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 Leave Cramer alone

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Number of posts : 440
Registration date : 2007-07-01

PostSubject: Leave Cramer alone   Sun Aug 19, 2007 8:59 pm

Leave Cramer alone

Posted Aug 19th 2007 12:10PM by Douglas McIntyre
Filed under: Television, Rants and ravesBarron's cover story on Jim Cramer this week is a perfect August cover: beach reading about whether Cramer is a good stock picker.
Cramer and I went to college together and I was a board member at (NASDAQ: TSCM), so I am not unfamiliar with Jim's career.
The Barron's piece starts out by saying the viewer of Cramer's show Mad Money
would only have made 12% on Cramer's picks over the last two years. The
magazine uses a firm called YourMoneyWatch to determine that. It tracks
Cramer's stocks from when he tells viewers to buy them up until he says
that they are "sells." In a chart, Barron's shows Cramer's performance against the two year advances of the Dow at 22% and the S&P at 16%.
Cramer has a wide following. His Mad Money show has 138,000
viewing homes according to Nielsen. Several hundred thousand more
people read him through products at TheStreet. He is written about in
the press several times a month, so Cramer is almost certainly the most
widely followed stock guru in the country.I don't know if the
Cramer stock picks make money or not. He offers thousands of them when
all of his columns, comments and TV recommendations are combined.
Tracking services may not be perfect when they decide what a Cramer
"buy" is. Barron's factors in commissions. But, commissions are part of any transaction, not just ones that come from listening to Mad Money.
The idea of ranking Cramer largely misses his importance as a media
and Wall Street figure. Cramer is about research. He is about
individual investors learning the things that institutions know, and
about thinking like a professional investor. What Cramer brings to
investing is that people with small portfolios can reason their way
around the stock market and do well. But, they have to look hard at the
companies, their managements, the global economy, the Fed, and all of
the other forces that make a market.
I rarely watch Mad Money; t makes my hair hurt. But, from
what I have seen from the show, it is as much about the way winning
investors think as it is about stock picks. And, good advice about how
to think is hard to come by.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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