Transparency with Stock Information


Many of you know that CNBC is now a one stop shop for all things stocks. What many people have noticed is that a variety of programming on CNBC is geared towards enlightening them on how to “play the market” to obtain long term financial growth. Many people have also noticed if they watch on a daily basis is that things can change very quickly from buy, buy, buy to sell, sell, sell depending on a wide variety of things impacting the stock market. One of things I’ve noticed when watching CNBC programming is that there is a variety of transparency with respect to the stocks. Some programs seem to be promoting stocks they own, while others are presenting informed commentary and letting you know if they have any skin in the game too.

The two biggest examples of transparency variants occur during the 5PM to 7PM block on CNBC where there is Fast Money from 5PM to 6PM and Mad Money with Jim Cramer from 6PM to 7PM. Let’s examine each show in its entirety.

Fast Money:

Fast Money airs Monday through Thursday from 5PM to 6PM EST. On Friday it airs 5PM to 530PM due to a show about options filling in the remaining half hour. Fast Money’s format features a moderator and four guests all of whom have extensive investing experience for various firms. The moderator, usually Melissa Lee, asks informed questions based off of what occurred during the market hours that day. Each guest offers their opinion on what has occurred and in a number of cases describe how investors should react to this information. Sometimes that is to buy a stock, sometimes that is to short a stock and sometimes that is to sell a stock. Nearly every thing the guests discuss features a pop up on the screen that will tell you the position of that guest or the firm they work for. For example, Brian Kelly often discusses the $TLT and the pop up will indicate he is long that stock. In recent weeks when $TWTR has struggled repeatedly Tim Seymour would discuss the stock and CNBC was sure to indicate to viewers that he is long in the stock. The pop ups will even inform viewers if the guests have no position in the stock they are discussing as well. This helps put viewers at ease as the guests are discussing a wide variety of stocks on the market and they [or their firm] might happen to own a few of them.

Mad Money:

Mad Money with Jim Cramer airs Monday through Friday from 6PM to 7PM EST. Mad Money features a far different approach than Fast Money. While Fast Money features current employees of investment firms debating on how to play the market and offering a number of different ideas to the viewer, Mad Money features Jim Cramer who has been out of the investment business since 2000. Cramer just offers one voice to his viewers, as opposed to a multitude like Fast Money. While Fast Money has interchangeable guests who offer a fresh perspective on how to succeed in investing all of the content presented on Mad Money is Jim Cramer’s. Mad Money rarely if ever discloses whether or not Jim Cramer owns the stocks he is discussing. The format is not only different, but the feel of this show is different as well. Fast Money is a show about presenting information, while Mad Money seems to be a show about pedaling Jim Cramer’s products. The members of Fast Money have books and websites to promote, but they do not. Jim Cramer repeatedly discusses his published books and his website where he and others publish on investing [among other things]. Mad Money’s aim seems to be to give minimal information so that viewers flock to the bookstore or Jim Cramer’s website to purchase further information from him. Jim also struggles to answer call in questions that ask about stocks he isn’t familiar with. He will often tell them he’s not familiar with the stock and that’s it, no advice one way or the other. The Fast Money guests may not know every stock off the top of their head, but they are willing to offer information to the viewers so they are informed.

Transparency Overview:

Fast Money is a far more transparent program when it comes to revealing what stocks the professionals are involved with. Your mission as an investor is to make yourself money, not make professionals money. Fast Money is very clear in who would benefit from your transaction in a certain stock, but Jim Cramer is not. In order for you to succeed as Jim Cramer claims you will, you might have to spend a little extra money on the items he sells on his website or his books. Even then there is no guarantee you will become rich because the stock market is volatile.

Jim Cramer is probably just as informed and skilled as the guests on Fast Money despite being “retired” since 2000 from any investing firm. The issue I and most other viewers might have is that the lack of transparency makes it seem as though Jim is only using this platform for some extra money. Jim Cramer’s Charitable Trust and other things he discusses on the air should be common knowledge, rather than something you need to pay to see. Ultimately the idea is about investing in Jim Cramer, as evidenced by the fact that is on the stock market!

You can use the information from both shows and be successful, as many have, but I feel its far safer for investors to be aware of who owns what stock because it gives the investor something to think about. Someone may be optimistic about a stock if they own it, while everyone else is pessimistic.

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