest month for Jim Cramer’s show in well over a year. After posting a slight improvement in February courtesy of the market’s consternation with Greece, March was a collapse. Expect many more sound effects, props, gimmicks (luckily, no incremental cleavage is possible) shortly.
“Also expect much more pro-cyclical stock advice (buy if the stock market is going up, sell if vice versa), and more big picture proclamations that are refuted within 24 hours. Also expect many more ads for male incontinence products as the show has to resort to showing increasingly “distressed” advertising inventory.
“Of course there is a much more benign explanation: people are just sick of CNBC in general. Below we present the GE business propaganda channel’s last three years of viewership data.”
Read more here.
Cramer admits advice was wrong
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CNBC “Mad Money” host Jim Cramer admitted he made a mistake when he told investors to sell stocks in the wake of the passing of the health care reform bill, writes Craig Jones of Benzinga.
Jones writes, “His first mistake was believing that the health care reform will hurt earnings of the companies. Caterpillar Inc. announced that this bill will cost them approximately $100 million, but the stock is trading near its 52-week high.
“He also thought that many money managers believed that the bill will not pass, and after realizing the mistake they would turn to panic selling. That didn’t happen either.
“Cramer also thought that the market would be sophisticated enough to realize that stocks needed to be sold ahead of the tax changes coming. But tax changes are not coming until the next year, and nobody is thinking that far away, although that would be a rational thing to do.”
Read more here.
Cramer delays pay raise, lowers bonus
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TALKING BIZ NEWS EXCLUSIVE
TheStreet.com has struck an agreement with co-founder Jim Cramer where his 2010 salary raise won’t take affect until July 1 and his potential 2010 bonus will be lowered.
According to a Securities and Exchange Commission filing, Cramer’s salary increase to $1.87 million from $1.56 million was originally scheduled for Jan. 1. But he and the online financial news site amended an employee agreement dated Jan. 1, 2008.
In addition, Cramer, who is also the host of the CNBC show “Mad Money,” agreed that his target bonus for 2010 would be $1.287 million, less than the $1.4 million — or 75 percent of his base pay — that was originally targeted in the original employee agreement.
The employee agreement also gives Cramer 22,000 restricted stock units, vesting one-third of the units each year.
Last month, TheStreet.com restated its earnings for 2008.
The filing can be read here. Here’s a 2008 post that details Cramer’s compensation history with the Web site.
TheStreet.com shares jump 27%
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Eric Savitz of Barron’s reports Tuesday on the 27 percent rise in TheStreet.com stock — 69 cents to $3.21 — due to its earnings release on Monday where it restated earnings for the past year and gave guidance for the fourth quarter. (The stock is now up 28 percent, or 71 cents.)
The rise has led to a $2.5 million increase in the value of co-founder Jim Cramer‘s holdings.
Savitz writes, “One thing that was clear from the filing is that the stock may have become artificially cheap, and as of yesterday’s close was trading below the level of its balance sheet cash. But faster than you can yell Boo-yah! the market has taken care of the problem.
“Give an assist to JMP Securities analyst Sameet Sinha, who today moved to a Market Outperform rating on the stock from Market Perform, and setting a $5 price target. Sinha notes that in addition to $83 million in cash, or about $2.37 a share, the company has net operating loss carryforwards of $128 million, with a value he calculates at about 73 cents a share. That brings you to $3.10 in assets; the stock closed yesterday at $2.52; as recently as last Thursday the stock closed at $2.22.
“Sinha set a price target on the stock of $5 — in essence, he was calling the stock a potential double. ‘After two quarters of no visibility into their financials as the company was buried under an accounting investigation (now concluded), we believe that there is inherent value in the stock,’ Sinha wrote in a note.”
Read more here.
Cramer: I expect Morrow to get well, work again
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TheStreet.com co-founder and “Mad Money” host Jim Cramer believes that David Morrow, the former TheStreet.com editor in chief who is now a business journalism professor at the University of Nevada, will conquer cancer the same way he conquered the Web site’s newsroom.
In an e-mail to Talking Biz News Thursday night, Cramer wrote, “First as I told Dave today, we aren’t done working together. I fully expect him to be up and at ‘em to edit me again soon. Why? Because he performed one miracle already — he saved TheStreet.com from oblivion and disaster and made us relevant, topical and, a rarity for any journalist, profitable. This health stuff seems easier to beat!
