The Lost Remote newsletter brings you the the best in streaming news, from staffing changes to premiere dates to trailers—to the latest platform moves. Sign up today.
That’s the question raised in an exhaustively detailed 10,000 word look at the collapse of Bear Stearns by Bryan Burrough for the August issue of Vanity Fair.
The article traces the origins of the Bear Stearns rumors, and focuses on the fateful Monday, March 10 (interestingly, Eliot Spitzer remembers the day differently) when CNBC, “the cable network that serves as Wall Street’s daily backdrop,” began reporting the rumors.
A CNBC spokesperson tells TVNewser, “We stand behind our reporters and our reporting.”
According to the article, it began with Bill Griffeth just after NoonET, quoting “rumors” that, “some unnamed Wall Street firm might be having liquidity problems.” Then it was Dennis Kneale, citing, “what one guy says.”
Later in the afternoon it was “the bane of Bear Stearns,” Charlie Gasparino, asking, “whether they should exist or not in the future,” before concluding, “Wouldn’t be the first time I was wrong.”
“Publicly speculating on a firm’s liquidity is akin to shouting ‘Fire!!!’ in a crowded theater; in catastrophic cases it can trigger panic selling,” writes Burrough. “It risks, in other words, becoming a self-fulfilling prophecy.”
A cable competitor tells TVNewser, “This is a major credibility hit for CNBC — their initial ‘reporting’ of rumors is tantamount to that of a gossip columnist. And if I’m a Bear Stearns shareholder, I’m filing a class action lawsuit against CNBC.”
Bear Stearns decided on David Faber to conduct the interview with CEO Alan Schwartz Wednesday morning, and, as Burrough writes, “Faber’s first question was a bombshell.”
“You knew right at that moment that Bear Stearns was dead,” said a Wall Street trader of 40 years.
Click continued to see the Faber/Schwartz interview that “killed” Bear Stearns, and one loaded quote about the behind-the-scenes “hate” at CNBC…
All the network’s talent — Gasparino, Maria Bartiromo, Faber, Larry Kudlow — had requested the interview, and whoever didn’t get it, Schwartz feared, might retaliate on the air. “Each of these correspondents has his own producer, and they all seem to hate each other,” one Bear executive told me. “If you choose Faber, you know Bartiromo will bash you the next day.” Schwartz directed Russell Sherman to identify the CNBC executive who supervised the correspondents, explain the situation, and ask that the correspondents who didn’t get the interview refrain from attacks. Sherman, however, couldn’t identify a single CNBC executive who seemed to have control over the correspondents. “Everyone on Wall Street knows the joke,” says another Bear executive involved in the discussions. “At CNBC, there is simply no adult supervision.”