This afternoon, after the close of the market, CNBC featured a sort of on-air verbal brawl between three people- Steve Liesman, Ron Insana, and Larry Kudlow.
The topic was the overall health of financial markets as they affect the US economy.
It should be noted that only one of the "debate's" participants is a trained, recognized economist. That would be Larry Kudlow. Before going further, here are the relevant elements of the three persons' bios, from the CNBC website, regarding their educational background and economics credentials.
Liesman's CNBC bio,
Liesman joined CNBC from The Wall Street Journal where he served as a senior economics reporter covering monetary policy, international economics, academic research and productivity. At the Journal, Liesman previously worked as an energy reporter and, from 1996-98, as the Journal’s Moscow bureau chief. He was a member of the reporting team recognized with a Pulitzer Prize for stories chronicling the crash of the Russian financial markets.
Liesman holds a Masters of Science from Columbia University Graduate School of Journalism and a B.A. in English from the State University of New York, Buffalo.
Insana's CNBC bio,
Insana began his career in 1984 as an FNN production assistant, rising to managing editor and chief of FNN's Los Angeles bureau at the time the two networks combined. Insana graduated with honors from California State University at Northridge.
Kudlow's CNBC bio,
Kudlow is consistently ranked one of the nation’s premier and most accurate economic forecasters according to The Wall Street Journal’s semiannual forecasting survey.
He is a Distinguished Scholar of the Mercatus Center at George Mason University in Arlington, Virginia.
In 2005, New York Governor George Pataki appointed Kudlow the chairman of the New York State Tax Reform Commission.
For many years Kudlow served as chief economist for a number of Wall Street firms. Kudlow was a member of the Bush-Cheney Transition Advisory Committee. During President Reagan’s first term, Kudlow was the associate director for economics and planning, Office of Management and Budget, Executive Office of the President, where he was engaged in the development of the administration’s economic and budget policy.
He is a trusted advisor to many of our nation’s top decision-makers in Washington and has testified as an expert witness on economic matters before several congressional committees. He has also presented testimony at several Republican Governors Conferences.
Kudlow began his career as a staff economist at the Federal Reserve Bank of New York, working in the areas of domestic open market operations and bank supervision.
Kudlow was educated at the University of Rochester and Princeton University’s Woodrow Wilson School of Public and International Affairs.
It's clear from CNBC's own information that neither Liesman, their so-called 'senior economics reporter,' nor Insana, have any credible economics credentials, or, for that matter, much experience with financial markets, other than reporting on them.
Insana is alternately described as a "CNBC contributor" and a "principal at Insana Capital Management," or some other similar title of a similarly-named, obviously self-started boutique. Before that, he was a regular CNBC employee who was moved about, unsuccessfully, in search of some sort of regular hour show on the cable network. Between his rather boring demeanor and lack of in-the-trenches experience, as, say, Rick Santelli, Insana never seemed to catch on with viewers. One gets the feeling he has the CNBC "contributor" gig as a sort of exit deal with the network, in order to help him get visibility for his new 'capital management' startup. Being seen on CNBC would obviously confer the image, perhaps incorrectly, that Insana is a well-regarded, sage, experienced capital markets veteran whom the network is fortunate to have as a guest commentator.
What began, ostensibly, as a discussion of the current interplay of the economy and capital markets quickly descended into a political scuffle, with Liesman and Insana declaring that the Fed and the Bush Administration, in the person of Hank Paulson, had failed miserably to mobilize governmental power to magically solve the current crisis. Both non-economists railed that the financial markets, and the economy, were damaged, and both Bush and Bernanke had failed the American people by being 'behind the curve' in somehow resolving both crises by now.
Kudlow weighed in on the economics of the current situation, pointing out that financial markets would be best-served by simply being allowed to sort out valuations and credit allocations themselves. In this, he echoed Rick Santelli's comments from this morning, wherein he opined that the more Washington interceded in financial markets, the longer it would take for them to eventually sort out valuations and capital flows.
What was incredible about the spectacle that developed between Liesman, Insana and Kudlow is that the two un-credentialed, non-economists behaved so condescendingly to a genuine economist, and one of note, Kudlow, on such fundamental issues as financial markets and macroeconomics, pointedly denying and ignoring Kudlow's simple and correct assertion that they just wanted government intervention.
It's a crucial point. Liesman went further to assert something like,
'Congress is fed up with Paulson's and Bernanke's excuses and late awareness of these problems,'
as if Congress' opinion matters. Translation: Liesman and Insana think that any lack of admission by the current Administration, or the Fed, that investors and bankers got themselves into this mess, and are more or less going to have to get themselves out of it, constitutes failure.
Kudlow steadfastly called their position what it is- interventionist governmental politics pandering to an incorrect populist belief that, somehow, the Federal government can and should cure all naturally-occurring market cycles that are temporarily more painful than people wish to experience.
To take Liesman's and Insana's arguments to their logical conclusions, the US economy should never experience economic slowdowns, recessions, or financial markets cycles.
We just won't have it. We'll demand that Washington simply stop them. Cycles- whether economic or financial market in nature- are inconvenient, and, henceforth, outlawed.
Sounds a lot like that song from the musical Camelot, where rain is forbidden until after sundown, doesn't it?
Of course, the real tragedy here is that CNBC employs Liesman and Insana and presents them as economically- and financially-savvy, without apology.
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