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Missing The Point Entirely

Speaking for the BubbleHeads*, Pethokoukis: So what is Stewart suggesting, that we “workers” just save insane gobs of money that we squirrel away into low-yielding savings accounts and rely on those savings and Social Security for our retirement? I’m not sure if Pethokoukis is kidding, but it seems as if he really doesn’t understand anything […]

Speaking for the BubbleHeads*, Pethokoukis:

So what is Stewart suggesting, that we “workers” just save insane gobs of money that we squirrel away into low-yielding savings accounts and rely on those savings and Social Security for our retirement?

I’m not sure if Pethokoukis is kidding, but it seems as if he really doesn’t understand anything Stewart was saying on the show. What Stewart was objecting to was the promotion of unrealistic expectations of large, quick returns on investment. At one point, Cramer tries to push back against Stewart by citing the period 1999-2007 as a time when these sorts of returns were considered normal, as if referring back to the artificially propped-up bubble fed by the Fed helps his cause, when what it does is drive home Stewart’s point. Hence Stewart’s constant refrains about “two markets.” In one market, Stewart was arguing, long-term investors, including my family and friends and probably a lot of you reading this, were conditioned to invest in equities on the assumption that they were not unduly exposing themselves to unacceptably high risk, while in the other financial institutions and their cheerleaders were creating instruments that greatly increased risks to everyone participating in the market and caused significant losses to the responsible, long-term investors through no fault of the latter or even of most of the companies in which they were/are invested. At no point did Stewart say or imply that people should not invest in the stock market. He did dare to suggest that work should matter (and he might have added that complicated financial instruments that are so impenetrably opaque that Soros and Buffett wouldn’t touch them with a ten-foot pole are inherently unsound and dangerous), which does not necessarily mean that he rejects investing. Americans might have benefited had he made an argument for saving (as a protection against exactly the sort of sudden and severe declines in the market that we have been seeing for the last many months), but that was not the matter under discussion.

* In honor of his attack on any critic of the TARP as a “MellonHead.”

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