Jim Cramer Meltdown & Attendant Crystal Method Mashup

I am so gay for this guy. Got to attend a very private talk a gave in Dallas. We chatted a bit and he signed my book.

I am continually astonished that his show continues to [be allowed to] air.

'he gave'

I had to watch him for a few months while I took a Personal Finance class. He's the Nancy Grace of money.

imo

CUT RATES when a crisp Andy Jackson wouldn't get you a chocolate bar in London.

anyway I like him because he know's what's up. If he's having a full-on, live-TV meth rage like this, it means the economy is at a point of crisis (and that his STOK PIX, along with his (but not his) portfolios and funds, are in serious jeopardy).

The only way to keep the market artificially propped up is to cut rates, which at this point would have to be a full 1%, which he knows would be distastrous, inflation-wise, in the LR. But of course that's what he wants. Nevermind that to NOT cut rates is to yank the fucking rug out of the housing market. The US economy is way past the point of no return.

SO my question is, where does Cramer want to be when the shit hits the fan? He's can't live without the spotlight, but you can't have a TV show with a guy screaming at you which stocks/sectors to sell short, or which rare Civil War era gold coins to buy...

I guess he could move to QVC lol

the economy is in bad shape, for sure, but the answer isn't "please papa fed, save my investor buddies!" the answer is a market correction, which is gonna hurt, but not everything that hurts is bad right ok

IOW wanko otm

He needs more hair so's he can pull off the Kevin McCarthy crazed-truth-teller look

haha, love the remix action. finally cramer is put to good use.

the economic analysis here is hilarious

i think that he's shorting the market, and trying to panic the audience into selling.

He really was one of the original bloggers, writing several "posts"/articles per day during the dot-com boom and eventually twitter-like short notes. Really good writer.

keyth feel free to add to that. i realized after i posted that i'm basically just towing to mainstream econopundit line... my own honest opinion is that the strong performance in equities markets is actually justified and sustainable, and that Cramer is more or less OTM. but you can't argue that the fallout from years of seliing ARMs to idiots is gonna hurt.

Things are going to get interesting here in Jersey City if his rant is anything close to true - seems to me like pretty much anyone who bought property here in the last five years did it either with a sub-prime loan or a wall street bonus.

http://www.reuters.com/article/topNews/idUSN0533094420070806?feedType=RSS

on a related note, the bear stearns pres resigned.

I love ritholtz

Cutting rates is not going to shore up jack shit at this point, just give people like Cramer and his friends a little more time to pump and dump their shit on the dim-witted sheep who think they can get "alpha" from a fucking television show

is it the old "didn't get out in time" deal?

housing is over, the extent of the correction is going to be massive, and the eventual fallout (more debt for people who will still be working after the next decade, e.g. not the boomers who are going to be on fixed income and piling on the hospital visits into their 80s) is going to put this country's GDP in the toilet and probably cause rioting besides.

But if you're a little shit like Cramer who made a name for yourself when day-trading nasdaq trash was a practically idiot-proof way to make "mad money" then you don't give a fuck about what happens three quarters down the road, much less five years, the only important thing is to always be a bull because bears are losers!!!! whoo hoo!!!

so when do I get to start low-balling motherfuckers and gets me sum properteez?

http://www.affordablehousinginstitute.org/blogs/us/monopoly_houses.jpg

I'm kinda depressed and yet not-surprised by all the adverts on now telling how "you TOO can make money thru foreclosures!"

the low-balling is happening right now in DC!

(if you ask anybody who's selling)

the only important thing is to always be a bull because bears are losers!!!! whoo hoo!!!

Except for his October 1998 "Get Out Now" call.

well yeah right after his whole company went to shit that year

PEW PEW PEW

CUT RATES when a crisp Andy Jackson wouldn't get you a chocolate bar in London.

In what universe is Fatboy Slim's "Right Here, Right Now" a Crystal Method song?

I want an RSS feed that takes bloomberg and bbc world service stories and gives them Mr. Que lolcat headlines

like I can't really excelsior that post bcz it wouldn't work and nobody would get it but serious roffles

Crystal Method is funnier than FBS

Granted, but STILL.

the 90's were SO long ago...

if, theoretically, wall street crashes and burns (probably not going to happen), I wonder what will happen to the banking-fueled condo market that's gone totally insane in the whole NYC/N NJ region?

