

Jim Cramer reveals a hedge fund strategy for manipulating Apple stock - ilamont
http://www.thestandard.com/news/2009/03/13/jim-cramer-reveals-fomenting-regarding-apple-stock-daily-show

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jfarmer
For an interesting article on Jim Cramer and how he ran his hedge fund, read
this: <http://www.deepcapture.com/jim-cramer-is-a-complicated-man/>

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owinebarger
That's a really interesting site. In the talk at
<http://www.deepcapturethemovie.com/> he has a graph showing how "naked short-
selling" can be used to create an illusory over-supply of a stock and drive
the actual stock price into oblivion.

I don't know how much of it is true, but it's both (a) a clever trick, and (b)
hopefully completely illegal.

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adatta02
I'm calling bullshit. The whole article sounds like it came out of the NY
Daily Post. There are what maybe 10-15 hedge funds that have enough capital to
make something like this stick?

On the other hand, fake internal memos cause APPL to fly all over the place...

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tvon
I can't speak to the specific claims the linked article makes, but if you
watch the Daily Show interview it's pretty clear that Cramer is at best an
asshat[1].

Specific to the headline, Cramer (in clips shown on the show) talks about how
easy it is to spread Apple rumors leading up to MacWorld because "the people
who write about Apple want that story" and "you can claim that it's credible
(...) because Apple wont' comment" (to deny it).

[1] Name calling, perhaps, but it's short hand for saying "an irresponsible
person who spews nonsense for the sake of viewers, which would generally be
expected except that he is TELLING PEOPLE WHAT TO DO WITH THEIR MONEY, which
makes it abhorrent".

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kirse
_Telling people what to do with their money_

Heaven forbid anyone grow a brain and do their due diligence before shoving
their money into a stock or company! Do you people really take financial
advice from ANYONE and just invest away? Give me a frikkin' break, people are
not the victims here.

First of all, "mad money" is the money you have left over to play with after
making solid investments, so the show hardly counts as a serious investment
show. Secondly, people are not idiotic pawns and are fully capable of weighing
their own investment decisions independent of what Jim Cramer is telling them
to do.

It's completely unfair to blame Cramer and call him an "asshat" when the show
is clearly for entertainment purposes. Anyone naive enough to think it's
dispensing serious financial advice should not be putting their money in the
market in the first place.

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callmeed
FTR, I like Cramer ... but I disagree with your take.

CNBC bills itself as a financial news network and Cramer's show is on 2 or 3
times a day.

Yes, his show is wacky and entertaining–but half of every episode is people
calling in for stock advice. How can you say there's no serious investment
angle to this?

 _> > Heaven forbid anyone grow a brain and do their due diligence before
shoving their money into a stock or company! Do you people really take
financial advice from ANYONE and just invest away?_

For many people, his show _is part of the due diligence process_. And he's not
just anyone–obviously his resume, network, books, and popularity put him in a
position where people trust him. You make it sound like he's a 19 year old in
a basement twittering penny stock tips.

Again, I like Cramer and yes–calling him an "asshat" isn't really
constructive. But I also think he has put himself in a position of
responsibility/accountability.

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aston
Here's the full clip that the Daily Show samples from:
<http://www.youtube.com/watch?v=vfWSRuNm6do>

It's not clear whether Cramer's saying he's _done_ these sorts of thing, or
just _would do,_ but either way, pretty rough.

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Raphael
Who cares? Tons of people make and spread Apple rumors. It's not going to have
a significant effect.

I wrote about a different aspect of the interview if you're interested.
[http://blog.vezquex.com/2009/03/jon-stewart-is-wrong-
about-m...](http://blog.vezquex.com/2009/03/jon-stewart-is-wrong-about-
markets.html)

~~~
tvon
It matters when the person doing it makes a living telling people what to do
with their money.

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anamax
Umm, that's not how Cramer makes a living.

Never confuse the label with the product.

~~~
jfarmer
That's how he _used_ to make his money when he was running his own hedge fund.

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tvon
Well, yeah, but if he hadn't run his own hedge fund he wouldn't have a TV show
about the stock market.

Saying Jim Cramer doesn't make his living telling people what to do with their
money is like saying Julia Child didn't make her living telling people how to
cook. Nobody watches Mad Money for the antics, they watch it for the stock
advice, the antics just keeps them awake.

~~~
anamax
You're confusing why people watch with how he makes his money. And you're
confused about why they actually watch.

The vast majority of folks who watch Cramer don't do more than one or two
trades based on his statements.

Yes, I know about how Cramer's recommendations "move markets". The size of
those moves proves my point. He's got enough of an audience that if a
significant fraction of them did anything, the changes would be enormous.
They're actually on the edge of statistical insignificance.

Julia Child is a great example. People watched to "learn" but nothing much
changed. Yes, they bought some equipment and cookbooks, but she really just
changed how people talked.

