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Why Bloomberg TV is getting killed by CNBC

28 May

            

I prefer reading. Not because it’s mind stimulating or that it insulates me from watching Ben Bernanke, this is not an academic issue. People are very pessimistic about watching CNBC or Bloomberg and there are good examples of why this is. In order to develop independent thinking one needs to make investments in their own growth and intellectual infrastructure. The style is clearly different between the two networks. Bloomberg TV is more like a newswire, reporting facts and figures with the odd nugget of real financial opinion. The presenters are robotic, institutionalised, lacking personality and insight. A significant amount of time is spent bouncing theories and ideas between presenters rather than key industry participants. CEO’s are lauded, rarely challenged, and it takes excessively long to delve into the key issues. Presenters nearly fall over each other and apologise profusely if they challenge consensus and that is a rare feature anyway. Viewers don’t have time for CEO teasers and long run-ups, they will switch and they have been. Charlie Rose, however, is electric.

CNBC is the prominent channel for business news. The criticisms are well publicised so there is no need to exhaust myself further in that direction. As a long-term investor short-term news is more noise rather than insight. It may validate and enhance an existing thesis or challenge it. The goal is to reduce cognitive dissonance, that being, the extent to which one harbours conflicting ideas around a particular hypothesis and the high degree to which one seeks to validate their decision despite a wide range of evidence that may disprove it, and the individual’s ignorance of that, nonetheless being aware of it. Okay, not a Webster’s definition but it can be erringly difficult to transfer thoughts from my brain to electronic paper on an early weekend morning.

CNBC gathers individuals from all spectrums, it’s pro-active and reactive and they do not procrastinate. Please bear in mind that these thoughts are generalisations, it is not an individual dissection of every facet of the two networks; humans are fickle and approach things with haste, unfortunately in some ways we need to respond to that need. The presenters on CNBC are more combative, challenging and are more educated generally in financial matters or at least more cognizant of the current financial questions and arguments. Again a generalisation. Furthermore, CNBC takes guests to task, they recall prior investment ideas and state how accurate they have been. Howard Marks’ recent investment letter ‘How Quickly They Forget’ also reminds us about the shortcomings and importance of investment memory.  One of the most memorable quotes from letter was “History doesn’t repeat itself, but it does rhyme” by Mark Twain. The full investment letter can be read here.

To reflect these points further a tribute below to Mark Haines and his combative style. As many have already noted, he didn’t take to fools lightly. I will miss the randomness, his complete way-with-all with CEO’s and his upbeat attitude and clever wit which made almost any static and slightly embarrassing television moments so easy to move on from. 

Some of the key highlights:

Exchange with Barney Frank
Vodpod videos no longer available.

Exchange with Martin Feldstein

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Jim Rogers video 17 May 2011

28 May


Steinhardt on Variant Perception

23 May

Charlie Rose: What is variant perception?

Michael Steinhardt: Variant perception is the effort to become sufficiently knowledgeable about whatever the subject is, that at a time to be at variance from consensus, because one of the few sure ways to make money in the market is to have a view that is off consensus and have that view turned out to be right.

Charlie Rose: Now is that contrarian? 

Michael Steinhardt: That’s not enough you have to be right. A contrarian is a plus, but it’s not enough. To be a contrarian is easy, but to be contrarian and to be right in your judgement when the consensus is wrong is where you get the golden ring and it doesn’t happen that much, but when it does happen you make extraordinary amounts of money. And in order to do that you have to be intellectually advantaged. You have to go through that same routine in terms of intensity, focus and commitment and the sorts of things that makes anybody in any area I think superior.

Charlie Rose interview with Michael Steinhardt (2001)
http://www.charlierose.com/view/interview/2766 

GM is down almost 10% since Steinhardt’s sell call

23 May

Government Motors (GM) is down almost 10% since Steinhardt’s call to sell GM “As quickly as I can. I don’t think one should be a long-term holder in government securities, particularly government equity securities.” Skip to 5.25 if you want to hear it again.

Vodpod videos no longer available.

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