OK, let's try to timeline this Cramer thing.
March 11th, 1:19 he has this video up titled "Bear is Solvent" on theStreet.com, clearly extolling BSC the stock. I document it in this post, with quotes such as "my sources indicate the Bear is totally solvent" ....."my understanding,very firmly, is that Bear is not in trouble." ........."Bear I understand is not in trouble, i want to make that point vociferously".......... "Now Bear is one of those companies that is selling way below book. Normally when i see that in a brokerage, I want to buy ITM calls".......... "I am like everybody else, so gun shy at this point, .....that i know that i would buy a small position in Bear options. it's too low, it fell too fast"......... "Everyone has to recognize you can rumor stocks down, but it's harder to rumor them down when you're -8 on the oscilator"
March 11th, 6:30ish PM On Mad Money, he answers the email heard around the world and discounts any notion of Bear having liquidity problems. There is some dispute whether he is saying the stock is safe, or is just saying money held in accounts at Bear is safe. (Added 3/23...Whoever runs theStreet.com database of Mad Money calls believes it is a bullish call in BSC as it is apparently entered as such, as noted and explained in this post).
March 14th 9 AM: Fed and JPM announce Bear bailout.
March 14th 12:39 PM On Street TV, he (correctly) points out that to speculate on a Bear takeover, you should play it with Bear debt. He incorrectly says that BSC stock will probably be taken out unch. and JPM stock is not a buy.
March 14th, 2:40 PM He reiterates much of the above on Stop Trading, but does note Bear's stock "could" be worthless in a deal. Keep in mind at that point, BSC was already down 50% from the open and this interpretation was getting popular. TradelikeMike had this to say over an hour earlier " I’m looking at the stock trading around $35 and I think it might be a short sale here. Even with a bailout, what’s the company worth? Almost nothing! "
March 16th 8 PM "Ex-Squeeze me"? Yes, BSC has been bought out for $2/share? That has to be a misprint. Um....no. (Added 3/23.....Some time between now and the morning, theStreet.com's database of Mad Money picks no longer includes the 3/11 call as bullish, as detailed in this post).
March 17th, 10 AM The video of Cramer's horrible BSC call from 3/11 goes viral. My first glance at the vid. is thanks to a comment here by Puck. It shows up on Drudge, meaning approximately 3 billions viewers have now seen it.
March 17th, 2:40 PM Victory is declared. Yes, CNBC has this headline on their Stop Trading recap, " Cramer Was Right About Bear Stearns". He is "cross-examined" by Erin Burnett with much the same rigor of an infomercial and it is determined (by Cramer) that last Tuesday, Cramer was refering to money held at Bear, not stock itself. So he called it to a tee in Bizarro World: Bear was taken over and money deposited there is still safe.
March 17th, 11PM Daily Show runs his call from March 11th, you know the one where the entire world outside the CNBC bubble is pretty convinced he was plugging the stock pretty hard while it was still trading $62. Another billion or so will see this clip.
A commenter here, Bryce, sums it up pretty well. "As straightforward as he customarily is on TV, if he really meant money held at BSC, in whatever capacity, he would have stressed that he meant that over common stock. He *HAS* to be clear about that distinction, since most of his audience is listening in for stock tips... the fact that he didn't draw that line suggests to me that he meant common stock to begin with."
And I would add that's even if you give Cramer benefit of the doubt on the above, in holds no water, He very clearly makes a bullish case for BSC, the stock, on the Street video at the top of the timeline.
And I would also add that if you are bit distrustful of Big Media to begin with, CNBC puts another huge brick in the wall with that "Cramer is Right" piece. The percent of people who get their information solely from TV and/or a newspaper dwindles by the second; you really can't create your own truth any more and expect to maintain any sort of credibility.
.......also adding that the defense that he was talking about money at Bear makes no sense on any level. Bear isn't Schwab, it's professional customers. Non pro's have all sorts of FDIC and SIPC and other alphabet protections.
*Just noting, I added a couple things to the timeline on March 23rd. They are so noted in italics. And yes, I appreciate the irony of going back and amending a post to include reference to the fact that someone at theStreet apparently went back and changed their mind about Cramer's BSC stock opinion.
Tuesday, March 18, 2008
Can You Afford Not To Watch Jim Cramer?
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25 comments:
"March 17th, 2:40 PM Victory is declared."
LOL!!
