Friday, March 28, 2008

Does Cramer still believe that Bear Stearns is just fine?

Jim Cramer is fine for amusement. I rarely watch him, but as a proud Nittany Lion alumnus caught the recent show at Penn State on CNBC. Pure entertainment and nothing more, anyone who takes investing advice from Cramer will not do very well in the market over the long term. Websites that properly track his picks (meaning not demonstrate that he has always under-performed the market.

Even worse, the recent sequence of shows where Jim recommended Bear Stearns on Tuesday March 11th and then eliminated the buy recommendation from the website after the fact makes it clear that there is no integrity in the investing results from his rants. A video on YouTube outlines the BSC stock pick situation and demonstrates the alteration of the website after the stock crashed.

Patrick Byrne the CEO of (also a controversial figure with a public campaign against naked short selling) recently outlined his thoughts on Jim Cramer. The Jim Cramer is a Complicated Man post provides some excellent detail and thoughts.

The lesson here is that you should not believe the buzz from Wall Street pundits about their overall returns. This includes media clowns, fund managers, and analysts – the results for most of these “super-stars” have been spiced-up by the magical elimination of bad picks. The same holds true for most “get rich with my trading system” scams propagated on the web.