CNBC’s ‘Mad’ man
CNBC HOST Jim Cramer is back in the news. For most TV personalities, that would be a good thing. But since it’s Cramer we’re talking about, PR can get a little dicey. Especially at such a critical time for his employer.
As you may have heard, the legendarily excitable Cramer has been telling viewers, on NBC’s “Today” and elsewhere, to bail out of stocks and grab any cash they’ll need over the next five years. Some critics are now accusing the former money manager of helping to spur a selling panic amid one of the worst financial crises the country has ever seen.
“How about this?” Cramer proposed when we discussed his controversial role in the crisis last week. “How about I said, ‘Yeah, I did it.’? You know what kind of hubris that is?” On the word “hubris,” his voice suddenly rose to a near-whistle, the way it often does when dispatching callers on his dizzying, buzzer-laden, stock-picking extravaganza “Mad Money.”
“I’m not Warren Buffett!” he added.
That last part is indisputably true. Yet Cramer is now the standard-bearer of a network that, because of the Wall Street meltdown, is back in the spotlight once again.
It’s been nearly a decade since CNBC’s glory years, back in the heady era of day traders and the Internet boom. Now ratings are soaring as nervous investors mop up any info they can get about the market malaise.
Network executives say they’re on track for a second straight year of record profits. This despite early reports that heavy advertisers such as credit-card and mortgage companies are pulling back on spending as quickly as they can. But the brass insists that the panic of ’08 will be a good thing for the NBC Universal-owned network, which aims to deliver business news to affluent investors.
“This brings a lot of sampling to CNBC,” Mark Hoffman, who has received much of the credit for revitalizing the network since taking over as president in 2005, told me, referring to the panic. “If we are able to recruit some of those viewers to our core, then we come out of this stronger. And we feel pretty confident that we will.”
Yet one gets the sense that this point in the CNBC timeline is also tinged with a streak of anxiety.
Just as news of the $700-billion federal bailout of Wall Street was sinking in, Vanity Fair landed with a feature story that posited a juicy “All About Eve"-type rivalry between host Maria Bartiromo -- CNBC’s “Money Honey” of the day-trading epoch, whose reported $1-million-per-year contract conveniently happens to be up for renewal -- and her younger, even more visually dazzling colleague Erin Burnett, whose now-notorious penchant for off-color remarks includes the recent on-air observation that the economy needs a cleansing “enema.”
The Vanity Fair piece ended with Bartiromo implying that any talk of a rivalry may have been cooked up by the CNBC public-relations department, which if true both undermines the story’s premise and suggests that the network’s internal meetings must contain subtexts worthy of a Russian novel.
More important, CNBC now faces an irreverent competitor in Fox Business News, the year-old network from Rupert Murdoch’s News Corp. Cramer has in many respects been CNBC’s face during this crisis, and Fox Business, a la the mischievous PR strategy of its sister network, Fox News Channel, has delighted in tossing a pie his way. (In 2000, Cramer and Fox News settled a lawsuit that claimed he had backed out of a deal to develop a show for the network.)
A week ago Friday, Fox took out a half-page ad in Murdoch’s Wall Street Journal headlined: “Can you afford to watch CNBC?” The ad was decorated with an image of a bobblehead toy of Cramer and bedecked with some of the host’s past clinkers, such as “Bear Stearns is fine” (uttered just before the firm collapsed) and “It’s time to buy, buy, buy” (which he told viewers in June). What especially nettled many at CNBC was that Fox also ran a similarly scathing anti-Cramer ad on CNBC’s own air in certain markets, by cutting deals with local cable operators over whom the network has no control.
In a statement, a CNBC spokesman flicked away the Fox ads as “a predictably desperate attempt by a completely irrelevant network.” And it’s true that in terms of ratings, it’s not much of a contest, at least not yet.
Fox Business Network, available in about 42 million U.S. homes, says that since the economic crisis began, it’s averaged 32,000 viewers between the hours of 5 a.m. and 9 p.m. (That’s up 433% compared with last October, when the network just started.) Between July and September, CBNC, available in 97 million homes, averaged 396,000 viewers during Wall Street trading hours, its peak viewing time, for a year-to-year gain of 22%, according to Nielsen Media Research.
But FBN just marked its first anniversary Wednesday, while CNBC turns 20 next year. FBN insiders like to argue a parallel with Fox News, which also started as the butt of jokes but within five years was cleaning CNN’s clock.
“I’m kind of jazzed by being the underdog,” said Fox’s Neil Cavuto, a former CNBC host, who added that the economic crisis is to FBN what the Monica Lewinsky scandal was for Fox News.
“These are seminal moments -- maybe I should rephrase that -- that galvanize attention to a network,” he said.
Kevin Magee, Fox Business’ executive vice president, agreed that the crisis will prove “a watershed moment” for Murdoch’s network.
And the Cramer controversy, he argued, played right into his hands. Magee faulted the “Mad Money” host for “uniquely bad” advice over the years.
“People don’t like to lose money,” Magee said. “When he tells you to stay in a stock that collapses a few days later, people remember that stuff.”
But for right now, people are still paying attention to what Cramer says. And in television, attention trumps all.
For his own part, Cramer insisted he ignores his legion of skeptics and haters. “I have not seen any of the Fox ads,” he said. “You know why? For the same reason that I haven’t read a blog about me in years; I haven’t read an article about me in years. Because you know what? I gotta do my job.”
Cramer explained that he advised viewers to sell stocks for near-future needs simply because that’s what he was doing. With a daughter headed to college next fall, he said that, as the market spiraled down, he frantically called his broker to cash out of some mutual funds. “I’m not just a TV person,” he said. “What I am is a dad who happens to have a show.”
But he wanted to make clear that he isn’t running away from investing in stocks. “I am still committing for my retirement. I’m not backing away. Because I have no intention of retiring in the next five years.”
The Channel Island column runs every Monday in Calendar.
Contact Scott Collins at scott.collins @latimes.com.