Yeah, that's exactly what I was wondering. Well, I'm not really wondering. It will mean goodbye giant bonuses and goodbye wall street jobs. Expensive waterfront condos will make good platforms from which to jump into the river.

So, will this be a great fall for renting an apartment/house/condo or what?

I dunno about rent yet.
I mean people who go bankrupt on their mortgage still have to live somewhere.

Might be a good fall for squatting.

True although if wall street takes a big enough hit that's probably going to send rents down (people have to live somewhere they can afford to pay for). But there are many factors in the NYC area in particular that make it more complex than, say, Florida, so it's hard to predict what will go down.

Your search - "post-apocalyptic subdivision" - did not match any documents.

my decision to go back to school next year is seeming like a better and better idea.

YTD Cramer Total Portfolio Performance: ** +3.17%

lol

Cramer may have sounded like a nut in that clip (I haven't watched it yet), but his write-up of the reasons for the current pain that hedge funds are suffering seems fairly OTM, apart from the usual element of hyperbole:

http://www.thestreet.com/markets/activetraderupdate/10372191.html

yeah it sure fuckin' sucks when people who are supposed to be well-trained and educated in managing gigantic sums of money and understanding market cycles and assigning risk all get lazy and forget to actually pay some fucking attention to the news and lose a shit-ton of cash. better bail 'em out, gov. Just like you did back under Reagan to help out the S&L's.

(although in this case cramer is, to his credit, not advocating massive legislative intervention like savings and loan dereg, just more massive inflation - which would also kill us, unfortunately)

bumming from nytimes, via ritholtz again:
http://bigpicture.typepad.com/comments/images/2007/08/06/06homegraphic550.gif
I can draw you a big red circle on this, and then find way, way too many news stories from the past two years or more going into detail - including law enforcement involvement, etc. - about what I draw that red circle around. Maybe we just pay these guys too much for them to pay attention.

I think Cramer is right that the Fed is not about to step in to protect hedge funds - but the crystal ball gets a little murkier when it comes to the involvement of the big I-banks that loan money to these funds. If the Fed believes that the banks' exposure is sufficient to imperil the "stability of the financial system", then that could prompt them to move. But I don't think they will, because of moral hazard, Greenspan put, etc, etc. More likely they'll see this as a good test case to see if the banks really are doing their job in terms of risk controls. Some hedge funds will go bust, but if the banks remain upright, then the financial system will have passed with flying colors, I think.

well yeah you'd hope at least some of the actuarial guys and SERIOUS money systems they have at banks can at least pick up an issue of the Economist once in a while. we'll see soon enough I suppose.

Sure, lots of people saw this coming. This post (referencing a German bank analysts' report) from February 7 from the FT's Alphaville blog foresaw the basic outlines of the current crisis 6 months in advance - and the first commenter even specifically identified subprime as the likely spark that would set it off:

http://ftalphaville.ft.com/blog/2007/02/07/2365/the-great-unwind-is-coming-warn-dresdner-pair/

that's just it: when so many people could have told you - two years out, nevermind two quarters - that this was in the pipe, and nobody at the relevant hedge funds did anything about it, or tried to find a "hedge" position against it (hey hey!) then they absolutely, positively, deserve to lose their jobs and their customers will have to put up with losing their money. because they didn't DO their job, and didn't buy into a good product, respectively, and that's fucking markets. Nobody deserves a helping hand from anybody here. If the government isn't going to bail out all the poor interest-only-ARM-bankrupted doofuses at the bottom of the pile, they sure as hell have no business bailing out the money managers at the top who fell for essentially the same ruse.

To oversimplify, there are two possibilities: that they are working on extreme micro or macro levels that they resemble the neo-cons who led the march into Iraq, or they're like these guys as far as depending on models that failed. But in this case, the events that are bringing these funds aren't 1-in-100-year events.

er, "are bringing down these funds". All of that was typed quickly, clearly.

I don't think what happened to LTCM was a hundred-year scenario either frankly

Is the entire hedge fund fiasco really that different from the savings and loan debacle a generation ago. The money men are going to get the government to buy out at least a percentage of their fxxkups, as they own so much influence in the US government.

