Whatever you may think about Cramer is secondary. Baruch’s main argument is that being a consistently successful non-professional investor requires enormous effort and is quite challenging. And the odds of finding good advice are far less then guessing the outcome of a coin toss. As an analogy, you need to learn to swim really well before jumping in with the sharks, and then, the even the best swimming skills only go so far. – Ilene
Baruch found himself commenting on Wall Street Cheat Sheet like ten days ago, on a post by Damien Hoffman, who seems to really dislike Jim Cramer. The post was about some investigation of TheStreet.com by the SEC, which Damien thought highly amusing, perhaps because he also runs a competing subscription-based financial edutainment site. Now, Baruch doesn’t pay attention to Jim Cramer on TV, but in fact quite likes him in print. He reads his posts on theStreet.com, and respects his track record as a hedge fund manager and pioneer econo-blogger. So Baruch felt a brief moment of annoyance about seeing someone he liked being unecessarily trashed, but soon his heart was filled with forgiveness and understanding again. We must not be too harsh; snark is Damien’s job, what he gets paid for. He is a financial blogger-journalist, and being cheeky about mainstream media figures is part of that David and Goliath thing blogging used to be all about.
Anyway, this post is only a bit about Jim Cramer and Damien Hoffman. The exchange got Baruch thinking about the differences between journalists/bloggers (or whatever you want to call them) and investors, and what it means to communicate about investments with the public. Baruch finds this terribly interesting, because of course as an amateur econo-blogger and a professional investor, he has a foot in both camps.
Some of Baruch’s best friends are, or have been, financial journalists and commentators, on blogs and print. Baruch in his time also attempted a bit of journalism, before he found his true calling (which isn’t blogging, by the way). Being a financial journalist is a good, interesting job, and very important to the proper functioning of a marketplace. Journalists can do things, find things out, and explain things the public and investors need to know in ways investment professionals can’t, at least without risking jail.
On August 26, 2009, Kass authoritatively proclaimed, “Markets top during times of enthusiasm. I believe that the markets are now overshooting to the upside and that the U.S. stock market has likely peaked for the year.”
Unless this time the greatest "contrarian long-term secular indicator of all time" no longer applies, this bear market is not finished. Although if you’re short, you’re ability to trade it may be. – Ilene
The end of investment fads tend to coincide with sharp changes in investor sentiment and long-term secular moves. No one has represented the excessively bullish & leveraged market of the 80’s, 90’s and 00’s more than Jim Cramer. He worked at the most highly leveraged hedge fund on Wall Street – Goldman Sachs. He took a dotcom firm public and promptly lost 95%+ for his shareholders at the peak of the market in 1999. He ran a super beta tech hedge fund in the leverage driven 80’s & 90’s (which I guarantee you underperformed the Nasdaq 100 on a risk adjusted basis), and he now runs the bullish of all TV bullish shows – “Mad Money”. The show basically begs small investors to be reckless with their hard earned cash. It borders on financial negligence in my opinion, but that’s for another discussion. No one has been a better icon of the excess of the 80’s and 90’s than Cramer himself.
Cramer is a powerful man. The mere mention of a stock can send shares soaring. (If investors are truly upset about the stock manipulation that Goldman Sachs and high frequency traders are accused of they should be extremely alarmed about Cramer’s show – no single person has manipulated more stock prices in the history of the stock market). When this phenomenon began several years ago I was dumbfounded. I asked myself: “who would buy these stocks in the after hours market at such a steep premium?” Late last year the trend had waned. The stocks Cramer recommended didn’t soar. Cramer’s power had declined. After all, he had called the bottom to the bear market on 3 separate occasions (all wrong), had recommended Bear Stearns just weeks before they went under, recommended Wachovia just days before they went under, top ticked the banks in a bet with Eric Bolling in what has to go down as one of the worst market calls of all time and even proclaimed in late September 2008 that “the bounce means the crash can’t happen”. His track record was…
This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible. Feel free to contact me directly at firstname.lastname@example.org with any questions.
Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts. After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.) Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.
