SubscribeCNBC caused Bear Stearns Collapse???
July 2, 2008
Is CNBC responsible for downfall of Bear Sterns? In the upcoming issue of Vanity Fair, the collapse of Bear Stearns, that is the argument. On the morning of March 10th, CNBC began reporting a rumor that Bear Stearns was having liquidity problems. That sent shockwaves through the system and Vanity Fair’s author is proposing that CNBC was the root cause of the final collapse:
…Yet CNBC’s coverage remained anything but skeptical of the rumor. At two the network’s new “money honey,” Erin Burnett, headlined the hour by announcing “credit issues at Bear,” never mind that there was no such thing. She turned to correspondent David Faber, who observed, “Of course, no firm’s ever going to say that they are having trouble with liquidity, and, in fact, you’ve either got liquidity or you don’t. So if you don’t have it, you’re done. Those are the kinds of concerns in this market, concerns of confidence. You can have crises of confidence, causing meltdowns.”
By the end of the weekend, Bear Stearns was done. You know the rest of the story.
The destruction of a Wall Street giant all on an uncorroborated rumor fueled by CNBC correspondents that were more interested in topping each other than reporting the facts? Hard to believe, but who knows these days. Perhaps they took lessons from that NY Times writer from a few years ago…what was his name?
So, is CNBC guilty of this or just the messenger?
TDI Episode 56: How to be a CNBC Millionaire
May 11, 2008
Guests: Brian Shactman, CNBC and Brian Shannon, AlphaTrends. As the CNBC Million Dollar Portfolio
Challenge is about to get underway, we look at the competition, the strategy and the prizes.
Brian Shactman joined CNBC in June 2007 as a general assignment reporter and fill-in anchor for CNBC’s Business Day Programming. Shactman joined CNBC after his four-year tenure at WVIT, the NBC owned-and-operated station in Hartford, Connecticut. The last three of which he served as the morning news anchor for “NBC 30 News Today,” the station’s top-rated program
Shactman covered a variety of stories, ranging from campaign finance reform and the scandal surrounding former Governor John Rowland, to the Red Sox winning the World Series in 2004.
Prior to joining NBC in 2002, Shactman held various positions at ESPN including analyst work on ESPNews, SportsCenter and on their flagship radio network. He also wrote, edited and produced content for ESPN.com. After leaving ESPN, Shactman remained active at the company, hosting a variety of Read more
TDI Episode 49: Pharma Huckman’s Market
March 23, 2008
Guest: Mike Huckman, CNBC Pharmaceutical Reporter brings great deal of timely information regarding the Pharma and Biotech sectors. We discuss Merck (MRK), Amgen (AMGN), Genentech (DNA), Dendreon (DNDN), Pfizer (PFE) and others.
Mike’s writes a terrific blog and appears daily on CNBC.
Andrew discusses the current markets and provides a few strategic moves for profit potential. Last week was a see-saw market and if positioned correctly, your portfolio could be holding up well. Even so, it looks as though the economic environment could continue to deteriorate. In this episode, we explore the next looming problem and how to protect yourself.
**AWARENESS and discussion of the Credit Card Crisis has not yet made it to the mainstream headlines, but we see that there is potential for additional economic fallout as Americans continue to build credit in order to pay for their increasingly expensive lifestyles.**
In this edition of The ZachZone, Visa (V) and upcoming IPOs are discussed.
(This edition of The ZachZone is sponsored by Newsflashr - Get a wide angle view of all of the hot topics making news - All on a single page. )
~ Listen and Subscribe in iTunes ~
Other Stocks Mentioned in this and recent episodes: (V) (BSC) (LEH) (SPY) (SAFM) (GS) (MER) (QID) (SKF) (QQQQ) (IBKR)
Dennis Kneale: Anger Management Could Help
February 15, 2008
Things have finally gotten out of control. That statement is based on observing the recent antics of Dennis Kneale, one of the biggest creeps in the financial media today. To be honest, I have usually enjoyed his hard-hitting approach, but he needs a leash put on him. There is no reason to attack and try to discredit everyone he disagrees with…is there?
As a Media and Technology editor for CNBC, he was recently part of a biotech discussion with Derek De Koff, a gent who reportedly had significant side effects from Chantix, the “stop-smoking” drug from Pfizer. That, in itself, makes no sense.
What was weird about this interview were the questions he asked in an apparent effort to make Mr. De Koff look like an imbecile. It was as unprofessional as I have ever seen.
In a recent New York Magazine article, Mr. De Koff reported his experience while taking the prescription drug, Chantix. Realize that is was not written for the Wall Street Journal nor the New England Journal of Medicine. What is the difference? It is simple; questions asked such as the suicide statistics per thousand related to prescription drugs, among others, by Mr. Kneale to Mr. De Koff were clear attacks. By the way….Do you own any Pfizer stock Mr. Kneale?
The “This Is My Brain on Chantix” article explores one man’s experience with this new drug. He vividly points out the effects and doesn’t seem to be looking for any financial reward. So, why did Mr. Kneale need to ask if the name De Koff is a pen name as it sounds like…cough-cough. What was that all about?
