Posts filed under “Financial Press”

Farewell To Ben Stein

Its time to bid a not-so-fond adieu to the New York Times columns of Ben Stein.

No, he is not leaving the paper. Rather, we’ve reached the point where Stein’s commentary has become detached from reality, so ridiculously fabricated, that it can no longer be read. Indeed, its become so absurd that not only have I decided to skip reading him, I am immediately making the public commitment to stop commenting on his Tom Foolery.

Quite a bit of electrons and pixels have been spilled needlessly over the past few days in response to his most recent exercise in inane rhetoric, illogic, and fallacious reasoning. (No, I am not referring to this WSJ article). Across the blogosphere, smart insightful people have wasted far too much time and effort dispelling the absurdities that take residence in Stein’s columns.

Its time to put a stop to this.

I frequently mention that I loathe ad hominem attacks. They are a lazy way to avoid responding to a challenging argument. However, there comes a certain point in a pundit’s career arc where their credibility, intellectual honesty, and quite bluntly, their entire world view comes into question. Mr. Stein is at that point; he has jumped the shark, and its time for the rest of us to move on.

Stein, a former Nixon speechwriter, has made his opposition to Darwinian Evolution public. He is idealogically committed to creationism and intelligent design, and is the star of the upcoming documentary Expelled: No Intelligence Allowed. Once a commentator eschews logic and reason, once they deny science, then their readers are forced to question their entire analytical approach to ANYTHING — be it economics, markets, stocks, whatever. Ideology trumps facts, theory trumps data. For better or worse, this is the turf Stein has staked out as his own.

But its more than mere creationism. Stein’s entire view is a denial of reality. He seems to be committed to throwing up smoke screens, obscuring what is really going on. This is unforgivable.

We see this ideological absurdity carried to an extreme in his recent Sub-prime real estate and finance  columns.

I first noticed this inanity in the August 12 2007, column, Chicken Little’s Brethren, on the Trading Floor. Stein made the foolish argument that because sub-prime was so tiny relative to the US Economy, it was meaningless. Imagine an oncologist saying to a patient:  "Well, Mr. Jones, relative to your body mass, its only a 15 gram tumor, so I wouldn’t worry too much about it."

If Stein actually believed this gross oversimplification, I would dismiss him as just another clueless bobblehead. However, I believe he is marginally more intelligent than that. That makes me wonder if this column is purposefully misstating facts. Remember, Stein does not manage assets for a living, and was a political speech writer for Nixon. Everything he writes has a subtle political connotation — even if it ends up costing people a lot of money. Thus, the better explanation of his errors is that he is not merely clueless, but willfully misstating the US Economic situation for political purposes.

Perfect example: On October 21, Stein top-ticked the market with this pollyannish column: The Gloomsayers Should Look Up. Then came a dishonest criticism of Goldman Sach’s Economist, Jan Hatzius — who may I point out was correct in raising red flags that sub-prime was an increasing economic problem. Stein criticized Hatzius, writing:

"That worthy scholar recently wrote a detailed paper about how he thought the subprime mess would get worse and worse. It would get so bad, he hypothesized, that it would affect aggregate lending extremely adversely and slow down growth . . . Is it possible that Dr. Hatzius’s paper was a device to help along the goal of success at bearish trades in this sector and in the market generally? His firm says his paper, like all of its economists’ work, was not written to support any larger short-trading strategy. But economists, like accountants, are artists. They have a tendency to paint what their patrons, who pay them, want to see."

Of course, we actually found out later that Goldman had made their bets many, many months before, and that Hatzius, if anything, understated the degree of the problem.

The final straw, as far as I am concerned, came this past weekend.

Rather than admit his error, Stein went a completely different way: He blamed the sell off on traders. (Can Their Wish Be the Market’s Command?) It was the last bit of idiocy from him anyone should tolerate. Forget the fact that Stein missed the importance of the sub-prime debacle, that the economy has continued to decelerate, that the job market continues to soften, that the situation had become dire enough that it forced the Fed to make the biggest single one day emergency cut in its history. Stein chose to ignore all of that — and blames the sell off on traders.

Compare Stein’s work with that of another NYT business columnist, Mark Hulbert: Its always data driven, thought provoking intelligent analysis. Hulbert seems to have no political agenda, no bull or bear bias — he merely takes a run of interesting data, and reaches supportable conclusions. He is the Anti-Stein.

Other about the blogosphere have similarly identified  Stein’s foibles:

Dealbreaker called "bullshit on this uncheckable story Stein uses to illustrate an unsupportable theory."

Doug Kass has repeatedly taken apart the dissemblings, poor reasoning, and unsubstantiated theories.

Paul Kedrosky asks "Why does the NY Times continue to run this drivel?"

Roger Ehrenberg says that “Lying with Statistics” is Ben Stein’s Modus Operandi   

Henry Blodget says "Ben Stein Is An Idiot"

Science Blogs agrees, noting: "Ben Stein must be on a campaign to make himself look stupid."

Yves Smith: Ben Stein Tells Us It’s All the Traders’ Fault   

•  Marek Fuchs finally exclaims Ben Stein Must Be Stopped!

This is quite a waste of intellectual firepower.

I’m finished with his misleading political hackery, his absurd wingnuttery. To be blunt, its time for intelligent people to stop wasting time arguing with him, and apply their energies more productively than on his economic Tom Foolery.

There’s an idea: I propose the phrase "Ben Steinery" be substituted where ever you would have used the phrase "Tom Foolery" in an economic context.

But read his absurdities, or respond to his inane commentary? I’m done.

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