Moments ago, in what NBC classified as a "potentially lethal blow to Obamacare" a federal appeals court has ruled that the federal government may not subsidize health insurance plans bought by people in states that decided not to set up their own marketplaces under Obamacare. The law clearly says that states are to set up the exchanges. But 34 states opted not to, and the federal government took over in those states. The court ruled that federal government may not pay subsidies for insuranc...
The Bureau of Labor Statistics released the June CPI data this morning. Year-over-year unadjusted Headline CPI came in at 2.07%, which the BLS rounds to 2.1%, essentially unchanged from 2.13% the previous month. Year-over-year Core CPI (ex Food and Energy) came in at 1.96% (rounded to 2.0%), up from the previous month's 1.83%. Of particular interest is the fact that month-over-month Core CPI (less food and energy) rose only 0.05% (rounded to 1.0). The headline MoM increase was largely driven by higher gasoline prices (which have dropped eight cents per gallon over the last two weeks).
Here is the introduction from the BLS summary, which leads with the seasonally adjusted data monthly data:
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent in June on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reporte...
Despite a highly eventful week in the news, not much has changed from a stock market perspective. No doubt, investors have grown immune to the daily reports of geopolitical turmoil, including Ukraine vs. Russia for control of the eastern regions, Japan’s dispute with China over territorial waters, Sunni vs. Shiite for control of Iraq, Christians being driven out by Islamists, and other religious conflicts in places like Nigeria and Central African Republic. But last Thursday’s news of the Malaysian airliner tragically getting shot down over Ukraine, coupled with Israel’s ground incursion into Gaza, had the makings of a potential Black Swan event, which in my view is the only thing that could derail the relentless bull march higher in stocks.
Nevertheless, when it became clear that the airline...
Reminder: OpTrader is available to chat with Members, comments are found below each post.
This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).
We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options.
Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.
To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here
Dunkin’ Brands Group, Inc. (Ticker: DNKN) put options are active on Friday as shares slip on a downgrade to “Neutral” from “Buy” (with a 12-month target price of $45.00) at Janney Montgomery, and perhaps ahead of the company’s second-quarter earnings report next Thursday. Shares in the name are down 1.2% just before midday to stand at $43.36 and off the lows of the session. The stock has dropped nearly 20% since reaching a 52-week high of $53.05 in March.
The most traded contracts on DNKN today are the Aug 40.0 strike put options, with nearly 5,700 contracts in play against open interest of just 452 contracts. Mos...
We tried holding up stock prices but couldn’t get the job done. Market Shadows’ Virtual Value Portfolio dipped by 2% during the week but still holds on to a market-beating 8.45% gain YTD. There was no escaping the downdraft after a major Portuguese bank failed. Of all the triggers for a large selloff, I’d guess the Portuguese bank failure was pretty far down most people's list of "things to worry about."
All three major indices gave up some ground with the Nasdaq composite taking the hardest hi...
Reminder: Pharmboy is available to chat with Members, comments are found below each post.
Well PSW Subscribers....I am still here, barely. From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.
First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices. Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment. Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer. For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...
I just wanted to be sure you saw this. There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.
If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.
Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.
Note: The material presented in this commentary is provided for
informational purposes only and is based upon information that is
considered to be reliable. However, neither MaddJack Enterprises, LLC
d/b/a PhilStockWorld (PSW) nor its affiliates
warrant its completeness, accuracy or adequacy and it should not be relied upon as such. Neither PSW nor its affiliates are responsible for any errors or omissions or for results obtained from the use of this information. Past performance, including the tracking of virtual trades and portfolios for educational purposes, is not necessarily indicative of future results. Neither Phil, Optrader, or anyone related to PSW is a registered financial adviser and they may hold positions in the stocks mentioned, which may change at any time without notice. Do not buy or sell based on anything that is written here, the risk of loss in trading is great.
This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities or other financial instruments mentioned in this material are not suitable for all investors. Any opinions expressed herein are given in good faith, are subject to change without notice, and are only intended at the moment of their issue as conditions quickly change. The information contained herein does not constitute advice on the tax consequences of making any particular investment decision. This material does not take into account your particular investment objectives, financial situations or needs and is not intended as a recommendation to you of any particular securities, financial instruments or strategies. Before investing, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.