Lemmings, Lemmings, and more Lemmings
August 05, 2009
Lemmings, Lemmings and More Lemmings
Last night, Jim Cramer of Mad Money fame onCNBC, recommended that you buy Bank of America. Here’s the problem I have with all the folks on television who tell you what stocks to buy and sell and when. You have no recourse if they are wrong. Cramer can blow up millions of people (which he has done before) with complete impunity. All CNBC need do is put up the disclaimer that whatever Cramer says is his opinion and not theirs and you can’t go after them.
It matters not whether Cramer is right or wrong about the Bank of America (I kinda wonder where he was when the stock was three bucks instead of sixteen). The point is that he has no relationship with you. He cannot gauge your risk tolerance. He doesn’t know whether or not your job is stable; how many kids you have; how much debt you carry. He knows nothing about you, and yet, people hang on his every word.
Not only does this make you a lemming; it makes Cramer one as well. Let me point out that myself and many, many others have been talking about the financial services industry for six months. My good friend on Fox Business, Tobin Smith two weeks ago on Bulls and Bears said that Bank America doubles in a year. (the stock was 12 at the time). So, Cramer’s recommendation, far from brilliance, is merely coat-tailing.
And, that’s the point. Folks, there has not been an original idea on Wall Street since the buttonwood tree. You would do well to remember that.
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