Self-confessed stock manipulator Jim "Mad Man" Cramer was out today desperately trying to convince his beloved home-gamers to stay tough despite the brutal sell-off in commodities and other Cramer favorite stocks (after all Jim and his hedge fund friends need gullible buyers in order to unload their shares). Cramer goes on to tell the sheep that while the decline in his favorite stocks has been severe, it is almost over and you should not be shaken out. He is referring to stocks like Freeport, Conoco, and other momentum commodity plays.
If you are thinking about buying into the commodity/energy decline, you might want to reconsider this considering that Jim Cramer is the ultimate contrarian indicator. No one else better personifies the cartoonish Mr. Market better than Mad Jim. You know it will be time to buy when good old Jim is passed-out drunk on his famous linoleum floor. As long as Cramer is still up-right and sober, his buy, buy, buy stocks remain in sell mode.
Below is a list of Jim Cramer's most famous stock market calls. If you are wondering why someone who claims to have returned 20% after fees during his hedge fund tenure can be so wrong so often, you are not alone. There may be a reason why Mr. Cramer has never shown audited returns for his hedge fund.
Cramer on Imminent Sub-Prime Collapse--Don't worry its meaningless, buy stocks say Jim. July 2007
Before Bear Stearns Failed---Jim tells the home-gamers all is well--even Bear is okay--buy stocks. March 2008
Cramer Flip-Flopping on various stock calls---showing signs of being bi-polar. Aug 2007
Cramer Pumps Lenny Dykstra as a Great Stock Picking Guru--Mr. Dykstra has since been exposed as a fraud and criminal.
Buy, Buy, Buy Florida Real Estate--Jim Cramer tells Regis and Kelly to bet the farm on Florida Real estate--in July 2008--also buy stocks. Best Quote "I want to buy 2 homes."
With a track record like this, it is almost surreal that he still has his highly-rated television show. It just goes to show that there really is a fool born every minute. It reminds me of a story told by the great Jesse Livermore about two guys who get an "inside tip" from a friend who happens to be on the board of directors of a company. The insider tell the two men to buy all they can of ABC stock. They do. The stock plummets. One of the men gets mad and decides to send an angry expletitve laced telegram to the insider, chastising him for misleading them on the stock. The other friend interrupts and says this is not a smart thing to do because if they make the insider mad he won't give them anymore stock tips!
Now that we have gone threw Cramer's questionable stock picking record are you willing to follow him down the rathole? Not me. I would rather listen to someone like Marc Faber who told investors to sell stocks in Nov 2007 and buy them back in March 2009 (Marc Faber's May Outlook: Beware the False Breakout in Stocks).
Black Swan Insights