Rational exuberance

Ken Clark kclark@homechannelnews.com

In more ways than one, this is the age of “Mad Money.” A huge television audience thrills at the spectacle of money manager Jim Cramer’s CNBC show, during which the host flails his arms and screams at his viewers to buy or sell certain stocks. Cramer’s show is a noisy, frantic success story.

Many of us, however, were brought up in the much quieter early days of “Wall $treet Week,” hosted by the late Louis Rukeyser. Back when the Dow Jones Industrial Average was in triple digits, my father controlled the television, and I watched along with him. This kinder, gentler program always began with Rukeyser’s trademark monologue, a witty and carefully crafted recap of the week’s financial events.

Our editors don’t get too excited about the daily fluctuations of the stock market. Our role is to provide news and analysis for the home channel. That means information for businessmen focused on boosting sales or cutting costs—not for investors speculating on future valuations.

Anyway, stocks go up, and stocks go down. Always have, always will.

But we have to admit, the capital markets have given us quite a show this summer. Since the Dow broke through the 14,000-point barrier in mid-July, shares of home channel companies have been knocked about a bit by the cruel swings of fate. Financial market news has grabbed headlines all summer—and not just in the business section.

Consumers are watching. Some are worrying, but not that much, according to a study from the International Council of Shopping Centers. The survey reveals that 46 percent of respondents who were aware of the market troubles did not change their spending habits and were optimistic that the financial markets would settle down soon. While that’s less than half, it’s still far and away the most common attitude of the 1,000 respondents.

The impact of jittery financial markets is being felt across the industry in ways that are still playing out—including the HD Supply sale. ( See story on page 4. )Again and again the word “volatile market” jumps about the financial news shows.

What can this editorial add to the din? Something I picked up from a 1970s episode of “Wall $treet Week”: “When it comes to the stock market, the man who says, ‘I don’t know,’ is the man who knows what he’s talking about.”

We don’t know what the markets will do, and neither do the majority of those who took our stock market poll. It’s more important for us to know what companies are doing in our market.

We’ve got two fine examples in this issue: Carter Lumber and Fairfax Lumber—Pro Dealers of the Year for 2007. You won’t see these companies on “Mad Money.” But you can read about them on page 13.

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