“Now, here’s what you need to know about Dave. At a time when journalism has been under tremendous stress and models are blowing up left and right, Dave succeeded in putting out a first-class edition every hour for years and years as a much loved and respected editor in chief. I am searching my brain to remember a minute where Dave didn’t get back to anyone within a nanosecond, and believe me there were plenty of people-including yours truly– that weren’t easy or fun to get back to. Responsive, intuitive, respectful, diligent, careful, spontaneous, rigorous, hilarious, all Dave.
“But maybe the most descriptive is CARING. He cares. About everything. He cares about integrity as much as he cares for people personally. No compromises on integrity ever but lots of accommodations for people who have difficulties or issues or face the vagaries of life on a daily basis. Why does that matter? Because it’s rare, so rare as to spin your head. The guy IS sincere, not faux sincere but actually sincere. You love working for and with Dave. HE’s that kind of guy.
“When I brought Dave in to thestreet.com it was pure chaos and anarchy. We were day-to-day. We didn’t know if the darned thing was going to come out. Within a week there was calm, and the tension was creative not cataclysmic. He brings a calm with him. He brought it to us. I envied his decision to go academic, to be able to think for more than the moment, but, more important, I envied the students who would take his course and find out what journalism in the 21st century means.
“I don’t miss Dave. No need to. He will be walking into that street.com newsroom any minute now. Why not? It’s the home he built, a sturdy and lasting home that is his lasting legacy, and, hopefully, just his first miracle.”
I echo the sentiment. Get well, Dave.
Top biz journalism events of the decade
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TALKING BIZ NEWS EXCLUSIVE
The first decade of the 21st century began with business journalists facing criticism for their boosterish coverage of companies during the tech bubble and ended with many of the same reporters facing more criticism for failing to warn consumers about the current economic crisis.
In between, the world of business journalism underwent dramatic changes that make the field only vaguely similar to what it looked like back on Jan. 1, 2000.
Talking Biz News believes the following 10 events — ranked in order of importance — were the most important to business journalism during the past decade. If you’d like to nominate another event, please post a comment.
1. The demise of the daily business section: At the beginning of the decade, standalone business sections in metro newspapers across the country were the primary source of news for those seeking information about business, the markets and the economy. As 2009 closes, they’re now an afterthought. Many of these papers have only themselves to blame — the cutting of printed stock listings and the downsizing of business news staffs have cut the quality and quantity of business news they provide.
2. The biz magazine shakeout: Goodbye Business 2.0, one of the hippest business magazines ever printed. Hello, and goodbye, to Conde Nast Portfolio. So long, Fortune Small Business and BusinessWeek SmallBiz. In addition, Inc., Fast Company and BusinessWeek were sold to new owners, Fortune cut its printed issues by 33 percent and Forbes sold a minority stake of itself. None have been able to find a new formula for success.
3. The rise of Bloomberg News: At the beginning of the decade, Bloomberg was simply another wire service that competed against the AP, Reuters, Dow Jones Newswires and the now-defunct Bridge News. Now, it has the largest staff of business journalists anywhere. It owns BusinessWeek magazine, and it’s overhauling its TV operations to compete with CNBC and Fox Business Network. The contest for business news dominance now appears to be a two-horse race between Bloomberg and Dow Jones.
4. Dow Jones sale to News Corp.: Rupert Murdoch added the parent company of The Wall Street Journal, Barron’s, Marketwatch.com and Dow Jones Newswires in 2007 to his far-flung media operations. Along with the Fox Business Network, News Corp. now has a presence in delivering business news in every major platform. The Journal has continued to grow its subscription base and has led the pack in requesting consumers pay for business news online.
5. Cable biz news wars: After CNNfn went off the air in 2004, CNBC had the cable business news market to itself for the next three years, until 2007 when the Fox Business Network was launched. Amid criticism that it was too bullish at the beginning of the decade and too defensive of Wall Street at the end of the decade, CNBC continued to dominate business news on TV.
6. Lessons learned: Yes, business journalism was asleep at the wheel in failing to provide adequate coverage of tech, Internet and telecom companies in the first part of the decade. But many biz reporters learned their lesson, and the coverage in the latter part of the decade about the housing bubble and Wall Street problems was much better. And I don’t buy the argument that financial journalism should have warned consumers what was coming; we are not fortune tellers.
