I'm Not as Bad as Howie Kurtz Says
From: James J. Cramer
To: Howard KurtzPosted Tuesday, Sept. 26, 2000, at 11:30 PM ET Look Howard, the real cesspool is the sell-side. (Sell-side equals the major brokerage houses. The salespeople [brokers] who move merchandise.) Why not outright praise those who are trying to clean it up? Why not praise those who take the craft of journalism seriously enough to attack the whole sell-side/mutual-fund edifice that works to promote both good and bad stocks? And why not identify who is being manipulated in the media and expose them?
It's the takeaway of the book, more than the book itself, that I find most disturbing. You make charges that the media are manipulated and that money managers manipulate. Then you spend a huge chunk of time talking about Mark Haines, Joe Kernen, and David Faber, and of course yours truly. To the uninformed, trying to figure out whether to read the book, you would have to believe that the manipulators are none other than us! Sure, once they get in, they will discover that the manipulators that you have been talking about endlessly on your tour are not us at all. In fact, maybe we are the good guys.
But who are the bad guys then? Who in the media is getting it wrong? Who on the money-management side is manipulating? Tell us, Howard. Write another book and nail the sons of bitches. As of this writing, you've done nothing more than insinuate someone is doing it and created a global book-tour impression that it is me.
From: James J. Cramer
To: Howard KurtzPosted Tuesday, Sept. 26, 2000, at 11:30 PM ET James J. Cramer is president of Cramer Berkowitz, a $400 million hedge fund in New York, and a daily columnist for
TheStreet.com, a financial Web site he co-founded. Howard Kurtz is the media reporter for the
Washington Post and the author of
The Fortune Tellers: Inside Wall Street's Game of Money, Media and Manipulation (click
here for an excerpt and
here to buy it). The author of three previous books, including the best seller
Spin Cycle, Kurtz is also the host of CNN's
Reliable Sources.
Reader Comments from The Fray:
Cramer:
You are asking Kurtz to hit the sell-side harder when, in my view, your site, TheStreet.com, goes pretty easy on them. I'm aware that your writers want to make a specific point, but I don't think they should sacrifice facts to achieve that aim. Recently, one of your writers wrote about Blodget's internet sector downgrade and wrote that he was using the Neutral rating for the first time. That was untrue, but it made the downgrade sound like a bigger deal. In the past, I have been interviewed by your writers and provided background analysis of Merrill Lynch research calls. Re: the DCLK example in the book, you could have called Blodget to the mat if you had asked him why he was recommending internet stocks on which his price targets suggested negative returns.
Kurtz:
What's the big deal with ETYS? You are not providing the whole picture. Blodget recommended ETYS at a report price of $37.50 and with a 12-18 month price target of $50 (33% upside) and a near-term Accumulate/long-term Buy rating. Based on typical ML research guidelines, those specs would make the stock eligible for a downgrade at a price as low as $41.67. (The minimum appreciation threshold for a ML Buy rating is 20%.) ETYS actually went up more than 100% from $37.50. The problem was that when ETYS was trading in the $50s, $60s, and $70s, Blodget continued to recommend purchase even though he wouldn't raise the price target from $50. Even more puzzling is that ML let him continue to recommend it. If ML had enforced its own typical guidelines, ETYS would have been downgraded and you would have had to select among 20 or so other similarly bad performing stocks to highlight. By the way, in your book, you say that Blodget downgraded Amazon from Buy to long-term Accumulate. That is wrong. It was from Buy to Accumulate, both near-term (or in official ML language, intermediate-term).
--Bob Kim
(To reply, click here.)
Having read just the excerpt of The Fortune Tellers online, I have to admit that it looks like Cramer has a point. Howard Kurtz is probably right in general where insisting that someone trying to divine the vicissitudes of stock market aggregates or of the individual issues which comprise the aggregates from moment to moment is, more often than not, someone fumbling around in a blizzard--a raging storm of impossible-to-gauge elements which admit of very little visibility alone or in their concatenation.
But surely the more interesting story concerns not the impact of these "fortune tellers" or the conflicts and challenges they pose to market regulatory institutions but the personalities of the actors who have promoted themselves to a standing where pure visibility may equal or be confused with what power and elements drive markets in reality. Cramer is more interesting--and, not incidentally, more revealed--in his own words than he is in Kurtz's depiction.
--Mark S. Devenow
(To reply, click here.)
(9/28)
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Reader Comments from The Fray:
Cramer:
You are asking Kurtz to hit the sell-side harder when, in my view, your site, TheStreet.com, goes pretty easy on them. I'm aware that your writers want to make a specific point, but I don't think they should sacrifice facts to achieve that aim. Recently, one of your writers wrote about Blodget's internet sector downgrade and wrote that he was using the Neutral rating for the first time. That was untrue, but it made the downgrade sound like a bigger deal. In the past, I have been interviewed by your writers and provided background analysis of Merrill Lynch research calls. Re: the DCLK example in the book, you could have called Blodget to the mat if you had asked him why he was recommending internet stocks on which his price targets suggested negative returns.
Kurtz:
What's the big deal with ETYS? You are not providing the whole picture. Blodget recommended ETYS at a report price of $37.50 and with a 12-18 month price target of $50 (33% upside) and a near-term Accumulate/long-term Buy rating. Based on typical ML research guidelines, those specs would make the stock eligible for a downgrade at a price as low as $41.67. (The minimum appreciation threshold for a ML Buy rating is 20%.) ETYS actually went up more than 100% from $37.50. The problem was that when ETYS was trading in the $50s, $60s, and $70s, Blodget continued to recommend purchase even though he wouldn't raise the price target from $50. Even more puzzling is that ML let him continue to recommend it. If ML had enforced its own typical guidelines, ETYS would have been downgraded and you would have had to select among 20 or so other similarly bad performing stocks to highlight. By the way, in your book, you say that Blodget downgraded Amazon from Buy to long-term Accumulate. That is wrong. It was from Buy to Accumulate, both near-term (or in official ML language, intermediate-term).
--Bob Kim
(To reply, click here.)
Having read just the excerpt of The Fortune Tellers online, I have to admit that it looks like Cramer has a point. Howard Kurtz is probably right in general where insisting that someone trying to divine the vicissitudes of stock market aggregates or of the individual issues which comprise the aggregates from moment to moment is, more often than not, someone fumbling around in a blizzard--a raging storm of impossible-to-gauge elements which admit of very little visibility alone or in their concatenation.
But surely the more interesting story concerns not the impact of these "fortune tellers" or the conflicts and challenges they pose to market regulatory institutions but the personalities of the actors who have promoted themselves to a standing where pure visibility may equal or be confused with what power and elements drive markets in reality. Cramer is more interesting--and, not incidentally, more revealed--in his own words than he is in Kurtz's depiction.
--Mark S. Devenow
(To reply, click here.)
(9/28)