I’m sure the war in Iraq and the meltdown of our economy have many tangents, but neither would have been possible without validators from a "journalistic" class who willingly spread lies and disinformation while a lot of people got rich. The shrieking and fulminating of Marty Peretz, whose New Republic mainstreamed hawkishness within the Democratic Party, had its counterpart in CNBC’s Jim Cramer. They were both supreme hucksters who sought to intimidate and discredit critics in the most extreme terms, ideological zealots flinging feces at anyone who opposed them.
I see Glenn already beat me this morning in pointing out that the two men are not unconnected. It was Peretz who initially sought out Cramer, and the two founded thestreet.com in 1996. The fact that Cramer had been under SEC investigation in 1995 for failing to disclose that his fund owned three stocks he was promoting in his SmartMoney column was something Peretz evidently found untroubling.
By now most people have seen Jon Stewart’s takedown of Jim Cramer, where he confronts him on behalf of Americans who lost their retirement savings while Cramer cheered on the sidelines. Cramer deflects these criticisms by saying "we should have done more," and excuses himself because he was "lied to" by people like Lehman’s CEO Dick Fuld:
STEWART: The CEO of a company lied to you…
CRAMER: Shockers, stop trading.
STEWART: But isn’t that financial reporting? I mean, I guess what do you feel like is the role of CNBC?
CRAMER: Look I have called for star chambers…I want kangaroo courts for these guys. I really do, I want indictments. We’ve not seen any indictments. Where’s the indictments for AIG? I’ve told the Justice Department…here’s the way you get indictments…
STEWART: Listen, it’s very easy to get on this after the fact. The measure of the network, and the measure of the man is…CNBC could act as…you know in some ways, look. Nobody’s asking you for them to be a regulatory agency. But can’t, what…who’s side are they on? It feels like they have to reconcile…is their audience the Wall Street traders that are doing this for constant profit on a day to day, the short term…These guys at these companies were on a Sherman’s march through their companies, financed by our 401ks, and all the incentives of their companies were for short term profit. And they burned the fucking house down, with our money, and walked away rich as hell. And you guys knew that that was going on.
CRAMER: Okay, all right, I have a wall of shame. Why do I have banana cream pies? Because I throw them at CEOs…do you know how many times I have pantsed CEOs on my show?
STEWART: As Carly Simon would say, this song ain’t about you.
CRAMER: Okay, all right, you’re right. I don’t want to personalize it. But I think that we have reporters who try really hard. We’re not always told the truth. But most importantly, the market was going up for a long time. And our real sin I think was to believe that it could continue to go up a lot, in the face of what you describe — which is a lot of borrowing, and a lot of shenanigans.
Jim Cramer’s ability to act like a clown and say just about anything with a straight face is what has kept him on CNBC for so long, and like Peretz, he obviously feels that history is something to be rewritten to flatter himself.
For a reality check let’s look at Cramer from November 2007:
Anyone not familiar with what happened when the curtain was pulled back from WaMu and their lending practices can catch up here, but CEO Kerry Killinger pulled down $88 million from 2001 to 2007 by churning out loans to the riskiest borrowers with high fees attached. The money quickly went out the door to the bank’s executives. Employees described it as a "sweatshop": "garbage in, garbage out."
At the time, Andrew Cuomo had filed a lawsuit against real estate apraisal firm First American, claiming they had inflated their real estate appraisals due to pressure from Washington Mutual. He had emails to prove it. WaMu’s stock prices tumbled. This led Cramer to rail against Cuomo for being a "communist:"
“[W]itness the fact that right now, the most important man in America for the stock market – the most important man and I mean it negatively is this guy Andrew Cuomo, the New York State Attorney General,” Cramer said. “I’m getting tired of the New York State Attorney General being the most important man in America.”
Cramer compared Cuomo to his politicized predecessor Eliot Spitzer. “Cuomo’s about confiscation – genuine communist,” Cramer said. “The Chinese are capitalists, we got a communist.”
Andrew Cuomo did not mislead Jim Cramer. He didn’t lie to him. Cramer had no interest in the facts–he was trying to use a very high profile forum to intimidate Cuomo, and keep him from looking into Washington Mutual. He didn’t "try hard," and his crime wasn’t a belief that the market would continue to go up–he acted like a thug to actively discourage any investigation that could threaten the perpetuation of a huge ponzi scheme.
Cramer certainly wasn’t the only one. But his defense (such as it is) attempts to obscure the fact that like Marty Peretz, he believed his objective was sacrosanct — which justified its advancement by any means.
Peretz was recently able to buy back TNR from parent company Canwest–which is on the verge of bankruptcy–assisted, no doubt, by a personal fortune that Cramer helped him amass.
And the beat goes on.