Then, shortly after that mess, Mr. Kneale was in a nice battle with Herb Greenberg and Charlie Gasparino, trying to force them to confess that short-sellers feed rumors to the press in an effort to profit. Then he began accusing/blasting Gasparino as one of the reporters that does not prevent rumors from being published as well as he should. Mr. Kneale clearly believes that short-sellers operate in a sleazy way. Surely some do, as is also the case with the long side of the equation.
“More than ever before, today we report rumors,” said Kneale. The he went further and presented his “dirty little secret of journalism” thesis stating that reporters need to believe 98% of what people tell them since they require information to go on-the-air. He went on a pathetic rant and proposed that the problem with reporters is they always debunk positive reports, so not look stupid, yet want to believe the negative. It is clear that Mr. Kneale may want to believe the positive and has been very wrong on the current markets as he has been playing the part of Dow and S&P 500 fanboy of late. Mr. Kneale: Please do not overlay your apparent anger and disdain for your own errors on others that are looking to report the news without the personal attacks. (see video)
One more thing: Mr. Kneale, are you aware that your name is an anagram for - SANK IN NEEDLE ? Are you so angry about this drug because of some former personal matter? Is there more to this story? Obviously, my last comments are just as stupid as your line of questioning was to Mr. De Koff, said to make this point: Mr. Kneale, get a grip and go back to financial journalism instead of sensationalism!
Disclosure: Horowitz & Company clients do not hold positions in stocks mentioned as of the publication date of this article. (PFE)
Microsoft and Yahoo! - Facebook is the Real Reason
February 1, 2008
Balmer is dancing, Yang is sobbing. If you listen closely, you can almost hear the distant sound of Taps playing as the vultures are circling what is left of a once gorgeous technology story. After a pathetic quarter and an even more disappointing year, Yahoo! is now bleeding a slow death. The takeover announcement has opened a hole in the fabric of the universe today. It may seem like an alternative reality that Microsoft (MSFT) and Yahoo! (YHOO) will merge, but that was precisely what was announced. For $44 billion (66% premium), Microsoft will step up their web presence and create the most significant competition to Google (GOOG) that we have seen since Google’s inception.
Throughout the morning, this announcement was the focus of CNBC discussions and online message boards. Admittedly, it was a left-field surprise to guests and reporters as well as individuals and institutions. One oddball standout in the discussion was CNBC’s commentator Jim Goldman who talked the deal down and continued his Gah-Gah praise (love affair) with Goo-Goo. One has to wonder what is his angle is as he seemed to qualify the news as nothing more than a fly in the ointment for Google’s long-term strategy. Jim, wake up… this easily throws a 900-pound monkey wrench into Google’s quest for global dominance for all things online.
As Google has been executing with almost flawless precision, Yahoo! has been generally fathering. So what makes this so attractive to Microsoft? It is simple, synergistic and an accretive transaction. It has also been estimated that it could provide a terrific addition to the bottom line, adding approximately $.13 of positive earnings per share to Microsoft. That is a deal worth doing!
Beyond that, the reasons and rationale will be tossed around for the next few weeks. Many have also questioned whether or not Google would thrown in a bid for Yahoo!. Truth be told, it is not their style. It would surely meet with regulators disapproval as Google holds the majority of market share. Anti-trust is not Google’s game. Even so, while it appears that this could take some market share, the combination is still not strong enough to significantly hurt Google.
So, why is this merger/buyout in the works? Simple…it is all about the the Facebook Nation. This is apparently the main focus of the Microsoft plan as they have been slowly moving towards a greater relationship with Facebook for some time. Have you taken notice of the sea-change to the look and feel of Microsoft as a company as they have finally realized that “square-corners” is not selling. Microsoft wants desperately to be hip. They own the desktop, but they don’t own the action/nightlife.
Think of a teenager living in their parent’s home. They use it as a place to flop, eat and wash. They tolerate their parents yet keep them at a social distance. Once they have their wings, they are out of there. Apple (AAPL) has done a good job at capturing the early adoption of many of the Gen-Xers and now Gen-Y is up for grabs. This is the social generation with idealism. “They’re after a sense of purpose, work-life balance, fun, variety, respect, and the opportunity to do ‘real’ work that makes a difference. Arguably everyone wants these things from a job but the difference with Generation Y is they’ll talk with their feet when their needs are not fulfilled,” explains by author Peter Sheahan in his book Generation Y.
The communication vehicle of choice is text messaging and Facebook. This generation is always-on in a virtual-conversation. Privacy is not as much of a concern to them as is the thought of knowing that someone is listening.
Yahoo! Offers sex-appeal and millions of potential opportunities for eyeballs and access for Microsoft. It a way of stepping up the cool factor for Microsoft to ensure that they will be the choice for search, operating system and mobile products for generations to come. The timing couldn’t be better as the first chink in Google’s earnings growth was announced just hours prior. There is a plan and it looks like it may actually work. Microsoft should be able to break out above the recent resistance of $35 if this actually goes through.
Disclosure: Horowitz & Company clients are LONG MSFT
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