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CNN IN THE MONEY

Interview with James Stewart; Bloggers Are Changing Mainstream Media

Aired February 20, 2005 - 15:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(BEGIN VIDEOTAPE)
ANNOUNCER: From New York City, America's financial capital. This is IN THE MONEY.

(END VIDEOTAPE)

JACK CAFFERTY, HOST: Welcome to IN THE MONEY. I'm Jack Cafferty. Coming up on today's program:

So much for plan A: Iraq's new government is not shaping up the way Washington had planned. We'll see what that could mean for relations down the road between the United States and the country where our troops are fighting.

The rise of the blogocracy: The bloggers are changing the way the mainstream media does its business. Maybe that's a good thing. We'll look at whether they're guarding of the truth or simply a digital lynch mob.

And stand up and fight like a mouse: Get the story of the moguls who battle for control of that small world called Disney. We'll talk to the author of a widely anticipated new book "Disney wars."

Joining me today a couple of IN THE MONEY veterans. CNN correspondent, Susan Lisovicz, "Fortune" magazine editor-at-large Andy Serwer. The first professional sport in the history of this republic to ever cancel an entire season, the National Hockey League, called it quits this last week. There'll be no games.

ANDY SERWER, "FORTUNE" MAGAZINE: Yeah, the fact that I can't watch the Nashville Predators and the Mighty Ducks and the Columbus Blue Jackets is obviously weighing heavily on me that the moment. No but seriously, I mean, you know, those are these teams -- there are too many teams. They expanded, they over-expanded. They ruin the league. They ruin the league. I mean when you have the Rangers and the Flyers and the Bruins and the Habs (PH) and those teams, that was fine. They just over-expand. They blew it, big time. It's unbelievable. It's a great game, but they blew it. They just blew it.

SUSAN LISOVICZ, CNN CORRESPONDENT: And fans are bitter, and of course fans are the ones who get shafted, but I have to say, I don't come from a hockey family. I have been to hockey games, they're great fun. I never saw more excitement in the newsroom than when the Stanley cup came to CNN. There was an interview and some people came. Men and...

SERWER: That's because it's filled with booze.

LISOVICZ: No, no, no, men and women were like little kids. They were so excited about this very fabled trophy and one of -- and of sports, you know, one of the great sport in America, North America and it's gone for the season.

CAFFERTY: Well, it's not only just the fans that get hurt either, it was pointed out the vendors and the parking lot attendants, people who work at these stadiums, et cetera, et cetera, the administrative staff of these organizations. I just wonder though, it's in a way reminiscent of baseball a few years ago when they the strike and we lost a good portion of the season and fans were furious and yet baseball is back and it's bigger and better than its ever been. Why can't hockey maybe do the same thing, or can they?

SERWER: Well, hockey was turning downwards anyway. I mean, the aposity of stars was a problem, the expansion was a problem, too. I think that, you know, they said it's the yawn of a new era, the guy at "Sport Illustrated" said, here. He said that Canadians didn't even care. And Ken Dryden, I think said that

(INTERRUPTED BY LIVE EVENT)

CAFFERTY: Not sure what term "blog" means? Well, ask Dan Rather or former CNN executive vice president and chief news executive Easton Jordan. Their reputation and their careers began to take serious hits after some so-called blog reports were picked up by the mainstream media.

Joing us for more on this trend and for an explanation that will help me understand more about it, because I'm a little fuzzy on this subject myself, Howard Kurtz, a media critic with the "Washington Post" he's also the host of CNN's "Reliable Sources."

Howard, nice to have you with us.

CAFFERTY: Tell me where bloging fits in to the journalism community. If I have a computer, suddenly I'm a journalist or is that much an oversimplification.

HOWARD KURTZ, THE "WASHINGTON POST": All you need, Jack, is a mouth and a modem. There are about eight million people who have these web logs, or blogs. Some of them are, you know, junior high school girls writing about their date on Friday night, but a lot of them are self-appointed writers, opinionaters, bloviators (PH) and researchers and lawyers who have something they want to share with the world and as you just mentioned on the set-up, they are becoming increasingly influential, particularly as a check, as they see it, on the old dinosaur mainstream media.

