Jim Cramer Feeling The Heat?
Surprise, surprise. Jim Cramer is in the headlines and under fire again— and it’s not from the real estate industry. TodayShow.com contributor Michael Inbar wrote on Monday:
Bullish investors should turn into shrinking violets as the stock market continues its shocking downward spiral, CNBC’s “Mad Money” host Jim Cramer told Ann Curry on TODAY Monday.
In what Curry called a “dramatic statement,” Cramer emphatically urged any investor who has money they may need in the next five years tied to stocks to pull their dough out.
“I thought about this all weekend,” Cramer told Curry. “I do not want to say these things on TV.”
“Whatever money you may need for the next five years, please take it out of the stock market right now, this week. I do not believe that you should risk those assets in the stock market right now.”
Understandably, a number of people are upset over Cramer’s comments. Especially those who depend on a vibrant stock market for a living. A financial adviser contributed the following on the stock market opinion and analysis website Seeking Alpha earlier today:
Financial advisors across the nation have been trying to clean up the mess that Jim Cramer made. We had clients crying because of the panic he created. Our phones have been ringing off the hook. His market call on the Today Show this week for investors to completely liquidate out of the stock market is the most irrational market commentary I have ever heard. At a time when a seasoned market veteran should be preaching the benefits of diversification and patience to overcome the tough times, this guy sounded more like a rookie — telling everyone to sell out after the S&P 500 had already dropped 30% for the year. Did he ever consider that adherence to such a strategy would collapse the entire investment system as we know it. This call might have been legitimate six months ago, but now?
His irresponsibility has no right being on television. He is doing a disservice to the very people he portends to help – the novice investor. From his platform, he has the opportunity to instill confidence in a system that is better off now than it was a year ago. Just ask Warren Buffett. We now have the $700 billion package to prop up the mortgage security market — just like Cramer said we needed. We have interest rates down to 1.5% — just like Cramer said we needed. On top of that we have the Fed stepping in to buy billions in commercial paper. These structural changes provide a rebuilt foundation upon which our financials can actually reap the benefits of capitalism. Capitalism doesn’t work without a market. Now we have a market. And Cramer decides to bail! Over the ensuing months he must be held accountable for this one.
Hmm. Makes me wonder if the contributor was one of a number of “advisers” who, according to Bloomberg on September 16, were telling their clients in mid-September that the downturn in the stock market was no reason to panic, and should instead be seen as great buying opportunity.
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Regardless, while I don’t have much spare time (especially these days) to watch Cramer and “Mad Money,” I appreciate the show for its entertainment value. Even more so now considering Cramer uttered the following on the July 29 airing of his show:
I am indeed sticking my neck out right here, right now, declaring emphatically that I believe the market will not revisit the panicked lows it hit on July 15. And I think anyone out there who’s waiting for that low to be breached is in for a big disappointment and [they’re] missing a great deal of upside… My bottom call isn’t gutsy. I think it’s just a smart call that all the evidence points toward… Bye, bye bear market. Say hello to the bull and don’t let the door hit you on the way out.
On July 15, the Dow Jones Industrial Average ended the day at 10,962.54. The S&P 500 finished up at 1,214.91.
Today, the Dow Jones Industrial Average finished the week at 8,451.19 and the S&P 500 ended up at 899.22.
Looks to me like the bear never left the building.
Sources:
“Jim Cramer: Time to get out of the stock market”
Michael Inbar
MSNBC, October 6, 2008
“Jim Cramer Should Be Suspended”
Jason Schwarz
SeekingAlpha.com, October 10, 2008
“Wall Street Woes May Offer Opportunity to Buy, Advisers Say”
Jeff Plungis
Bloomberg, September 16, 2008
“Yes, the Market Has Bottomed”
Tom Brennan
CNBC, July 30, 2008
October 11th, 2008 at 12:19 pm
Smirks, lolol I been sayin all along this guy and his half brother that has this chick named Goldie locks in his spare bedroom are nuttin but stock pushers for the “market” uber class. Its about time people get their real mind set for news.
And the greedy market lemmings that are waitin to make a killin on day tradin can sell that bemmer or benz and move out of that million dollar a month NY condo and see what life is like out here in the “slow lane” for a while.
October 12th, 2008 at 11:43 am
Thanks for the comment HOODY. Even the “greedy market lemmings” have forgotten what it’s like to “keep it real.”