'Today' Sends Mixed Signals on Markets
The NBC ‚ÄúToday‚ÄĚ show can‚Äôt seem to decide on an angle for its coverage of troubling developments on Wall Street over the weekend.
Host Matt Lauer declared a ‚ÄúCode Red‚ÄĚ for the economy on March 17, reporting that Bear Stearns ‚Äď once a highly respected investment bank ‚Äď tanked last week and was bought by JP Morgan Sunday night for only $2 a share.
Meredith Vieira, reporting from the floor of the New York Stock Exchange, called the Federal Reserve‚Äôs involvement in the buyout ‚Äúthe Fed‚Äôs most aggressive move since the Great Depression.‚ÄĚ
But while Lauer and Vieira were channeling Chicken Little, CNBC financial contributors urged caution, patience and even a hint of optimism.
‚ÄúSure, if you are an investor in Bear Stearns, an involved, an employee there, you are going to get impacted. But away from that we probably will not see a whole lot of fallout,‚ÄĚ CNBC‚Äôs Maria Bartiromo said. ‚ÄúYes, we‚Äôre going to see a very sharp decline in the financial services part of the economy today but I would be very, very hard-pressed to believe that this is an across-the-board cut in the economy and the industry overall.‚ÄĚ
‚ÄúMad Money‚ÄĚ host Jim Cramer said even investors with money in Bear Stearns aren‚Äôt necessarily ‚Äúin trouble,‚ÄĚ to use Vieira‚Äôs words.
‚ÄúIf you‚Äôre a diversified investor, you‚Äôre not going to get hurt. Those who only had their money in Bear obviously will get wiped out today,‚ÄĚ Cramer said. ‚ÄúBut you most importantly don‚Äôt have to take your money out of a bank. That‚Äôs what the Fed did this weekend. Your investments are fine.‚ÄĚ
Both analysts said there would be positive opportunities for investors in the wake of the Bear Stearns collapse. ‚ÄúI think there will be great opportunities away from the financials,‚ÄĚ Cramer said. ‚ÄúYour stock isn‚Äôt fine if you own a bank, but boy, if you have money at Merrill or Citigroup you‚Äôre going to be guaranteed. Do not panic.‚ÄĚ
Bartiromo even added some historical context, noting that in previous financial services crises, ‚Äúwhen you look at the market three months or six months after those major events, we actually have gains. So three or six months and beyond, you really want to be thinking long-term in this situation.‚ÄĚ
‚ÄúI traded in the 1987 crash,‚ÄĚ Cramer added. ‚ÄúIt turned out to be, six months later, the greatest buying opportunity in history.‚ÄĚ
Glimmers of hope and optimism amid ‚ÄúToday‚Äôs‚ÄĚ gloom-and-doom approach to the news.