First, the backstory.
I was invited to go on CNBC on Friday to debate the merits of continuing to invest in 401(k) plans.
My position is that most 401(k) plans are terrible. They have high costs and expenses, poor investment choices, and uncertain tax consequences.
I was asked what investors could do as an alternative. I said CNBC could help investors make intelligent choices if it provided more "in Bogle we trust" and less "in Cramer we trust."
I assumed this would not go down well with the network that features Cramer as its financial oracle, but the events that followed could not have been predicted.
Cramer grabbed the mic and went ballistic. Perhaps he had read a previous post I did called What can investors learn from the unmasking of Jim Cramer?
His argument was that the indexes have been flat for 10 years and investors in the S&P500 had a lost decade. Since I can't convey his tone or manner, please see the video of his unscheduled cameo here (Cramer jumps in at the 3:30 mark):
After his tirade, I was able to explain that he knew nothing about Bogle's investment views. Bogle advocates determining your asset allocation and investing in a globally diversified portfolio of low cost stock and bond funds. Bogle never suggested anyone should invest solely in the S&P 500.
It is only by misrepresenting Bogle's views that Cramer can preserve his shaky status as someone who investors should take seriously.
After the appearance, I offered to debate Cramer in a longer format on TV or elsewhere. What are the odds?
Dan Solin is the author of The Smartest Investment Book You'll Ever Read and The Smartest 401(k) Book You'll Ever Read. His new book, The Smartest Retirement Book You'll Ever Read, will be published in the fall, 2009. Visit his website at Smartestinvestmentbook.com.
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