March 20, 2008
– Comments (11)
After all, his call on Bear Stearns (top video) wasn't any less wrong than his call on subprime mortgages (video number 2).
Draw your own conclusions.
(Big hat tips to Housingpanic.)
Bah, meant to write, it wasn't any more wrong. Cramer's wrong all day long -- that's the way it's going to be if you try and have an opinion on everything and ever stock. You're going to be wrong half the time. (Although, as measured by CAPS, Cramer manages to be wrong more than half the time.)
WOW as a newbie what I've noticed is Cramer changes his philosophy and what he says to suit the particular market.
If he was a hedge manager that hedge would probably go bankrupt.
If only he had a crystal ball, hmmmm maybe then he might do better.
Yes well, there is "wrong" and then there is "horribly-wrong". Calling a buy on a stock that then drops a few percent is wrong. Calling a buy (or hold) on BSC just prior to a 99% bust is so wrong as to be laughable. Especially given the circumstances.
Every time something like that happens, he loses more and more credibility. Eventually, his show will end because no one will watch.
You know man...I've read his books and I think he's a smart guy who presents a great set of investment principles. It's too bad he's on the Elliot-Spitzer-Do-As-I-Say-And-Not-As-I-Do plan. It may actually catch up to him this time.
I agree, I think he's smart, but he's so busy doing his Jim Cramer act, that the sum total of his advice is garbage. Doesn't matter who you are or how smart you are, if you swing at everything, you will bat close to 50%. (Unless you are a baseball player, of course.)
"if every loan in 2006 that was subprime blew up, $500 billion, if they all blew up, you would still not notice"
"it has no relevance whatsoever"
"there's no impact"
"a gigantic hill out of a molehill"
"everybody has to get through this fear themselves"
"it's really important for journalists to look like they're in the room with the big boys"
"it's a fascination with trying to prove that you know as much as the hedge fund managers"
Booyah! FourthAxis, it's virtually impossible for it to catch up with him. He's already filthy rich, and has put himself in a position where he doesn't have to worry about whether he's right or not. He's brilliant, but not in the financial sense, the smartest move he made was to recognize that he could make more money with less work and risk as an entertainer.
We are all never right all the time, especially what the stock market is concerned. If I look at TrackJimCramer's performance, he is clearly ahead of the crowd. And since he is a public figure, we can make fun of him. Although, this Bear Stearns call will be definitely one of those that will mark him for years to come...
Cramer was right when he said "If anything they're more likely to be taken over." I don't think he meant at $2 a share.
1826 active picks... Wow.
LordZ - I don't know whether you're joking or not, but Cramer was a hedge fund manager, and it did really well in most of the short timeframe of his management. It did not go bankrupt.
Yes, Cramer is pretty average because he tries too hard to prove he's above average. But if you limited him to real money, he would probably shine again (though the BSC thing is pretty bad).
True Cramer was wrong on Bear Stearns. But keep in mind, a LOT of people were wrong. If not, the stock would have already been at $2.
It's not just "dumb" people like Cramer, but very smart people have been wrong on BSC as well as other stocks. Why? Not because they were foolish and over-leveraged (although that is part of the issue. Leverage isn't necessarily bad if you have assets to back it up plus a comfortable cushion). Not because they couldn't foresee that a credit crunch might devalue their assets. It seems that nobody (or at least very few) saw that the market for trading those assets could come to a complete and prolonged halt and thus drive the value of those assets to virtually nil. Thornburg Mortgage for example has very few customers that will default on their loans yet TMA's assets were trading as if 1 in 5 would default. How could management (who spent millions of dollars buying stock late last year and who have guided the company through previous credit crunches) anticipate that scenario?
For many of us, our home is our biggest asset. If nobody was willing to buy a house - any house - then your house would be worth nothing regardless of how nice it is. Here's a more real world analogy... Usually, when you finance a home if you don't put at least 20% down you have to pay a mortgage insurance premium. Often you can stop paying that once your home has 20% equity (either from paying down the mortgage or increased value). Wouldn't it be terrible if your home decreased in value and you had to pay more to keep it (in the form of a higher mortgage insurance premium)?
he is clearly ahead of the crowd
I wouldn't say he's ahead of the crowd. He's below 50% accuracy and his high raw point total is owed to having tons and tons of positive deltas, but the only reason he's got so much more than anyone else is becuse the CAPS honchos have had to sport him many more picks than anyone else in the service.