Wednesday, March 19, 2008

More news on Jim Cramer

I have never been a big fan of him (my thought has always been is that he is really smart and a great marketer), but this probably has gone too far. Does anyone really believe he didn't say "sell" last week because he was afraid to cause a run on the bank? Mmm...maybe...better to 'fess' up and admit your mistake. This is not your finest hour.

But anyways, here is his response after Bear had fallen.

By the way, thanks to a few readers who correctly pointed out that whoever is writing at Daily Show must have read Fooled by Randomness (or at least came to the same conclusion on their own). The suggested name for the new show (No Matter how well I do over the next ten years, I still won't make up all the money I lost with Bear) while poorly named from a marketing point of view, is the exact point Taleb's Randomness book begins off with.


Anonymous said...

As delightful as it is to say, "I told you so", he did not say keep your money in the stock. He said it was okay to keep your money with the brokerage. That was correct. It was also 'safe' to keep your money at E-trade when the rumors were swirling around it a while back.

If he would have done what all those with perfect hindsight are suggesting, then they would be castigating him for causing the run on Bear that precipitated the fall of Bear.

Heads he loses. Tails he loses. Both cases the media wins and those that specialize in I told you so, glorify themselves (in their own mind.)

Anonymous said...

Obviously, a lot of things can change in 8 weeks:

Watch for a Takeover Bid for Bear
By Jim Cramer Columnist
1/24/2008 11:13 AM EST

What's been missing here? What else happened in 1990 besides investments from overseas and a Fed that cut rates?


I think they are about to occur. I keep thinking about the changes at Bear Stearns (BSC) , where a great brand name with great investment banking has fallen 90 points from its high. Bear has good stock trading, good prime brokerage and a good fixed income, ex mortgages.

Cramer: Bear Stearns Ripe for Takeover

While Alan Schwartz is a good man who can do a decent job at Bear, I have to tell you that I think that this company is too valuable to others to be independent. Just too valuable.

In short, I think it will be taken over. I have to believe that UBS (UBS) , which needs to shore up investment banking; Deutsche Bank (DB) , which wants to own prime brokerage; or Credit Suisse (CS) , which needs better stock trading; could all be expected to bid for this company.

I also think the fact that Jimmy Cayne, the chairman, needs to reward shareholders who have stuck with him, and get something big out of this company.

Bear has scrubbed the books; I don't believe there are any hidden skeletons. It makes for a nifty $15 billion acquisition -- it is currently at $12 billion, half of what it was!

Most important, this stock acts too well for me to think that it's not going away.

Yes, I am predicting it: Bear will be bought, and it will be bought at a hefty premium as part of the needed consolidation during this period.

I would buy it. And I would buy calls on it out a month.

I think you will make great money.

At the time of publication, Cramer had no positions in the stocks mentioned.