Monday, March 09, 2009

Why watching CNBC could destroy your life


It's August 2007. The Dow Jones Industrial Average sits at the 13,000 mark.

What did CNBC's talking heads recommend?

Ned Riley - says he's retired, living off of his portfolio and is 75% to 80% invested in stocks. Claims the U.S. market and even banks stocks are "attractively priced" and will generate 9 to 11% annually for the next ten or fifteen years. Grade: F-. Had you followed Riley's lead, you would have been completely wiped out.

Vern Haden - hard to pin down because he spews the usual platitudes, but basically posits that investors should stay the course. Grade D.

Peter Schiff - called the credit market meltdown perfectly, but whiffed on commodities, interest rates and the dollar. His call on gold was spot on ("spot on" -- get it?). Grade C+.

Lesson learned: the advice from CNBC's talking heads appears to be considerably worse than using darts to select stocks.


Hat tip: Market Oracle.


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