7. KHOU-TV’s coverage of bad tires: This was the 2000 coverage of the Firestone problems on Ford Explorers that led to dozens of deaths, and it was a stark reminder that the best business journalism is investigative and questions companies, searching for answers when a company stonewalls. It led to an overall more adversarial approach to business journalism for the rest of the decade.
8. Jon Stewart’s takedown of Jim Cramer: Forget the back and forth between the two combatants here. Simply put, “The Daily Show” hosts montage of bad calls by Cramer put into focus what every serious business journalist knows: You don’t ever predict something, particularly involving investments or money, in print or on the air. Sadly, Cramer’s not the only one who does this.
9. Pulitzer winners abound: From the 2002 win by Gretchen Morgenson of the New York Times for her coverage of Wall Street to the 2008 win by Washington Post business columnist Steve Pearlstein and the 2009 win by Alexandra Berzon of the Las Vegas Sun, the Pulitzer committee recognized that business journalism was prescient and performed its watchdog role.
10. New delivery systems: iPhones and Blackberries now act as a transmitter of The Wall Street Journal and other major business media outlets. Twitter sends headlines of breaking news. Kindles and Sony Readers can do all and more. The newspaper is not dead as a medium of business news, but it now has more competition from a variety of options.
Stewart slamming Cramer is biz journalism moment of 2009
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Yvette Kantrow, the executive editor of The Deal, writes that the evisceration of CNBC “Mad Money” host Jim Cramer by “The Daily Show” host Jon Stewart was the most telling moment in business journalism in the past year.
Kantrow writes, “This isn’t to say the media couldn’t have done a better job covering problems in areas ranging from subprime lending to securitization to credit default swaps to private equity (though it’s hard to imagine anyone connecting all the dots to predict just how badly the world economy would tumble).
“But as critics focus on all the missed stories, from Lehman Brothers Holdings Inc. to American International Group Inc. to the real estate bubble, one issue they don’t tackle is this: Can the media effectively bridge the gap between Main Street and Wall Street? Do you do the public a disservice by claiming that you can?
“Stewart opened the door to that discussion when he took down Cramer, but so far, few have stepped inside. Too bad. Given the way the business is going, it’s far more important than asking how the media missed catching a miscreant like Bernie Madoff.”
Read more here.
Cramer gives viewers bad pick — again
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The Wall St. Cheat Sheet notes that CNBC “Mad Money” host Jim Cramer‘s recommendation to his viewers to buy Best Buy stock is now blowing up in his face.
The Cheat Sheet notes, “On last week’s Mad Money, game show host Jim Cramer told his acolytes ‘to pick up [Best Buy] BBY before Tuesday morning’s announcement.’ First, trading stocks ahead of earnings is the riskiest aspect of trading. Most professional traders close their positions ahead of earnings and decide what to do after the announcement. The reason for this risk management strategy: guessing earnings is a complete gamble.
“Enter our circus show friend Jim Cramer. While Jim is busy telling people he’s trying to make them better investors, here he is (again) giving investment advice to use the riskiest tactic in trading. Well, I am sad to say Jim’s ESP was dim, and those who started buying BBY into earnings are now getting slammed. The company missed expectations for margins, and the stock is trading down almost 7% as I write.
“As Jim says in his Stock-Picking Rules to Live By, ‘Just because someone says it on TV doesn’t make it so.’”
Read more here.
Guest slams Cramer about Goldman
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Steve Krakauer of Mediaite notes Friday that a guest on CNBC criticized “Mad Money” host Jim Cramer.
“After Cramer seemed to defend Goldman Sachs, or at least appear skeptical of their wrongdoing, Raynes got his chance to weigh in. ‘I’m pleased to be on this show, since most of your previous guests were public relations officers for Goldman,’ he said. ‘Is it ok if I’m a little critical?’
“The shot at Cramer garnered an immediate response from the Mad Money host. ‘I don’t like to hear that,’ he said. ‘I’ve blasted Goldman many times I don’t need to hear that nonsense.’
“After some more back-and-forth, Raynes continued in his mild-mannered takedown. ‘I want to remain shallow in deference to Mr. Cramer,’ he said at the end of his answer, with Burnett cutting in and interrupting. Before cutting to commercial, she said, ‘Sylvain will not be with us. Sylvain you’ve got to be more polite than that.’”
Read more here.