SERWER: Yeah, I want to follow up on that, Howard, because I don't think it's a coincidence that the blogs have brought down, if you will, two media guys, Easton Jordan of CNN and Dan Rather. Does that suggest to you, then that we, in the media, are protecting our own to an extent?

KURTZ: Well, look. We all, by which I mean people who work for big media company, kind of controlled the news agenda for decades. And we kind of liked it that way, it was very comfortable for us. Now, in a digital age, you know anybody who does a little bit of research or gets on Google or uses an Excess database can pop something, and that can be picked up by other blog, and there's this sort of a chain reaction. I mean, this is what happened with the questioning those, apparently, bogus National Guard documents that led to the discrediting of Dan Rather's story on President Bush. And so they've became part of the conversation whether we like it or not. Now, there is no check on them, they have no editors, they have no lawyers, they have no bosses. They can say anything they want and that is both the promise and the peril of blogging. In other words it's exciting to hear what people have to say, unvarnished, unfiltered, but on the other hand they also have the freedom to be irresponsible and even wrong.

LISOVICZ: But, Howard, do both of those lessons teach us anything? Because I always learned that perception can be as bad as reality. When you get to a certain level, where the cyberspace noise is so loud, it would almost seem that a company, where credibility matters a lot, feels compelled to respond. In the CBS case, for instance, there was no internal investigation that was done for quite a while and that really seemed to heighten the criticism. Do you think that there should be new guidelines written so that things aren't done as rationally as some these accusations flying off in cyberspace?

KURTZ: Well, the thing about the blogisphere is that there are no guidelines and you couldn't get all these disparate people to play by anybody's rules.

LISOVICZ: Guidelines for companies like CNN, say.

KURTZ: Well, I mean, they don't need guidelines, what they need is common sense. News moves at the speed of light these days. You can't now take two weeks to decide what you want to say. You can't go into the bunker. CBS, to take that example, took 12 long days during which Rather and the top executives of that news division repeatedly and doggedly and staunchly defended what everybody else could see was a fraud set of documents on which they based that report about the president. You can't get away about that anymore. It only imflames the blogisphere, and the other thing that it does, is that the bloggers have the power to push a story into the mainstream media. Sometimes the media are slow or reluctant or just clueless about something that is going on in cyberspace, but if they make enough noise, and we've seen this time again now. Most recent example involving the discredited White House reporter, Jeff Gannon, and his colorful past. They can force, pretty much, newspapers and magazines and television networks to cover a story that they otherwise might have slept through.

CAFFERTY: But you mention the news moves at speed of light, isn't that exactly the peril in the Dan Rather story? There was a rush to get that story on the air because of the timeliness if it in regards to the presidential election campaign, that is considered by some of the investigators as being right at heart of the problem that CBS had with that whole thing. They didn't take their time. They didn't check. They didn't vet the story the way they should have. They rushed so that they could compete with news at the speed of light.

KURTZ: And that's exactly the point that some of these bloggers make and they're both conservatives and liberals out there that often try to bash the other side. I mean, CBS put those documents on the air five days after Dan Rather's producer obtained them, absurd looking back when you saw all of those problems with those pieces of papers. And so, when people say, well you know, you bloggers, you're not trained, you're not journalists, you don't have licenses how can we believe to what you say? They just point to example like CBS and other high-profile media mishap, Jason Blair with the "New York Times" Jack Kelley of "USA Today" and say, look, you folks make a lot of mistakes, too. We call you on it, we're going make you more accountable. Now, blogs make mistakes and I think people on our side of the business also have to report on the excesses of the internet when something like this bubbles up.

