"What’s important when you’re in that hedge fund mode is to not do anything remotely truthful. Because the truth is so against your view, that it’s important to create a new truth to develop a fiction."

you are viewing a single comment's thread
view the rest of the comments

[–] jersan@lemmy.whynotdrs.org 7 points 1 year ago

Task: So you’re talking about the mechanics of the market –

Cramer: You know that’s actually much more important than fundamentals.

Task: Okay, well, but in terms of the fundamentals even writing about how you’re –

Cramer: Who cares about the fundamentals – Research In Motion just blew out the quarter, but look what people can do. I mean that’s a fabulous thing. The great thing about the market is there’s nothing to do with the actual stocks. Now, look, over maybe two weeks from now the buyers will come to their senses and realize that everything that they heard was a lie, but then again Fannie Mae lied about their earnings for six billion dollars, it’s just fiction and fiction and fiction, and I think it’s important for people to recognize that the way that the market really works is to is to have that nexus of hit the brokerage houses with a series of orders that can push it down, then leak it to the press, and then get it on CNBC that’s also very important, and then you have a kind of a vicious cycle down, and it’s a pretty good game, and it can be played, it can pay for percent or two.

Task: Right, and then you get long before Macworld and the expectation that the iPhone is going to be good.

Cramer: Well yeah because you drove it down.

Task: And then you go back, flip to long side.

Cramer: You totally gotta use the other side. And you know, there’s a case where I would say the January 80 puts can be justified because after I’ve knocked the stock down to 80 I can buy a lot of common, and then you play it right in to Macworld where they’ll probably introduce the phone, and Verizon’s going to take it.

Task: Okay, well maybe the fundamentals don’t matter but let’s talk about the fact that –

Cramer: What Wall Street Confidential is, is not giving you the party line, oh here’s the party line by the way, I spoke to Apple on the phone, I hear the phones are good and Verizon might take it, and as a matter of fact the Research In Motion sellers they, I don’t think they know what they’re talking about.

Task: But you’ve been writing about the cell market, the cell phone market you don’t want to be involved –

Cramer: The problem with the cell phone market, frankly, is that these guys are all killing each other, you know, someone has to take a dive. Motorola and Nokia have to get in a room and just fix price. They’ve been reluctant to do that because of the various justice departments and because they actually –

Task: And it’s illegal, right.

Cramer: Well that hasn’t stopped a lot of other companies. This seems to be a case where they seem to be directly worried about the authorities. It’s almost as if they have a lawyer that matters unlike say the Bristol Meyers lawyers, and you know what eventually happens is the shareholders demand that you get phony lawyers and you sit in the room and it’ll happen soon.

Task: Real quick, the Fed, the numbers out today weaker than expected –

Cramer: Oh so what, the Fed has obviously got to cut, but again, you call the various guys who cover the bonds and you say ignore the bond action, what’s really happening is the Fed is very frightened about, and then you gin up the number that they’re really frightened about. The Fed is actually desperate to try to figure out, you know how quickly they have to cut, without looking like dopes that they raised.

Task: Because they’ve been talking about, they’re worried about inflation all this –

Cramer: You don’t want to raise in May and then cut in January, you’ll look like Mexico for heaven’s sake, I mean this is like a distinguished group of people who went to really good schools.

Task: Right, these are smart guys –

Cramer: Yeah they don’t want to look like dopes.

Task: But when we were talking earlier in the week, you said you think it would be some sort of crisis, possibly Ford being a trigger –

Cramer: Well, you know, Ford went and did all that, you know they pledged all this investment banking to all these guys, so now that they’re very reluctant to say negative things it makes it much tougher for the Ford story to play out. I mean the amount of business that Ford has to do – Ford may be the big client of 2007. So if I were in the corporate finance room, I would say listen to the research guy, I’d say listen, you know, I spoke with Mulely, I actually have the inside, the plan works, so then you go to the research guy and say, oh man what do I do, it’s bonus time, I’m not going to be a total idiot, Spitzer’s going to Albany, let’s get back in the game. I think that’s important.

Task: Is it possible, because a year ago at this time a lot of people were saying GM’s about to go bankrupt and of course the stock is up 50 some odd percent, could Ford be that stock?

Cramer: Well they’re GM. You know, the difference between Ford and GM was that GM’s balance sheet was never really, it turned out it wasn’t that bad. Ford’s balance sheet is pathetic, and you know that because they’re willing to screw over the common for the bond, so that’s kind of, if it weren’t Ford, if this were Qualcomm we’d be saying Qualcomm’s desperate, you know, but, you know, it’s Ford.

Task: But it’s Ford, it’s an American icon and so, right –

Cramer: – you know I drove a Ford, I owned a ford once.

Task: And this is our country. Well this has been Jim Cramer –

Cramer: Again, you know, what I’m trying to go for in the Wall Street Confidential, and I’m not saying you’re sending me – I have to talk about what it’s like at my hedge fund, okay, because, and what other hedge funds do, because the difference is is that if this is an intraday show and you need to know, what I know what’s going on – now, we step back, Research In Motion was a real blowout quarter, it was a really good quarter, and I was quite surprised how strong the margins were, it looks like the other guys have really dropped out. It’s a terrific story. Should it be up six? Yeah I think so, but you know look where we are. It’s Friday, you got five more days to make your quarter, can you really risk having RIM up this much? I don’t think you can.

Task: Okay. And they’re not, and if I’m correct you’re off next week?

Cramer: Yes I am.

Task: Okay, and I am as well so we’ll be back in 2007 –

Cramer: I’m hoping that we get, that we finish the year at 1260 because that’s, at 12,460. Because that’s what I said what the beginning of the year was. Now, yesterday we came in and we were 20 points away from what I predicted, you know I want to nail it.

Task: Do you have a forecast for 2007?

Cramer: Yeah, but I’m not, it comes out, it’s over a series of five days so people have to go to realmoney.com

Task: Check it out, realmoney.com and Jim thanks very much for being here. I’m Aaron Task, stay tuned for more of thestreet.com TV.