As a post-script to my earlier rant, I should also say that CNBC, while certainly not responsible for anyone's losses, has indeed been guilty of 'aiding and abetting.' Believe me, I can vouch for this personally with a story I have shared previously on this thread.
Last August I had a short position in AMZN that (for me at least) was quite large. The 2nd largest position I've ever had in one stock (the largest was long ELN warrants in Dec. '99 through June 2000) in fact. I'd done quite a bit of due dilly and was convinced I was right.
As you may remember, towards the end of August, Jeff Bezos went on a PR kick in NYC to boost the stock and a few investment banks (who were looking to gain favor with AMZN brass, hoping to participate in future investment banking deals) issued some of the most ill-conceived "reiterate strong buy" reports I've ever seen in 12 years in this business. To be sure, I don't begrudge them for that--they're in the business of soliciting investment banking biz and all is fair in love and war, right? But the investment theses used in these reports were downright ludicrous and it doesn't take a stretch of imagination to see the reasoning behind it, they were looking to create a short-squeeze in AMZN shares--in fact, one of the strong buy recs issued came out and said, "we feel there is a short-squeeze coming in the shares and that's why you should buy AMZN." Yeah, it smelled of manipulation, but that's the way the game's played, and I can accept that.
However, despite the incredibly flawed analyses used in these reports and the fluff PR releases AMZN issued, CNBC (and Maria in particular) did a helluva job on the cheerleading side. Anyone who understood the markets could easily see this was nothing more than a short-squeeze attempt, yet there was CNBC, trumpeting the B.S. on an hourly basis for 3 weeks straight, as if AMZN's fundamentals had drastically changed overnight. Every time Maria would parrot what her pals at Goldman were feeding her, AMZN would go up another 2 bucks. Like I said earlier, it's one thing for the huckster investment banks to play their games...it's yet another for CNBC to help them out.
That was the closest I've ever come to being "wiped out" on a position...and believe me, it was a very close call. Another couple of points up and I'd now be selling womens' shoes with Al Bundy. Was CNBC responsible? No, of course not. But they sure as hell fanned the flames as hard as they could, and everyday there was Maria, on the floor of the NYSE, armed with the cans of gasoline given to her by her pal Jeff Bezos and Anthony Noto, pouring them on the flames with reckless abandon. "Get ready folks...Amazon is holding a HUGE analysts' meeting at the end of September and boy it's gonna be a doozy..." And everyday, she'd remind us "Amazon has OVER A BILLION DOLLARS IN CASH in the bank..." when, if she had one iota of business sense, she would've known the question on AMZN WASN'T how much cash they had BACK THEN, but how much cash they'd have left in 12 months.
I'm sure a lot of people DID get stopped out of their AMZN short position back then, which, if they had been able to hold on, would've ended up as a huge score for them since the stock is now quoted in mens' shoe sizes. So when you say "I get so sick and tired of people blaming CNBC and/or the analysts shown thereon for one's incredible shrinking portfolio..." you make a valid argument and I agree with you, that anyone who bought something and lost based on what they saw on CNBC deserved to get slammed. But CNBC has occasionally caused collateral damage based on their irresponsible hype ways.
As ridiculous as it seems, these guys can and do move the markets based on what they say on the air. Sometimes what they do (Maria in particular) is akin to yelling "Fire!" in a crowded movie theater. With so much power over the markets, you'd expect them to act a little more responsibly than to parrot the latest scam brewed up by the investment banks...again, it was so obvious what AMZN and their cohorts were up to back then, so why couldn't Maria "ferret" out the real story, and why was she so willing to overlook the facts? She either:
a.) can't understand simple financial concepts, or
b.) is more concerned with her "Money Honey" image and is willing to foresake her journalistic integrity to maintain that moniker.
Either way, CNBC's integrity suffers because of it. |