SERWER: Howard, just quickly here, how do the traditional media organizations take a look at this? I mean, you look at something like that John Kerry story about him having him an affair, that was all over the blogs and turned out not to be true. The Gannon thing doesn't picking up much steam. How do traditional media look at it and decide what to report out of the blogs?

KURTZ: Well, they have to be very careful and they have to obviously double check and triple check, you don't just put in the paper or put on CNN something that some blogger says. But they can be an important, sort of, guidance system for what's brewing out there and I think that news organizations have got to learn to adjust to live in this new world because otherwise it's like sticking your head in the sand. When television came along, newspapers didn't like it, but they had to learn to compete.

SERWER: All right, our colleague, Howard Kurtz who is the host of CNN's "Reliable Source" which I suggest you watch all the time -- regularly. Also of the "Washington Post."

Howard, thanks for coming on the program.

KURTZ: Thank you.

SERWER: Coming up after the break:

It'll take more than a free clock radio to finesse this one: Circuit City faces a takeover bid in the billions. See how Wall Street is reacting.

Plus, smiling on the outside: We'll speak with an author who looked behind the happy faces in Disney management. Find out what he learned about the Eisner years.

And leadership consultant who's been dead for centuries? We'll hear about how Shakespeare could help a modern manager work better.

(COMMERCIAL BREAK)

LISOVICZ: Now, let's take a look at the week's top stories in our "Money Minute."

Attorneys for former WorldCom CEO, Bernie Ebbers, laced into star prosecution witness Scott Sullivan in Ebbers' fraud trial. The former WorldCom finance chief admitted he lied to investors, Wall Street analyst, and the company's board, but Sullivan would not back down from accusing former CEO Ebbers of knowingly orchestrating the company's $11 billion accounting fraud.

Still no solid sign of a cool down in the realerk state market. Housing starts unexpectedly rose to a 21-year and high in January. The biggest gains were in construction of single family homes.

And we're closer to seeing a huge increase in fines the FCC can slap on broadcasters for indecency. The House passed a bill boosting the possible fine for broadcasters to $500,000 from $32,000 for each violation. The number of indecency complaints filed with the FCC has jumped from about 100 in 2000 to more than one million last year. It should be said half of those complaints were tied to the Janet Jackson wardrobe malfunction. You might have heard of it.

SERWER: Many of you probably know Wal-Mart has been challenging Best Buy for the top spot in American electronics retailing, but where does that leave smaller players like Circuit City? Apparently it makes them a takeover target.

A Boston hedge fund put up a $3.25 billion offer for Circuit City just the day before the company announced its closing 19 superstores and a distribution center. Circuit City shares have been on a bit of a rise over the past two years, but they've been basically treading water since falling sharply in 2000. That makes Circuit City our "Stock of the Week"

And, you know, this business could be a dinosaur of a business. You've got Best Buy versus Circuit City, those two stocks have been all over the place, but Best Buy has been beating up Circuit City. Wal-Mart, as we said, is in the business. Target's in the city -- in the business. Dell sells consumer electronics to a certain extent online. Amazon is a huge seller of electronics online. So, you have to wonder when kind of future does this business have.

CAFFERTY: And why did this would hedge fund want to go and take it over and perhaps take it private, if they get it.

SERWER: Well, I think the answer of that with the hedge fund thing, is that there's so much money flowing in hedge funds right now that they can't be satisfied just buying little bits of pieces of companies, they have to go for the whole thing.

LISOVICZ: Right, and being private of course you're not under the microscope every quarter like, you know, public companies. So could give it a little breathing room, but having said that, there's just such tremendous pressure either from the big box stores, like the Wal-Marts or the Best Buys which are creaming them and I see that the chain posted losses in each of the last three quarters, just a terrible performance and very, very vulnerable, right now.

SERWER: And the hedge fund thing is interesting, just to continue on that a little bit, because we saw Eddie Lampert, you know, he was the guy behind the Sears-Kmart deal.

CAFFERTY: Right.

SERWER: He got involved in Auto Zone, AutoNation. So, these guys have so much money, they literally don't know what to with it. And the consumer electronics, on the other hand, remember all of these regional chains like "Crazy Eddie?" He got in a little bit of trouble, that guy. Remember him?

CAFFERTY: A little? He went to prison.

SERWER: He went to the joint.

And PC Richards is around, everyone's got them all over the country, but I think, you know, they called them roll-outs, where you're going to see these things consolidate massively. I really think that's what's going to happen. And the probably the future's online in this business, because it's such a commodity business. I mean, if you know you're going to buy a boom box, why not buy it cheap on-line?

LISOVICZ: A lot cheaper to operate.

SERWER: So, you're probably not go out and buy a couple of thousand shares of Circuit City here this afternoon?

SERWER: No, I would recommend buying Circuit City a week ago.

CAFFERTY: Yeah.

LISOVICZ: He'll buy a flat screen TV, but he'll buy it from another location.

CAFFERTY: There you go.

SERWER: Yeah, that's got to be it. All right, we'll be following that one.

Coming up on IN THE MONEY:

Cat fight in the mouse house: Find out about Michael Eisner's turbulent time at the Magic Kingdom. We'll speak with the author of "Disney Wars."

Also ahead, me thinks the lady duth invest too much: Shakespeare goes business in a new management training trend. Find out how it works.

And just dumb enough to be smart: We'll show you some weird inventions from Japan on our "Fun Site of the Week."

(COMMERCIAL BREAK)

LISOVICZ: The name Disney may conjure up thoughts of furry woodland creatures, fairy godmothers and prince charming. But our next guest says you won't meet any of those characters at the company's corporate headquarters. The trials and tribulations of Michael Eisner's reign as CEO is scripted in the new book "Disney War." Author James Stewart join us now. Welcome and congratulations.

JAMES STEWART, AUTHOR, DISNEY WAR: Thank you.

LISOVICZ: Of course, there's a lot about Michael Eisner in there. But it comes at an especially pivotal time, because it's the time everyone's talking about Michael Eisner's successor and your book, for the first time, details some of Eisner's own doubts about his handpicked successor.

STEWART: Well, that's certainly true and he's had, by the way, doubts about everyone who I think...

LISOVICZ: other than himself.

STEWART: ... challenged his power, other than himself. But it is an historic moment for Disney. I mean Eisner is completing a nearly 20-year tenure, the last 10 years of it pretty much in absolute control there. He has announced that he's stepping down. The board is seeking a new CEO. The big question, will it be his handpicked belatedly handpicked successor Bob Eiger or not? And the story shows that at repeated times over the years Eisner was extremely critical of Eiger and so much so that at one point, Tom Murphy, the highly respected former chairman of Cap Cities ABC and a member of the Disney board, called Eiger on his vacation and said, Bob, you have got to quit, you cannot stay here, Michael does not have any confidence in you.

CAFFERTY: You were given almost unprecedented access to the Disney company and perhaps under the heading of it's better to be lucky than good, this is not the book you started out to write, is it?

STEWART: Well, no, it's not and while I was in the midst of writing this a pretty familiar presence around Disney's Burbank headquarters, Roy Disney, the nephew of Walt Disney, a Disney board member and the head of the animation department there, abruptly resigned after being pushed -- he was going to be pushed out by Eisner and the board, and declared war essentially on Eisner and led an amazing sort of national shareholders campaign to get rid of Eisner.

ANDREW SERWER, "FORTUNE" MAGAZINE: Jim, it's interesting, you talk about Eiger and of course Eisner did the same thing to Katzenberg and the same thing to Ovitz, so he had a history of doing this to his successors. He does not have a lot of friends in Hollywood, maybe no friends at all. But I want to ask you this, aren't all Hollywood CEOs and moguls megalomaniacs? Aren't they all like this?

STEWART: I haven't done an investigative book on all of them, but I have to say I do feel that Eisner is in a class of his own, if for no other reason, he has lasted for so long. In this Machiavellian treacherous environment, that is no small achievement. Now is there lying in Hollywood? Yes, but I have to say, in my career, reporting on Wall Street, on Washington, other fields, I've never encountered it as blatantly and with as many harmful consequences, as I did at the top of the Disney company.

LISOVICZ: But the irony is, is that now Disney is on it seems, more sturdy footing. For instance, ABC is coming back by a team by the way with lost and "Desperate Housewives" that was sacked --

STEWART: that was fired for that show, yes.

LISOVICZ: Also the weak dollar is sending a lot of overseas visitors to the theme parks. So Disney ironically is financially a little bit more secure.

STEWART: It is doing better and some of that is cyclical. Some of the things that hurt Disney were beyond their control. But there nonetheless, has been some huge blunders, more than $1 billion mistakes. The disaster of building euro Disney, the foray into the Internet, the acquisition of the ABC family channel. Not to mention turning down hit shows like the "CSI" franchise, turning down "The Lord of the Rings." I mean (INAUDIBLE) hiring -- pushing out Jeffrey Katzenberg. I mean the catalogue of errors, however well Disney is doing -- and it is doing better, as you say -- it is staggering to think how great it would be doing if even a few of those decisions had been better.

CAFFERTY: Maybe it would be better at looking at how the board survived at the Disney Company. Because they allowed Eisner to sit there and do all this and they kept signing off on him. No CEO serves without the board saying it's OK.

STEWART: I think perhaps the most important theme in the story is the role of the board. And the Disney board was really a textbook case of how boards let down shareholders and let down constituencies of the company because they were so easily manipulated and lulled into complacency by a CEO like Michael Eisner.

LISOVICZ: ... so close to him, right?

STEWART: There were many conflicts of interest. The most glaring was the fact that his personal lawyer was on the board, was head of the compensation committee --

LISOVICZ: What's wrong with that?

STEWART: And negotiated Eisner's own employment contract for Eisner with Disney.

CAFFERTY: Unbelievable.

SERWER: What about, what about your crystal ball here? Is Bob Eiger going to run this company or what's going to happen? Will they merge with Dreamworks? Will Jeffrey Katzenberg return? I mean, what do you think is going to happen?

STEWART: As I said, this is an historical juncture. The board is going to have to make a critical decision about the successor. Bob Eiger is a very nice guy. He's the only leading internal candidate. But I think he carries tremendous baggage from his years and among other things, they'll still be at war with Roy Disney and his ally Stanley Gold (ph) and I think one of the first tasks of a new CEO is to bury that hatchet so the kind of civil war in the kingdom can come to an end and they can build on their legacy and move forward. But then anything could happen. I mean the real issue, is the model of the entertainment industry going to be the fully vertically integrated, massive conglomerate like a News Corporation or is it going to be the creative boutiques like Pixar and Dreamworks? And right now the market is putting a higher multiple on those creative boutiques.

LISOVICZ: We talk about how many things that Disney has done wrong, retention of talent, succession plan, bad decision making. The fact that there are no external candidates being interviewed publicly - I mean there's nobody out there on the horizon, would you consider that yet another blunder?

STEWART: Well, if they never interview an external candidate, I'd say it would be a blunder.

LISOVICZ: But the timetable is coming up.

STEWART: It is, but I think there's time. There's plenty of time. I think the board at its worst, after that historic shareholder vote last year repudiating Eisner's leadership and by the way, withholding many votes from the directors including George Mitchell, I think that did send a powerful message and I think they have woken up. It's a new era of shareholder democracy. They owe to the shareholders. They owe it to the company to do a very thorough search and get, as they promised, the best single individual to run this great institution.

LISOVICZ: One can only hope. James Stewart, author of "Disney War, the Battle for the Magic Kingdom." Thanks so much for joining us.

STEWART: Thank you.

LISOVICZ: There's lots more to come here on IN THE MONEY. Up next, wherefore art thou CFO? Find out how a shot of Shakespeare can put a classic twist on a manager's style.

Plus de-inventing the wheel. On our fun site of the week, check out some inventions that look better than they actually work.

(COMMERCIAL BREAK)

SERWER: If the biggest role Shakespeare has played in your life was keeping you off the honor role in high school, it might be time for a second read. My next guest says "Hamlet," "Henry V," "Julius Caesar," "The Tempest," can all teach you a lot about your life and career. Carol Adelman is director of Movers and Shakespeares, a business that is teaching leadership to corporations and the military through Shakespeare play. Welcome, Carol. CAROL ADELMAN, MOVERS AND SHAKESPEARES: Thank you.

SERWER: Listen, a lot of people are going to be skeptical about this I guess. I frankly am a little skeptical. Can you please just lay out how this works, how Shakespeare can teach business and military people anything about anything?

ADELMAN: Well, Shakespeare is phenomenal. And most people were probably like me. They slept through King Lear their senior year. And it wasn't until I married my husband who was a Shakespeare nut that I began to learn the fantastic wit and wisdom of Shakespeare. And we then began to apply this to leadership. And I think there's three reasons. First of all, Shakespeare had the greatest insights into people. And every great leader has to know what makes people tick. Second, he told the greatest stories. And we think you learn best through stories. And third, he had the most beautiful language. And it really takes beautiful language to inspire and motivate people and get the job done.

LISOVICZ: But, you know, Carol, let's face it, when you're in the trenches and you're under fire, you're not saying ah, the slings and arrows of outrageous misfortune --

SERWER: Ah, very good, Susan.

LISOVICZ: I remember that from high school. We all had to memorize -- my inner Shakespeare. But seriously, how does it facilitate our men and women in uniform who are in very harsh circumstances?

ADELMAN: Well, Susan it sounds like you didn't sleep through King Lear your senior year. I'm very impressed.

LISOVICZ: Thank you.

ADELMAN: A-plus. Well, I'll tell you and the St. Crispin's (ph) Day speech from "Henry V," is probably the most famous, was played on the boats going over to Normandy. It was read to men in the Persian Gulf war by General Tom Drowdy (ph) in February and when he was taking a small platoon in to clear minefields before the invasion of Kuwait and he read it to his men before they went in. So it was also -- there were copies of it going around the Internet before the Iraq war. So that's the famous phrase "we few, we happy few, we band of brothers." So it's a great speech and it's definitely been used as has the speeches in Julius Caesar, "friends, Romans countrymen." And this speech by Mark Anthony is used as an example of how to make a speech, whereas Brutus' speech is used on how not to make a speech.

CAFFERTY: There's obviously a little lighter side to this. I'm reading some of these notes. It says here, you say I've seen more men in tights than anyone. We dress the top executives up in full Elizabethan garb and then have them read quotes out of context. It is great fun. Do these guys like this? Some of the CEOs I've met might be, how shall we say, resistant to making a bit of a fool of themselves, at least on purpose? ADELMAN: One of the things I've learned that there's really a little bit of Elvis in everyone, the ones that you would least suspect. So it doesn't take long before they get fully into the roles. In fact we always have two roles that we like. We usually put the CEO as the king --

CAFFERTY: Excuse me, I don't know if you can see the monitor -- we've got a guy, it looks like he's got a bowl of fruit on his head. I mean there is no way, I don't care what he's saying. All you've got to do is look at this. I'm not going to take it seriously.

ADELMAN: You will, we just don't put mirrors in the dressing room.

CAFFERTY: I'm sorry, I didn't mean to interrupt. Go ahead.

ADELMAN: No, no problem.

CAFFERTY: These guys get into it and actually enjoy this, I guess.

ADELMAN: They do get into it. And really, theater is transformational. Everybody loves theater. Everybody loves the fourth grade play they were in, whether they were just the plant waterer or whatever it was.

CAFFERTY: Spear carrier (INAUDIBLE).

SERWER: Carol, I actually was a tree in my third grade. I did a pretty good job.

LISOVICZ: That explains a lot.

SERWER: There's a little bit of theater actually here on IN THE MONEY maybe you've noticed. Let me ask you, do you see any of these plots, like "King Lear" and "Hamlet" and "Macbeth," do you see them any time writ large in society, I mean when you see power plays like let's say at Disney, does that remind you of Lear or things like that. Do these things come to your mind?

ADELMAN: Well, King Lear, to our mind, when we teach it, is the best example of succession planning. You know, he really didn't know how to do it. He needed an estate planner with him. He should have thought it through better. He should have known when to quit. He stayed too long when he was into his dementia. So we teach that for succession planning lessons.

LISOVICZ: OK so Carol we're going to continue on the Shakespearian theme. Who would be your corporate "Hamlet," to be or not to be?

ADELMAN: Corporate "Hamlet," boy. I would say kind of -- probably a conglomerate, conglomeration. And that would be the CEOs who really have not bitten the bullet on the fiscal accountability and they're trying --

LISOVICZ: Oh, there's so many of them, Carol.

ADELMAN: Well, that's why I'm having trouble singling out one. And I think that's just a key, key issue today. And it -- you know, people -- I think corporate boards and CEOs were sitting around and not grabbing this bull by the horn. And they were doing the "to be or not to be" thing and they needed to just handle it.

CAFFERTY: What Shakespearian character does Donald Trump bring to mind?

ADELMAN: Donald Trump. I think Donald Trump clearly a "Henry V," OK? I mean he is - Donald Trump is once more unto the breach, dear friend, once more, if I've ever seen it, wouldn't you say?

SERWER: Sure, the bard knew it.

LISOVICZ: Carol Adelman, she knows her Shakespeare. She is the director of Movers and Shakespeares. Thanks so much for joining us. Coming up, he's IN THE MONEY. Find out how a cameo on our fun site of the week took a kid from obscurity - there he is -- to celebrity. And here's a chance to grab your own piece of the limelight. We just might read your comments on air. Write to us at this address, inthemoney@cnn.com.

(COMMERCIAL BREAK)

CAFFERTY: Usually, when we report about a painting selling for big bucks at a ritzy auction, we're talking about something by Picasso or Pollack. But two paintings of dogs playing poker fetched almost $600,000 this week. Allen Wastler us here to explain that. Absolute lunacy, I say and to fetch us a good fun site of the week.

ALLEN WASTLER, MONEY.COM: It's great art, great art.

CAFFERTY: It's just silly.

WASTLER: By Casius Coolidge (ph), this is part of Americana, but three reasons why this auction -- they're expecting these two paintings. The first one is the "Big Bluff," and the second one is "Waterloo 2" and showing those darling dogs just playing poker. It's great. But three reasons why this probably went higher -- they thought it would get like 50 grand. Instead, more than $500,000. One, the Internet. That's what it makes me here, you know, the Internet. You get wider awareness of it, more ability to get in on the bidding. It was done by Doyle, but people could submit bids over the net. Two, we had the dog show in town so there was a little bit of excitement. Three, poker is big business these days. I mean poker is all over the place.

LISOVICZ: Somebody called it bona Lisa.

SERWER: You've got dogs, poker and the Internet, that's just an unbeatable combination.

WASTLER: It's a slam dunk. And I am surprised and shocked, Jack, that you don't appreciate -- SERWER: Come on Jack. Get with the program, it's great stuff.

CAFFERTY: My tastes in art run at a much higher level than dogs playing poker (INAUDIBLE).

WASTLER: Elvis on velvet, here we come.

CAFFERTY: That, too. What about the fun site of the week?

WASTLER: Well, first of all, I want to give ourselves a pat on the back. Remember that...

CAFFERTY: This is funny, I saw this on the paper, Dutch boy.

WASTLER: We put him on and it just took off. It turns out he's from New Jersey.

LISOVICZ: Of course.

