Jon Stewart Pummels Jim Cramer: Transcript (3-12-09)

Here's the famous whoopin Jon Stewart gives Jim Cramer on his program, The Daily Show. Read the full transcript (video: part1, part2, part3). Excerpt below:

STEWART: How the hell did we end up here, Mr. Cramer? What happened?

CRAMER: I don’t know. I don’t know. Big fan of the show. Who’s never said that?

STEWART: Well, many people. Let me just explain to you very quickly one thing that is somewhat misinterpreted. This was not directed at you, per say. I just want you to know that. We threw some banana cream pies at CNBC. Obviously, you got some schmutz on your jacket from it. Took exception.

CRAMER: I think that everyone could come under criticism from it. I mean, we all should have seen it more. I mean, admittedly this is a terrible one. Everyone got it wrong. I got a lot of things wrong because I think it was kind of one in a million shot. But I don’t think anyone should be spared in this environment.

STEWART: So, then, if I may, why were you mad at us?

-Audience laughs-

CRAMER: No.

STEWART: Because I was under the impression that you thought we were being unfair.

CRAMER: No, you have my friend Joe [inaudible] on and Joe called me and said, ‘Jim, do I need to apologize to you?’ and I said, No. We’re fair game. We’re big network. We’ve been out front. We’ve made mistakes. We have 17 hours of live TV a day to do. But I—

STEWART: Maybe you could cut down on that.

-Audience laughs-

STEWART: So let me tell you why I think this has caused some attention. It’s the gap between what CNBC advertises itself as and what it is and the help that people need to discern this. Let me show you…This is the promo for your show.

CRAMER: Okay.

-"In Cramer We Trust” promo” plays-

STEWART: Isn’t that, you know, look—we are both snake oil salesmen to a certain extent-

CRAMER: I’m not discerning…

STEWART: But we do label the show as snake oil here. Isn’t there a problem with selling snake oil and labeling it as vitamin tonic and saying that it cures impetigo... Isn’t that the difficulty here?

CRAMER: I think that there are two kids of people. People come out and make good calls and bad calls that are financial professionals and there are people who say the only make good calls and they are liars. I try really hard to make as many good calls as I can.

STEWART: I think the difference is not good call//bad call. The difference is real market and unreal market. Let me show you…This is…you ran a hedge fund.

CRAMER: Yes I did.

-2006 video of Jim Cramer being interviewed on TheStreet.com-

CRAMER: You know a lot of times when I was short at my hedge fund and I was position short, meaning I needed it down, I would create a level of activity beforehand that could drive the futures. It doesn’t take much money.

-End video-

STEWART: What does that mean?

CRAMER: Okay, this was a just a hyperbolic example of what people— You had a great piece about short selling earlier.

STEWART: Yes, I was—

CRAMER: I have been trying to reign in short selling, trying to expose what really happens. This is what goes on, what I’m trying to say is, I didn’t do this but I’m trying to explain to people this is the shenanigans that—

STEWART: Well, it sounded as if you were talking about that you had done it.

CRAMER: Then I was inarticulate because I did] I barely traded the futures. Let me say this: I am trying to expose this stuff. Exactly what you guys do and I am trying to get the regulators to look at it.

STEWART: That’s very interesting because, roll 210.

-210 video-

CRAMER: I would encourage anyone who is in the hedge fund unit ‘do it’ because it is legal. It is a very quick way to make the money and very satisfying. By the way, no one else in the world would ever admit that but I don't care.

UNKNOWN: That’s right and you can say that here.

CRAMER: I’m not going to say it on TV.

-End video-

-Audience groans-

CRAMER: It’s on TV now.

STEWART: I want the Jim Cramer on CNBC to protect me from that Jim Cramer.

CRAMER: I think that way you do that is to show—Okay, the regulators watch the tape, they realize the shenanigans that go on, they can go after this. Now, they didn't catch Madoff. That’s a shame.

STEWART: Now why, when you talk about the regulators, why not the financial news network? Isn't that the whole point of this? CNBC could be an incredibly powerful tool of illumination for people that believe that there are two markets: One that has been sold to us as long term. Put your money in 401ks. Put your money in pensions and just leave it there. Don’t worry about it. It’s all doing fine. Then, there’s this other market; this real market that is occurring in the back room. Where giant piles of money are going in and out and people are trading them and it’s transactional and it’s fast. But it’s dangerous, it’s ethically dubious and it hurts that long term market. So what it feels like to us—and I’m talking purely as a layman—it feels like we are capitalizing your adventure by our pension and our hard earned money. And that it is a game that you know... That you know is going on. But you go on television as a financial network and pretend isn’t happening.

CRAMER: Okay. First, my first reaction is absolutely we could do better. Absolutely. There’s shenanigans and we should call them out. Everyone should. I should do a better job at it. But my second thing is, I talk about the shorts every single night. I got people in Congress who I’ve been working with trying to get the uptick rule. It’s a technical thing but it would cut down a lot of the games that you are talking about. I’m trying. I’m trying. Am I succeeding? I’m trying.

STEWART: But the gentleman on that video is a sober rational individual. And the gentleman on Mad Money is throwing plastic cows through his legs and shouting “Sell! Sell! Sell!” and then coming on two days later and going, “I was wrong. You should have bought, like-I can’t reconcile the brilliance and knowledge that you have of the intricacies of the market with the crazy bullshit you do every night. That’s English. That’s treating people like adults.

CRAMER: How about if I try it?

STEWART: Try what?

CRAMER: Try doing that. I’ll try that.

STEWART: That would be great, but it’s not just you. It’s larger forces at work. It is this idea that the financial news networks are not just guilty of a sin of omission but a sin of commission. That they are in bed with them.