Couldn't have said it better. CNBC as an entity is almost starting to take on narcissistic personality traits. The make these assertions without ever asking "Hmm, is anyone going to believe what we are saying?" That's just not part of their thought process. They think all they need to do is air it, and boom...it's reality! Cramer reminds me of a blind man in a crowded room who scratches his ass and then sniffs his fingers, but assumes no one saw him because he can't see.
I can't believe I am doing this... defending Cramer? WTF?
I will give him the benefit of the doubt. He made a call that BSC shares were a good play. By Friday, he was wrong, and changed his tune saying that the common was crap and that the way to invest in BSC was to buy the debt. He changed his mind based on new information. We all do that.
Where I do NOT defend Cramer is that this is something that you and I understand--buy the stock, realize you made a mistake, sell the common, buy deep ITM calls and buy the debt. Not a bad idea really. But how many of his viewers understand that? I'll bet you less than 1/10th of 1% know how to create a convert from the options and the debt.
What's even worse is that he TOTALLY ignores the fact that he DID tell people that he was bullish and the he told people to buy the calls.
It's as if that opinion wasn't actually issued to paying subscribers.
Cramer should just admit that he got the Bear thing wrong early in the week, and that by mid-day Friday, he realized the error based on new information, so he switched to an alternative idea. The worst thing in the world he could do is do nothing and then say he was 100% right.
Um, not sure I want to ponder your analogy at the end, lol.
ESPN has similar things going on, sort of attempts to create their own realities. Big diff though, their base audience tends to be young-ish and overwhelmingly reads the Deadspins of the world and doesn't buy much of it any more. CNBC still can get away with it on some level.
anon: agreed. Honestly, that's the bigger issue here, how to handle a bad call. He is indeed entitled to change his mind as facts change. It is more HOW he and CNBC chose to handle it that is the issue.
The RIGHT thing to do is to admit he liked it on tuesday, but in the form of calls, re-evaluated on Friday as the ground changed, and ultimately saw it going to zero. And he could even claim that was why he played it with calls.
And he could even (selectively) produce a winning trade out of it. Calls he owned went down less than the stock, even after Friday, although you have to stretch to say he ever suggested shorting BSC (he didn't).
It will be interesting to see if the Jon Stewart plus the You Tube type attention this is getting effectively blows out the ACL of Cramer's knee in terms of his ratings.
The "debate" as to whether or not he was talking about the stock or talking about having an account there is like debating a knee injury as a result of a "cheap shot" or a "clean shot." The knee really doesn't give a f#ck.
Re: CNBC's "personality" - yeah. It is starting to go down like cod liver oil. There is an indie flick called "Election" with Reese Witherspoon and Matthew Broderick. If you haven't seen it, rent it.
Most of the CNBC personalities are like Witherspoon's character, "Tracy Flick." Even the men. For the most part, I would exclude Faber and Burnett. For the most part.
I've seem Election, great movie.
You have it pegged, it's irrelevent at this point what he actually meant, the world is laughing at the call. His "knee" is hurting either way.
For some real humor - dig up Cramer's mid day comment on Oct. 8, 1998; at the exact moment of that important market bottom. It's full of foaming at the mouth, end-of-the-world, looking-into-the-abyss language. Great stuff.
I want to make Cramers call "No no no. Bear Sterns is fine" into my ringtone.
maybe that's his future, the ringtone market, lmao.
He is indeed his most apocolyptic at the turns.
Great timeline, it's like looking at one from the Kennedy Assasination, glad I could help! Great work on the Street vid, I think that really cinches it. As for the Erin, "interview," it was such an obvious attempt to pretend she was confused and sound clueless, to let him spit out his contrived message, it was laughable. That's the downside to being coherrent and informed most of the time Erin, we saw right thru it for what it was. Next time let Maria or Becky pretend to act dumb, they don't have to act.
This blog has inspired me to take the entrepreneurial plunge. I just registered the web site www.cramerscalls.com. I'll be putting up free mp3 snipets of his most outrageously wrong calls so that people can download those ring tones. Maybe even that Santelli smack down.
Anybody got that link to the October 1998 rant?
By the way, have you noticed that the ratings growth at CNBC is in shows where people tout stocks. It's not in the market coverage or news. It's fast money and cramer. The news anchors like Erin and Maria HAVE to show those guys some respect, no matter how bad their calls are, because they'll get canned if they do anything else.
I wonder if Santelli will ever let Cramer have it again?
Cramer f**ked up on the BSC call. everyone (who isn't an idiot) knows their money is secure up to the FDIC & SIPC limit. that was a lame lie that anyone should know that!
