Friday, December 10, 2010

More Idiocy On CNBC

I try to refrain from commenting on some of the lunacy I see on CNBC, but every so often, the level and frequency of the idiocy simply demands it.

A few days ago, Maria Bartiromo was interviewing Byron Wien. Wien was advocating that people buy equity in Indian companies and some other developing/developed country. Bartiromo confirmed that he did not mean mutual funds, and Wien confirmed this.

Then Bartiromo responded, with a clear tone of confusion,

'So you mean investing directly in the companies?'

Wien replied, with a sort of air of slight impatience, that, yes, that is what he had meant.

'So viewers should buy these firms on the local Indian and (other country) exchange?'

Wien, by now getting a little exasperated, confirmed this, and added that some were listed on the NYSE, so people could buy them there, too.

Then Bartiromo moved to Wien's apparently well-known annual list of his unexpected developments for the next year. She noted how three of last year's had widely missed the mark, and Wien tried to cover his errors by saying something like,

'Yes, I was early on those calls.'

Bartiromo then earnestly intoned,

'So do you think they'll come true in 2011?'

Now, at this point, you have to be brain dead not to realize that Wien devises a new list every year, right? So what do you think he would say about last year's predictions, relative to the coming year? Of course he told the hapless CNBC anchor that he makes up a new list, so those old predictions weren't relevant now.

Ever unflappable by her obvious misunderstanding of Wien's annual list, she babbled something inane, then finished by saying, to closely paraphrase,

'Thanks Byron. We'll be waiting for your 2011 list, as you're always so often on the mark with those predictions.'

You can't make that sort of remark up, can you? The combination of qualifiers is, on their face, ludicrous. Further, Bartiromo began the topic by pointing up three of Wien's recent big misses, giving a viewer the sense that Wien's hunches are typically way off the mark.

She can't get basic interview questions and replies straight. She manages to give viewers opposite senses of what she then tries to assert about a topic or guest. Then Bartiromo can't manage to use the English language properly on air.

Why the hell is she still on CNBC? Sadly, the fact that she is marks the network as having low standards for most of its reporting and on-air staff.

Then, this morning, I watched Mark Haines beat up a very sensible conservative guest, who commented on the current tax rate debate in Washington, using completely nonsensical logic.

Anyone with a brain knows that tax rate changes provoke behavioral changes in businesses, consumers and savers. It's known as dynamic scoring, and the CBO still doesn't use it. That's why you can read so many articles in the Wall Street Journal by eminent economists such as Alan Reynolds, Robert Barro, Brian Westbury,, cataloging the CBO's large predictive errors when forecasting revenues to be raised by tax rate hikes, or lost by rate cuts.

But Mark Haines will have none of it. Instead, he pilloried the guest, saying that if he decried Congressional spending, then he had no right to argue for a tax cut, because 'that's just like spending.'

Haines is evidently too dense to understand that Congress really spends what it says it will, whereas forecasts of government revenue gains from personal rate hikes on the wealthy never meet expectations. It's simply not a zero sum game, as explained by economists who calculate the total income of some top percentile, such as 5%, and compare it to annual federal spending. It's never enough. It never comes even close to making a difference.

What government forecasters continue to ignore is the change in the amount of economic activity due to tax rate changes, on which incomes are earned and taxes paid. When rates are cut, economic activity surges, incomes rise, and taxes do, as well.

It's not about higher rates, but lower rates which bring forth more economic activity.

You'd think that after, what, two decades on air at CNBC, listening to this debate, Haines would have learned the facts?

But you'd be wrong to think that. Instead, like Bartiromo, CNBC leaves in place an also-ran on-air personality.

Which is why I neglect what most of the CNBC staff say, excepting Rick Santelli, Trish Regan, Joe Kernen,  and Michelle Caruso Cabrera. I just listen and watch mostly for the news.

No comments: