Caren Chesler - Resume and Articles

May 2012 issue

Beyond The ‘TV Guy’

Stuart Varney of Fox Business News is a vigorous proponent of free-market capitalism— both as a journalist and a successful investor.

By CAREN CHESLER

Stuart Varney, the former CNN Moneyline anchor who now has his own business show on Fox Business News, spends hours and hours each day forecasting the markets for millions of viewers, but ask him if he’s made any money in them, and he gets quiet. Can I say I’ve made more than $10 million and less than $100 million?” he asks.

When pushed, he narrows it down, to between $10 million and $50 million. He then starts asking questions instead of answering them.

“You’ve done this before. How do you know people are telling you the truth? How do you know they’re not just boasting?”

I try my best to verify the information, but in the end, I don’t know, I tell him.

The truth is, he doesn’t want people to know he’s wealthy because he fears they’ll look at him differently.

“Right now, when I walk to my office, all the people I work with, all the people I know, they look at me as ‘Stuart Varney. He’s a guy on TV.’ And they either like him or they don’t like him,” Varney says. “But if you’re known as a man of money, if they know you have significant wealth—and I’m not hinting that I do—they look at you differently.”

Varney As Investor

Yeah, they look at you like you know what you’re talking about. Apparently, Varney does. The 63-year-old newsman from the English Midlands has amassed a small fortune outside of his broadcasting salary, though he attributes it only partly to investment savvy. The rest was luck, he says.

The luck part comes in when he took a co-anchor job at CNN’s Moneyline and was forced to sell all of his individual stock holdings—he was allowed to hold on to his funds—to avoid a conflict of interest. Varney says he was angry at the time. He didn’t want to sell. The year was 1999. A few months later, the dot.com bubble burst, and Varney was looking back at Gomorrah burning from the back of the bus as it rode off into the sunset.

“I was the guy who sold Lucent above $60 a share, and it subsequently went down to 60 cents. I sold WorldCom in the 60s before it went to nothing,” he says, with just a bit of braggadocio.

But it wasn’t all luck. He put a lot of money into real estate when the market was going up, and he sensed when to pull it out before the market went down. Varney bought single-family homes in Escondido and Rancho Santa Fe, Calif., and Orlando and Naples, Fla., between 1999 and 2002 as real estate prices were rising. But once he began seeing what he calls the “Get Rich Quick” advertisements, telling people they could buy homes with no money down and become millionaires, it was a signal prices had gone up too far, too fast, he says. It was time to get out. He had sold most of his holdings in Florida and California by 2005, a good two years before the market tanked and stripped many people of their wealth.

“I probably left 20% on the table. But I got out intact, and I was selling into a sellers’ market,” he says. “My timing was very fortunate.”

While he sold the lion’s share of his real estate holdings, he still owns a fair amount of property, including a farm in New Zealand that his son operates, several properties in Australia, some houses in Florida and one in California.

He also owns a tree farm in the Catskills of New York state that he bought 10 years ago for less than $1 million that he estimates is now worth $3 million to $4 million. He bought it as a distressed property, but shortly afterward, some local residents knocked on his door asking if they could log his land. He realized there was money in the forest and meadowlands he had bought. Some of the trees were black cherry and red oak, which are used in high-end furniture, while others were hard maple, which is used in flooring for things like basketball courts. He predicts he can earn as much as $100,000 a year selling the timber. He’s about to find out. He’s poised to harvest his first 200 to 300 acres worth and already has the furniture makers lined up to buy it. Revenue-producing farms also carry favorable tax treatment, giving him a break on his property taxes.

Varney is also playing currencies, and he currently likes those that benefit from strong natural resource sales, such as the Australian, New Zealand and Canadian dollars. The Australian dollar, relative to the U.S. dollar, has gone from 90 cents to $1.05 over the last couple of years. The New Zealand dollar has gone from 70 cents to 82 cents. The Canadian dollar has gone from about 95 cents to $1.03. He bets on currencies by buying assets in those countries rather than buying futures—futures are for traders, he says—and his bet is that these currencies will rise relative to the U.S. dollar, given that they’re selling a lot of natural resources to China.

“The only thing that would upset this play is if China goes bust,” he says.

Varney As Anchor

Those who know Varney say his personality on air is much like his personality off: enthusiastic, highly engaging and exceedingly smart. Elisabeth Murphy, who worked as an intern for Fox & Friends, a morning news show on which Varney makes regular appearances, said he was one of the few anchors who would come up with topics himself and do his own legwork to research them.

“A lot of anchors usually just come in and whatever we gave them, they’d read it. He’d be very proactive about giving us stuff he was passionate about talking about,” she says.

That passion is one of his hallmarks. Bill Hemmer, who worked with Varney first at CNN and later at Fox, says Varney’s enthusiasm for the story always comes through on the screen, not an easy feat on a medium as unnatural as television.

“You’re sitting there looking at this black hole, and you’re trying to reach through the screen and communicate to people who are doing god knows what on the other end as they go about their lives. It’s not an easy thing to do, but this guy does it well on every single story,” Hemmer says. “He has an uncanny way of getting you to listen to what he has to say.”

Part of it comes from knowing his topics. Varney’s co-workers say the London School of Economics graduate is incredibly knowledgeable, and very well read. He also has an ability to assess a situation quicker than most, says Steve Doocy, a co-anchor on Fox & Friends.

“I’ll see one tree, while he’ll get the whole sweep of the forest, and the creek down there and a mountain on the ridge,” Doocy says. “He just has a very good eye for the whole picture.”

He sees the creeks because he’s apparently a geography nut. He doesn’t just know states and countries and capitals. He knows every creek, every hill, every briar patch, says Neil Cavuto, senior vice president of Fox Business News and host of Your World With Neil Cavuto.

“It borders on obsessive. But it’s one of the things that intrigues me about him,” Cavuto says.

“He’s a smart guy. He knows history very well. He knows economics very well. And he’s got that dry British wit. I get a kick out of it.”

The British accent doesn’t hurt.

“I’ve always told Stuart he can read the back of a corn flakes box and sound authoritative,” he says.

Butting Heads With Ted Turner

Varney’s accent wasn’t always an asset. He began his journalism career working for a radio station in Hong Kong. When he arrived in America in 1975, he landed in San Francisco and got interviews at the three major news networks, but none would hire him because they said his accent worked against his credibility.

“I got through the door. I got to meet the news directors, and they were all very nice, and they all said the same thing. ‘Sorry. The voice. The accent. Can’t do it,’” Varney says.

The only station that would hire him was KEMO TV, or Channel 20 on the less desirable UHF dial, where he was the sole anchor of a three-hour live “rip-and-read” television show, which, as it sounds, involved him ripping the news right off the Reuters teletype and reading it. And he had to work for free for three months to prove he could do it.

“Not everybody’s willing to work for free for three months and be in the studio at 4:30 in the morning to do cactus television. But I was,” he says. “I was an immigrant. Hungry. Fresh off the boat.”

By 1980, he was hired by CNN, which was then the first channel to provide 24-hour news coverage. He did an early morning news show there until March 1998, when he left to take a break because he says 18 years of doing an early morning show had wreaked havoc on his family and social life. In January 1999, he was asked to co-anchor Moneyline when Lou Dobbs resigned to head an online site about outer space, so Varney went back to CNN.

But two years later, he left CNN again, he says, because he was unhappy that the network and the content of his show were straying from their middle-of-the-road political coverage and slanting to the left.

Varney’s relationship with his boss, Ted Turner, had also soured by that point after they had a dispute during an interview. Varney asked Turner to respond to the fact that his then-wife, Jane Fonda, had announced she’d found Jesus and was becoming a devout Christian. Varney says he can’t remember exactly what Turner said, but he wasn’t pleased.

“I thought that in good conscience, as a good journalist, I have to give my audience what they want, and they want to know, ‘Jane Fonda, devout Christian, married to Ted Turner?’ You gotta ask about it,” Varney says.

Shortly thereafter, Turner publicly characterized Christians as Jesus freaks, a comment that Varney, a devout Christian, found offensive. He resigned over it.

Several months later, Varney joined CNBC’s Wall Street Editorial Board With Stuart Varney, but the show was cancelled in January 2003, and he left. According to Varney, the powers that be at CNBC did not like the politics of the show, which was essentially free-market conservatism.

“We got the impression that the xecutives at CNBC were not keen on that particular political perspective,” Varney says.

He joined Fox shortly thereafter.

THE INTERVIEWS

While he’s interviewed a lot of heavy hitters over the years, the most interesting one he’s ever done—and the only one where he was ever intimidated—was with Margaret Thatcher just after she’d left as U.K. prime minister. She just exuded so much power, he says. He was at CNN at the time, and there was a large room full of dignitaries—finance ministers, foreign ministers, prime ministers, sheiks—and he was interviewing Thatcher in a small room off to the side. When she walked through that large room, there was a hush because everyone knew Margaret Thatcher had just walked in, he says.

“She was completely different from any other politician. She answered your questions directly. She answered the questions you asked,” he says. “I am an unabashed admirer of hers, not necessarily from a political point of view but just from what she accomplished.”

He also interviewed George W. Bush in the Oval Office and found the former president to be very personable and easy to talk to. He says Bush himself opened up the big wide doors of the Oval Office, looked Varney right in the eye and said in a jovial manner, “Stu,” as if he’d known him all his life.

“It was really rather endearing, coming from the president of the United States in the Oval Office, I thought,” Varney says.

The next time he saw Bush, the president asked him if he was legally allowed to be in this country. Varney said he told him he was, to which Bush asked to see his green card. Varney happened to have it with him and pulled it out.

“There were occasions in [Bush’s] public speeches when he did not come across as an eloquent, flowing speaker, but in private, in an interview situation, one on one, he’s completely different,” Varney says. “He’s personable, direct, sharp-edged, funny and altogether engaging.”

His interview with actor-turned-environmental-activist Ed Begley Jr. was not as amicable. Varney says he’s not against saving the environment, but Begley’s responses were extreme, and the former actor went after him, so Varney hit him right back.

“If you can avoid talking on top of someone with whom you disagree, and with whom you’re having a kind of fight, if you can avoid talking over them and shouting them down, if it’s rapid fire, point, point, counterpoint, it can make for good TV,” Varney says.

Varney’s colleagues say his strong suit is actually the fact that he has a strong political point of view, and yet he can interview people of all political persuasions with a civility that isn’t always the case with partisan newscasters.

“Some newscasters border on being insulting or demeaning, practically telling their guests to ‘Shut up!’ or saying, ‘I don’t want to talk to you anymore,’” Cavuto says. “I think all sides could be well served if they passionately adhered to their views but never got passionately nasty about them. Stuart is an example of believing in what you do without being a total ass.”

He certainly doesn’t hide his personal political beliefs. In a 2010 interview with Caroline Heldman, an associate professor of politics at Occidental College in Los Angeles, he spent six minutes disagreeing with her support of Obama’s stimulus spending and the Democrats’ tax policies, and in the end wound up asking her if she was a socialist:

“I always like to ask academics, who are on the left, this moral question: This is not an economics question. This is a moral question. Do you think it’s moral to take more than half the income of successful people, anybody who’s successful, do you think it’s moral to take more than half their income in federal and state income taxes? Because that’s what we’re doing at the moment in America, and it’s going to get worse,” he said.

“I wish that were the case. That is the standard line—” she said.

“That is the case,” Varney said.

“No, there are tax loopholes. Wealthy individuals—“

“No, there are not. Believe me, madam, I know all about tax loopholes, and you, madam, are wrong,” he said. “Every extra dollar you make. Just pick a number, say $350,000 a year. Every extra dollar you make above that, you lose 50 cents. It goes to the government, in federal and state income taxes. That is a fact,” Varney said.

“I wish that that happened. I wish there weren’t tax loopholes that enabled wealthy individuals—”

“It does happen,” Varney said.

“…to get around that—”

“It does happen.”

“My family uses those loopholes—”

“It does happen.”

“I know for a fact that wealthy individuals are not paying 50%. But I wish that they were. Because morally, you asked me a moral question, I do believe that people who can afford to pay more should be paying more in taxes, in order to help those who are impoverished and cannot—”

“More than half?” Varney said, astonished. “So somebody who goes out there and works hard, gets up at 4 o’clock in the morning, works all the way through the day, takes personal responsibility, works hard, lives the American dream, you think it’s perfectly moral for a government to come along and take half of it, and say, ‘I will spend it better than you. You don’t deserve it.’ That is American morality in the year 2010?” No, not spend it better than you. Very clearly, it’s a redistribution of wealth—”

“I don’t deserve to hold on to more … just half of it? I don’t deserve to hold onto half?”

Varney could easily have been talking about himself. Indeed, he does get up a little before 4 o’clock, works all through the day and is living the American dream.

Despite his strong political beliefs, he insists they don’t interfere with his interpretation and delivery of the news. In fact, he gets downright testy if you call him a conservative newscaster.

“When I’m reporting the news, I tell it dead straight. If I express an opinion of any kind, I label it opinion. I think that’s very important actually,” Varney says. “I’m not a pundit. If I ever take on the role of a pundit, I say so very clearly.”

So how does someone who grew up in a working class family, who joined the British equivalent of the U.S. Peace Corps fresh out of college to teach in a home for destitute black boys in Nairobi, Kenya, who spent eight months traveling around India and eventually lived and worked in San Francisco, turn into one of television’s most visible conservatives?

Varney says it happened, in fact, after spending all that time in India and then living in Hong Kong—what he calls the cradle of free market capitalism.

“India, back in those days—we’re talking early 1970s—was an absolute bureaucratic socialist nightmare. Exotic and fascinating, but it didn’t work. You couldn’t get anything done,” Varney says.

And then he arrived in Hong Kong, which was totally free of government intervention, he says, and his eyes opened wide because everything seemed to work. It was dynamic, and attractive, and becoming prosperous. It felt like a place where you could do what you want and be what you want, he says.

“There was a vigor. There was a freedom in the air that was just intoxicating,” he says. “And I found exactly the same thing when I came to America. Intoxicating individual liberty and freedom. Capitalism. Make of yourself what you can.”

And he has.