SERWER: Like Hagan Daz (ph). He's like Hagan Daz.

WASTLER: We love this guy but we threw him on IN THE MONEY as one of our fun sites a couple weeks ago. His fame has taken off. He did a little posting saying, "I was on CNN on this show about money and finance and stuff."

SERWER: That's the good part right there Allen, see when he does that, when he starts getting down.

WASTLER: You go, boy. You go.

LISOVICZ: He's demonstrating on all the morning talk shows like GMA. He's proud of himself.

WASTLER: He's all over the place and somebody in our CNN household tried to take credit for putting this -- us. It was us.

CAFFERTY: It was right here.

WASTLER: We make the cyber stars.

CAFFERTY: Wait a second. Who tried to take credit?

WASTLER: Somebody on primetime.

CAFFERTY: Who, we want names here.

WASTLER: Your buddy, Anderson.

CAFFERTY: Anderson Cooper, I'm looking for you. He did?

WASTLER: Yes, sir.

CAFFERTY: I'm told he rescinded it.

WASTLER: Oh, he rescinded it? CAFFERTY: Yeah, yeah.

WASTLER: Wise move. Don't mess with the Jack man.

CAFFERTY: So what do you got for this week? What do you have for this week?

WASTLER: We revisited, in Japan, there's a little thing called shindugu (ph), which is an appreciation of inventions that maybe you don't really need. All right. Now this one might work. How about a little -- to put butter on your toast. Wouldn't it be nice if it was a stick? Look at this. Now there's a good invention.

SERWER: How have I been living all these years without it?

CAFFERTY: That's a good idea, you know.

WASTLER: You get a runny nose when you got a cold. You keep reaching for the tissue and stuff?

SERWER: Yes, I do!

WASTLER: What if you could just have it on your head, available anytime you need it?

CAFFERTY: There's a name for that person there, but we can't say it on TV.

SERWER: Ding-dong.

CAFFERTY: That ain't it.

WASTLER: Get the eye drops in your eyes, oh, that is hard. Oh that is hard. But if you had one of these gadgets right now, it could really help you get the eye drops in. Plunk, plunk.

CAFFERTY: Where's the eye drops thing?

WASTLER: There we go. See, that makes it work, doesn't it?

CAFFERTY: You have to put the thing in your eye so you can drop the drops in your eye?

WASTLER: That will work.

CAFFERTY: I like the one with the roll of toilet paper on your head. Thank you, Allen.

Coming up next on IN THE MONEY and you do want to stay tuned, it's time to hear from you and read some of your e-mails from the past week. You can send us an e-mail right now if you're so inclined. We're inthemoney@cnn.com. Check it out.

(COMMERCIAL BREAK)

CAFFERTY: All right, it's time now to read your answers to our question of the week about how you won the heart of your significant other. One viewer wrote in the early '70s I simply told my then boyfriend to either marry me or get his shirts out of my closet. We've been happily married for 30 years.

John wrote, I have no illusions as to how I won my wife's heart. She fell for me because I have Washington Redskins season tickets.

SERWER: Yes.

CAFFERTY: I proposed during a game, 1995. We've been happy ever since.

And Evelyn wrote this. I won my husband's heart when I came to bail him out of jail. He had some time there to think about what was important. Now for next week's e-mail question of the week, are the drug companies more concerned with profit than healing? Duh. Send your answers to inthemoney@cnn.com and you should also visit our show page at money.com/inthemoney which is where you'll find the address of our fun site of the week. Thank you for joining us for this edition of IN THE MONEY.

Thanks to CNN correspondent Susan Lisovicz, "Fortune" magazine editor at large Andy Serwer and money.com managing editor Allen Wastler.

Join us next week, if your so inclined, Saturday at 1:00, Sunday at 3:00. Or you can catch Andy and me all week long on "AMERICAN MORNING" which begins at 7:00 Eastern time each weekday morning.

Thanks until next time. Hope to see you soon.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com


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