Jim Cramer, he thinks he’s always right

Posted by Ray on July 18, 2009 under cnbc, Main | Be the First to Comment

Ever wonder why he talks about the very few of his picks that actually go up and not the countless that plummet? I know he has to disclose his positions, finally, but disclosure also makes people buy the stocks he buys, so its still front running in my opinion.

Regardless, he has been so wrong so often that it is hard to keep track. He says the worst is over and JP Morgan says things are getting better. That is partially true, JP Morgan said things are stabilizing which in Cramer world means things are getting better.

I do not doubt that banks have stabilized to some degree, after all the government said no major bank will fail, we guarantee it. However, that does not mean that unemployment will not increase and there are not problems still ahead. Foreclosures are still happening and as consumers stop buying firms will fail which will lead to commercial real estate problems. Not to mention that banks are not lending to people which does mean less delinquencies to come.

Here is the really funny part. In 3Q09 when we do comparable earnings to 3Q08 we will see staggering earnings which will solidify the “things are back to normal” group. Based on a 35% discount to S&P 500 earnings for 2009 I place a fair value on stocks at this level. But if we take the earnings per share versus a 12 P/E ration, which is what a few analysts are suggesting, that puts the S&P much lower than March lows.

I may be wrong, I admit it, but I know that Cramer is not right and the proof will be next week when we have a sell off and he is back to the “we must be careful” boat. Frankly, this guy is an ego maniac and has given shitty advice to say the least. Look at SNDK, SanDisk, when he said the companies board should be fired last fall when they declined a bid from another firm. Now he says the stock is moving higher and BUY, BUY, BUY. I realize the market is fluid and I know how to trade, but this guy is dangerous to investors, period.

Here is his rant about how he is always right and people like me suck.