Jon Stewart Vs Jim Cramer — Ditch CNBC for a More Sustainable Economy (VIDEO)


Photo via NY Times

The uber publicized, so-called grudge match between Jon Stewart and Jim Cramer came to a head last night when the Host of CNBC's Mad Money went on the Daily Show to defend himself from Stewart's charges that he (and his network) irresponsibly encouraged his audience to make bad investments in failing banks like Bear Stearns. In the dramatic confrontation, Stewart argues that financial news networks like CNBC helped to inflate the bubble with frenzied calls to buy more stocks, rather than doing real reporting, which would lead to better regulation of the market. If the networks heeded Stewart's call, would it lead to a more sustainable economy? Jim Cramer doesn't think so. Watch the interview after the jump.

Stewart's case can basically be boiled down to this: the financial news shows should've known better. They cavort with CEO's, emphasize entertainment, and make uninformed, unsupported investing calls—all under the guise of being financial experts. And what kills Stewart—and should kill you too—is that these people actually are financial experts. They just don't play them on TV.

One particularly painful part to watch is when Cramer discusses ways hedge fund managers can manipulate the market to their benefit—he's well aware of the games being played in the investing world. But he doesn't bother to report that reality to the public. Instead, he fuels the game by making calls for the public to buy their stocks, when he's fully capable of recognizing when they're "fomenting," or drumming up interest in their stock by giving a false impression of positive activity.

All this contributes to a volatile, less sustainable economy, where get-rich-quick is stressed over good long term investment, as Stewart points out—and the get-rich-quick idea is just a fantasy. And the financial news networks know that—but encouraging stable long term investment doesn't make for good ratings.

Perhaps the most telling part of the interview was near the end, when Stewart asked Cramer what made him think it was a good idea to continue encouraging investment, even after they should have recognized the 30 to 1 returns they were getting on investments had to be unsustainable. Cramer says simply, that that had been the case from 1999-2006, that they had continued to get those astronomical returns for years—and therefore they had no reason to believe they wouldn't continue.

But as we all know, the concept of limitless growth is absolutely unsustainable—and as Stewart all but proves in this interviews—CNBC and the other news networks coulda, shoulda pointed it out. And they still should. Instead, they fan the flames. And we get what we have here today.

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Tags: Consumerism | Corporate Responsibility | Economics

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