Continuing on our going series of scooping the MSM, today we look at a mostly positive article in Monday’s NYT on Jim Cramer’s Mad Money ,
called Ego
Unleashed, or Everyman of the Market?.
It is a follow up to our Friday pieces, The Thin Green Line and Monitoring
the ‘Mad Money’ Madness. That column was actually well recieved by journalism blogs; Most
media are not that introspective, and do not take very critical looks at
themselves.
The NYT piece is also worth a read. The article
concludes that while the markets may have been going sideways for a while, Cramer’s stock has
risen.
And as several readers have pointed out, since Mad Money started last year, the Street.com’s stock has had a nice rally:
>
click for larger TSCM chart
via Ritholtz Research
>
Source:
Ego Unleashed, or Everyman of the Market?
David Carr
NYT, February 6, 2006
http://www.nytimes.com/2006/02/06/business/media/06carr.html
“Mr. Cramer can be and has been spectacularly wrong.”
I think that might be a slight understatement. You would have lost 99% of your investment if you had actually invested in his “stocks for the new world”.
Uggh.
“You would have lost 99% of your investment if you had actually invested in his “stocks for the new world”.”
Well maybe, if you were an idiot and bought them and then never followed them again, or didn’t bother to sell when he told you to.
The chart sums up nicely exactly what Cramer is doing… working the system to improve his bottom line.
It’s important to remember that while he’s in front of a TV camera, Cramer’s job is to entertain.
I was simply pointing out that it is quite impressive that he actually recommended a portfolio of 10 stocks that would have lost your entire investment. I believe it takes rare talent to be able to find stocks that actually fall 100%. You could be quite a rich person if you could pick such stocks.
In the case of RHEO (which is down 75% from where he recommended it just two weeks ago) he really stepped up his game.
All kidding aside, Cramer is on TV to boost his personal stock, sell his book and boost CNBC’s ratings. Telling his viewers that he cares is almost as humorous as Bill O’Reilly telling his viewers that “the spin stops here”.
Lets not confuse entertainment with education. The two do not mix well.
When Cramer ran his hedge fund, he had a partner/foil. Also, I believe when the &$^# hit the fan, his wife came in and talked him down.
Cramer by himself could be quite dangerous. We’ll see..
Also, TSCM nicely illustrates the WB quote “in the short run the stock market is a voting machine, in the long run it’s a weighing machine”.
I like Cramer I think he brings some much needed excitement to what has been characterized as a stodgy ‘old boys’ club. But the way he goes about it (sqinting my eyes) maybe somebody else did it better (insert flaskback waves here)
Fade in
Scene late 1800′ place earth location New York City
Phineas Taylor Barnum decides to make a name for himself. His craft Salesmanship.
A beggar approaches our hero and asks for a handout.
Instead, Barnum offers him a job at a dollar and a half a day. He handed the puzzled beggar five ordinary bricks. “Now,” said Barnum, “go and lay a brick on the sidewalk at the corner of Broadway and Ann Street; another close by the Museum; a third diagonally across the way… put down the fourth on the sidewalk in front of St. Paul’s Church, opposite; then, with the fifth brick in hand, take up a rapid march from one point to the other, making the circuit, exchanging your brick at every point, and say nothing to anyone.… [A]t the end of every hour by St. Paul’s clock show this ticket at the Museum door; enter, walking solemnly through every hall in the building; pass out, and resume your work.”
The beggar moves off with his five bricks, and begins his idiot’s play. Within half an hour, more than five hundred curious people follow him. In an hour, the crowd doubles. When the brick-toting pied piper entered the Museum, dozens buy tickets to follow him. This continues throughout the day and for several days, and Barnum’s business shows a satisfying increase.
Fade out.
There’s a sucker born every minute.
Every Crowd has a silver lining.
Cramer is just the next in a long line of Humbugs.
BTW this way to the Egress.
I watch Cramer for the entertainment value, but I think his stardom will be relatively short lived. Anytime an individual or newsletter gathers a large enough following there stocks will underperformed. I have seen Cramer recommend low volume stocks and people buy these stocks the next day with market orders upping the price as much as 30% or more in some cases. How dumb can you be?? My guess is that the average person who does no stock research and just blindly follows his advice will lose money. My guess is that if you could short the thinly traded companies he recommends you could probably make money.
The biggest thing that bothers me about Cramer is that they show his performance based on the stock’s price at the day’s closing price. Yet nobody but Cramer or an insider could have purchased it at that price. Please, do not take that statement as I think there is something crooked going on, becasue I do not think that. I am just trying to make the point that the next day’s open is the price people payed for the stock and that is the price that should be used in determining performance. Though I think telling his performance would be difficult because unless he specifically mentions it you do not get his sell recommendations.
Tne good aspect of Cramer is that he has mentioned many companies that I own and then they pop up the next day.
I think we have been in a Bull Market inside a secular bear market and the bull market is ending. We have rising interest rates, rising inflation, and contracting PEs. By the time the Bear Market ends the Cramers of the world will be long gone. In fact when Cramer’s show ends that might be a Buy Signal.