Jimmy
I saw the video, and NO where was "stock" mentioned. He was talking about money being held at Bear Stearns. I don't understand why people pick on him for things that he did NOT do wrong, because there are so many other bad picks that he has made. He was wrong in thinking that BSC would get bought out at a much higher price, but I don't think many people saw this coming.
pcuk: thanks, and yes, that was a complete farce. Maria sure, her whole career is that sort of "tough" interview. Becky knows better I would think (hope).
anon1: Sounds great, lmao, sign me up.
anon2: yup. zactly.
Sia: Well, if it was JUST the video in some sort of vacuum, maybe. But it's in the context of a TV show built around his insta-stock picking AND he was bullish on BSC stock as the StreetTV video shows. AND it's not a realistic question the way he read it; the investor with money AT Bear Stearns is protected, unless he's a hedgie or hedgie size, which is not the audience he is addressing with MAd Money.
But I agree with you, it's ironic with all the stuff he pulls to get *nailed* on something that may not actually be what it seems.
But then I would caveat that by saying EVEN IF you are right and he's just talking about money AT Bear, his and CNBC's defense of it is utterly dishonest.
Excellent timeline - and I agree 100% that it's all about how he HANDLES the bad calls. While on TV he admits from time to time that he makes bad calls, I can't recall the last time he *OWNED* his mistake. Granted, he's got a reputation to protect but come on, show some integrity (CNBC, you too) and cut your losses before you wind up being perceived a laughing stock by even your "average joe" audience.
Great post, and thanks for the quote!
He got it wrong until he got it right. That's the important thing.
He's clearly saying your money AT Bear Stearns is safe, because at the end he says the worst that happens is they get bought out.
It's possible his sources were insiders at the company since even the CEO was saying they were solvent at that point.
Last night:
"The implosion of Bear Stearns over the past week wasn’t just a run on one bank, Cramer said during Monday’s Mad Money, it could be the beginning of a run on all the banks, including the brokerages."
"In a market where an $80 stock drops to $2 virtually overnight, the financial sector’s numbers just can’t be trusted. These stocks must be sold", Cramer said...
http://www.cnbc.com/id/23681280
Today when the market is up 300+
"A lot of things are working right today... I want to point out that the Lehman and Goldman calls were perfect... If you were short, you just had to say "look" very very tough to stay short... Citi and UBS are dice rolls... I'd rather buy Wells Fargo... Buy in the money calls on Citi and Merrill..."
http://www.cnbc.com/id/15840232?video=687941986&play=1
Can't wait till I can put these clips together and post them.
Bryce: Thanks and Thanks
MD: Indeed he did. Until he didn't
mathlete: yeah, but that's not really the point, he isn't so clear as you suggest AND he liked the stock 3 hours earlier so there's no real reason to give him any benefit of doubt. AND it's a segment and a show where people ask him names and he opines on them, THE STOCKS.
anon: I see he really learned his lessons well, I have to check those out, thanks.
Is this a record? 20 Comments so far (now 21) I think that's the most I've seen on here and it had nothing to do with Melissa Theuriau!!
Considering all the spewing Cramer does, it's amazing he doesn't get into this king of mess more often. Guess he's lucky,
I was walking in Manhattan near the crane accident, when Bloomberg reported the $2 handle. The announcer stumbled a bit and asked to no one in particular if they dropped a zero from the press release.
I imagine everyone but the insiders who knew how 'bad' it was asked the same thing. Can't imagine what employees must have felt.
A gentle reminder from the Twilight Zone, it's not money until its stuffed in your mattress.
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Cramer is the mirror image of Barry Ritholtz , two blowhards whose only commonality is their huge egos and need for attention
both are hugely wrong until the passage of time proves them right ----the stopped clock analogy
they're like Devito and Schwarzenegger of Twins
more like Laurel and Hardy
yeah, this is one of the longer comment threads here. Anecdotal observation is that Cramer, Lenny and Melissa generate the most comments. Mention volatility or an option and I hear crickets chirping.
I know Barry generates lots of opinions. I don't necessarily agree with alot of his stuff, but I don't really have a prob. with it.
Cramer has a huge ability to get out of these messes. This one may be rougher in that people who vaguelly are familiar with him have now seen him make what appeared to be a horrendous call.
I hope he keeps plugging, I'd lose too much material, lol, Lenny only surfaces every so often.
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