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Rah-rah CNBC had the suckers going for a ride

By Martha Smilgis Special to The Examiner

THERE IS NO doubt in my mind that we fools who have religiously watched CBNC over the past three years have lost money in the stock market. My proof comes from the network's ratings. When the Nasdaq zoomed to astronomical highs, CNBC's viewership soared as well. Now, with the Nasdaq in free-fall, we remorseful investors click off the tube. The network of promise has become the network of pain.

History, however, teaches us to behave differently. The more scholarly sages of Wall Street tell us that the 6 percent of investors who buy at the bottom of the market make money and the 80 percent of us who fell for the CNBC daily drumbeat of casino hype -- and bought tech stocks near the top ---- are, simply put, suckers. We suckers are now turning away from what was our favorite feel-good network, disgusted at the sinking value of our once-beloved stocks.

Back during the tech boom, we usually sober and circumspect investors were snookered by CNBC's happy-faced anchors and climbing green ticker tape set to a background of pulsing music. At the dawn of 2000, CNBC was suddenly everywhere. It became the wallpaper network. The familiar gang of personality-plus anchors appeared in offices, kitchens, barrooms, liquor stores and even gas stations. Elevators and gyms were lit up by the dancing ticker tape under those ebullient faces.

Just a year ago, in powerhouse urban centers, sophisticated dinner conversation actually focused on how in the world Joe Kernan's tousled hair and lopsided grin got him a Playboy layout. (In case you don't recognize the name, he's CNBC's wiseacre stock specialist who looks like he's falling off his chair.) Intelligent career women debated whether or not Sue Herrera wore too much makeup and speculated as to which Wall Street mogul Maria Bartolomo, the Sophia Loren lookalike, had married. And no one can deny that the boyish charm of Bill Griffeth is infectious, while the broad-shouldered Ted David relates his diet woes in an amusing manner.

WHAT WE HAVE here is a colorful cast of television characters with distinctive personalities and entertaining cross chat. What we don't have is a group of serious business journalists. OK, save maybe Ron Ansana with his skeptical and quizzical asides, but overall, as a group, we are talking about a parade of bubbleheaded television readers.

Herein lies the problem: We foolish viewers and equally naive investors attributed some type of critical skill to their performance. What a mistake! The CNBC bubbleheads are simply unquestioning promoters who created a friendly platform for every con artist analyst to come aboard and hawk his or her bogus stock estimates. And were they bogus! The reward for most outrageous performance goes to Walter Piecky, tech analyst for Paine Webber, who issued a BUY on Qualcom at $420 a share with a target price of $1,000! This with a straight face, no less. (Today Qualcom hands on at $61)

The BUY-BUY-BUY mantra of these guest analysts spouted on CNBC would be humorous if we investors hadn't lost so much money. Checking the stats, one now realizes that 98 percent of all stocks mentioned were BUYS with a paltry 2 percent SELLS. What's even more amazing is that, even now the Nasdaq scraping bottom, these charlatan magpies are still crowing BUY, this time on Value stocks, many of which have already hit new 52 week highs!

Of course, what you don't learn from the cheerleader network is that each guest analyst on the show is paid by a brokerage house that makes money off the stock the analyst promotes. (Mary Meeker, tech anlayst for Morgan Stanley made $15 million in 1999 going on CNBC telling viewers to buy Priceline at $165 a share ---- now down to $2.) Along with not bringing these critical behind-the-scene details to the viewer's attention, our happy-faced anchors don't even question those with obviously vested interest in the companies they are promoting. Too often, eager-beaver mutual fund managers come on to pump (and then later dump) stocks they own.

NOW THAT TECH is in the toilet, it is curious how the cheerleader network has changed. When you do hear a "downgrade," it is practically a whisper. Natch. Analysts don't get paid to downgrade a stock, for all we know they probably get a salary deduction. The real joke is that the few downgrades that you do hear come in after the horse is out of the barn. Downgrading a stock that is at a 52-week low, takes brains? Pulease!

The sooner CNBC banishes analysts and the annoying static they create, the better. But there's a fat chance of that happening, because the network relies on them for news. Our happy-faced anchors aren't about to do any investigative reporting and actually give us an objective account of market conditions. Instead, they are too often shills for the financial industry ---- one often known to fleece the investor.

Those of us with long careers in journalism know that traditionally those with the least talent go into biz reporting. It is a place to start, like writing obits.

But now with the brainpower of the baby boomers swerving over to business, thanks to their once-plump IRA accounts, you would think we could get some top-notch biz journalists front and center instead of a lineup of Wall Street manipulators out to pad the pockets of brokers, analysts, fund managers and yes, the silver-tongued anchors.

Viewers beware: Watch at your own risk!

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-- Martin Thompson (mthom1927@aol.com), March 18, 2001