Jon Stewart & Jim Cramer - Economic Discussion

[nates1984]

http://www.thedailyshow.com/full-episod ... eId=220533

Heyas, just droppin' in to say watch this.

[CidIII]

Jim Cramer got owned, nub.

[Archael]

I love jon stwewtert

[CidIII]

The crooked bastard deserved the ass-beating he received.

[Piercewise]

I've watched this three times now, and here's my take on it. WARNING: this is a long analysis from a business major, meaning tl;dr is possible.

First off, Cramer has balls. He walked into hostile territory knowing what was coming his way. Maybe Stewart's intensity surprised him a bit (it surprised me), but he had to have realized what he was getting into. He was very clear on his own failures and adament that he wants the same thing as any stockholder.

Second, Stewart served as a mouthpiece for burned investors more than a host. You can see the change occur around the 14-15 minute mark (going by the Daily Show's online clip) when he says "It's not a fucking game." Sure he's right, and he has audience support, but after that he pretty much says whatever he wants while Cramer stumbles through a few answers.

Third, Stewart is dead-on with both his wit and his candor. Lest you think I'm being too lenient on Cramer, I will say that Stewart's points are quite valid. Many professionals in the industry knew exactly what they were doing before this crisis hit, and didn't care. Many executives destroyed their companies in the short term to make money on stock options and other perks in the short run. And many stock brokers cared more about their own compensation than the health of the funds under their management. The only thing that, I believe, no one really understood was just how much could collapse in a few weeks - markets, loans, banks, even entire financial management firms simply ran out of money and were gone.

Fourth, both parties refrained from personalizing the issue. Cramer many times tried to justify his own actions, only to have Stewart correct him and say that Cramer wasn't the focus of his ire. Originally I didn't see it this way, but upon multiple viewings I realized that Stewart was quite good about stressing that point. Cramer's responses were only natural, of course; he was on the hot seat, and couldn't possibly answer for the thousands of people who created this crisis.

I am interested to see how things develop from here. I have never watched Cramer's show, but I am curious to see if he will make a few small changes to his format after this interview. I don't expect a complete overhaul, but there may be a new segment every once in a while devoted to fact-checking or something else that Stewart mentioned. Again, I'm not very familiar with the current format. In fact, I found it curious that he repeatedly referred to his show as "entertainment," a term which Stewart didn't seem to appreciate (see the quote above).

One thing Cramer said really resonated with me, though. When Stewart asked why no one asked questions about AIG's outlandish ratios, Cramer replied that funds were gaining 30% per year for almost a decade (it was something along those lines, at least). That is, people don't ask why things are going well. This brings me to my strongest belief on the subject: while there are many like Stewart who are upset about being lied to, most people are just angry they lost their money while others of some generic evil group ("Wall Street"."stock brokers"."corporate fatcats") didn't. So when companies made stockholders rich with inflated NYSE prices and trading crappy assets, nobody cared. But now that things have turned south, people think the most important thing is finding who to blame.

I'm glad Stewart didn't back down and delivered a skewering. I think Cramer handled it rather well. And I think both were pretty professional about it. I just wish someone knew how we were going to get out of this mess, regardless of how we got into it.

[red_bird]

@Piercewise
i liked your analysis, and i have a few questions for you, as a buisness major.

i don't see how buying crap i don't need is good for me, or anyone else.  i understand that not buying crap i don't need (or crap the TV tells me i want) means the people who make and distribute said crap won't get paid, but isn't that the point?  if your buisness model fails, it's not my fault for not giving you my money.

really, this is about how i think our economic culture is biased towards consumption, which i also think is a very bad idea.  how could one make more people think about the long run?  now that i think about it, staringt a buisness that looks at the big picture, and is focused on long term profits, would be a sufficient wake up call to the buisness world, especially if that enterprise weathers the lean times easily, but... i don't know, i'm just disturbed by how a few turds can ruin the swimming pool for everyone.  a lot, no, most stock brokers do insane amounts of high stress work, they try to do what's best in the long run, and they're getting stuffed with all the rest of us poor losers.

what do you think could stop this from happening again?  or, if this is inevitable, what could reduce the damage these turds do?

[CidIII]

Shitty businesses fail all the time, that's not the reason for the economy collapse. It failed mostly due to the banks getting all fucked up.

There are plenty of businesses focused on the long run. A company with a shitty business plan is never going to get to the point where they'd have significant effect on the economy. That's the beauty of a capitalistic economy, if one business fails there's most likely another to take advantage of it.

The banks were engaging in some shady activities involving mortgages, which could only be prevented with increased regulation from the government, and most people are against government interference, subscribing to a "Laissez-faire" belief.

This is just how I understand it, I'm not going to pretend that I know a lot about it because I do not. I'd be interested in hearing what Piercewise has to say about it, however.