I dunno, they didn't get that treatment with Enron or Worldcom, so we'll see. Likely the SEC will be roundly criticized for not interfering enough and Congress will write some other useless fussy shit like SOX that doesn't actually address any of the problems at hand (mainly, that people can be very dumb, are easily cajoled and just as easily panicked)

Cramer may have sounded like a nut in that clip (I haven't watched it yet), but his write-up of the reasons for the current pain that hedge funds are suffering seems fairly OTM, apart from the usual element of hyperbole:

indeed -- Cramer the Columnist is a different (and more sensible) beast than Cramer the TV Personality.

still, ANYONE who takes investment advice from Jim Cramer deserves to lose every cent they invest on his advice. he's to finances what Ann Coulter is to law.

Wow- I watched that video - he was in full froth mode! I was waiting for the guys in the white suits to come out and take him away.

If the Feds are going to ride to the rescue of these poor suffering fund managers, they may not do it in the form of a rate cut. This from the FT:

...financial shares gained ground on hopes that Fannie Mae and Freddie Mac – the giant government-sponsored mortgage companies – would help stabilise credit markets...

Ofheo, Fannie and Freddie all declined to comment on whether the companies had requested a review of their mortgage portfolio caps. However, regulators were understood to be reviewing the cap imposed on Fannie in 2006 after an investigation found flaws in its accounting, corporate governance and risk management practices.

The rumour that the caps on their holdings could be lifted were fuelled partly by comments made by Mike Perry, chief executive of Indymac, a large home lender, about the willingness of lawmakers, and Fannie and Freddie, to help the lending industry. He quoted Fannie’s chairman as saying that it was "prepared to step up and help the industry".

TJ Marta, fixed-income strategist at RBC Capital Markets, said a lifting of the cap would be "a more precise and effective liquidity injection" than a rate cut by the Fed.

http://www.ft.com/cms/s/450538ac-445e-11dc-90ca-0000779fd2ac.html

The bizarre thing about his rant is that he starts out complaining that the guy from Bear Stearns was causing undue panic and should have remained cool, and then he goes from that to the mother of all chicken little freak outs.

I think the panic is a bit overdone - I'm not convinced that we are going to see a really big meltdown. So far we've barely seen a real correction and now the market appears to be fighting its way back.

My guess is that Cramer was worried that his constant rosy outlook was going to be proven way wrong and it drove him insane.

Mort Zuckerman also sounding a bit Chicken-Little-ish today in the FT:

Mr Zuckerman, who has become a billionaire through his real estate business, said problems in the subprime market were "more serious than I originally thought" and that "nobody knows quite how serious".

I think we're going to see a steady drip of bad news from investors for some time. The scary thing is that a lot of these subprime mortgages have adjustable rates that don't reset for another year or two, with initial "teaser" rates that were set low. So it will take a while to see how borrowers will be able to react to the payment shock, but there are plenty of reasons to think it won't be pretty.

Also, this article casts doubt on the ability of Freddie Mac and Fannie Mae to ride to the rescue.

In his latest New York magazine column, Cramer predicts that the subprime hens are coming home to roost in the NYC real estate and job markets:

Bloody and Bloodier: The subprime-lending crisis is worse than you think, and could crush financial and real-estate markets for years

no, no, it's ok. people who couldn't afford their $900 mortgages now have to pay $1000 rents, big deal, they should be thankful they didn't lose big down payments. mum 'n' dad saved the bedroom for them, and their wives and husbands, and kids, and meth-addicted friends. and the exposure to these defaulted loans is getting passed around so quickly maybe when it stops no-one will be holding the hot potato!

Giraffe versus bear in the Colosseum!

How Jim Cramer spends his time these days:

Next, the agents watched a video made by WME client Jim Cramer of CNBC's Mad Money fame. He fielded a call from a phoner wanting to know "what the trends for 2010 are for a recently merged entertainment company". Cramer replied that the firm "needs to be promoting its best and brightest". With that, about half a dozen photos of WME staff began flashing on the screen, and, one by one, Cramer announced their promotions to agent status.

misread that as "WWE" and was v. stoked

Hahahah

It'd make sense if it were-- http://www.google.com/finance?client=ob&q=NYSE:WWE

Some parts of this thread give me flashbacks of the of the "A big one's comin! SHIT!" vs. "It ain't gonna do shit! I'm stickin' around" vs. "Maybe it won't be so bad, but it looks like it's comin' this way" conversations I heard in the days leading up to Hurricane Katrina.

http://i40.tinypic.com/1085z88.jpg