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Jim is still the Mad Cramer, make no mistake about it



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Dec 17 2007
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There’re not many crazy stock investors or traders around, at least not that FinanceTwitter is aware of. However when you have someone as crazy and mad as Jim Cramer you just got to be both flabbergasted and thrilled. If you’ve been trading for a while in the US stock markets chances are you should know this crazy fella who didn’t give a damn when he got mad or irritated at somebody or something. He’s easily one of the best stock entertainers around and you can’t miss him if you glued yourself to CNBC.

Mad Cramer might be, well, crazy but he did help lots of people in the basic fundamental of stocks investing. He dares to make a call on stocks that he think are fabulous and he won’t think twice about telling his audience to flush stocks down the toilet if he hates them. Yes, he runs radio shows that attracted great number of followers and he’s influence all right judging by how certain stocks jumped the moment he recommended it. While he was proud and enjoyed every moment of his influence, he was responsible enough to advise his fanatic fans not to chase the stocks that were bid-up ridiculously high as a result of it – something known as “Cramer Spike”.

Mad Jim CramerOnce in May 2007 when Google Inc. (Nasdaq: GOOG, stock) was trading below $500, Jim told his viewers to put their money on the seach engine as the stock would be going up to $600, while the rest of the professional investors and analysts told the world to avoid Google. Make no mistake because Jim Cramer was a fund manager before and he knows what he was talking about. What made Jim even crazier was the way he justified Google’s $600 a share value. Due to “contrast” he said Google was the cheapest Internet stocks and the escalation of stock price of Amazon.com Inc (Nasdaq: AMZN, stock) made Google’s stock even cheaper. Using metrics of valuation, Cramer had sales growth of 33% and an operating margin of 4.8% in comparison to Google’s 63% sales growth and a 33% operating margin – Google’s stock was half as cheap as Amazon. So if Google were to get the same valuation as Amazon, Google would be trading at $704.

Jim Cramer, the flamboyant host of CNBC’s Mad Money is seen as the hyperactive stock-picker. But nobody gets past his screening, not even the most powerful man in the global stocks markets – the Feds Chairman Ben Bernanke. His proudest moment of the year (2007) is an on-air tantrum in the middle of the summer’s financial crisis, a plea to the Federal Reserve Chairman Ben Bernanke to take action. “He has no idea how bad it is out there. He has no idea!” he told CNBC’s Erin Burnett. Watch the video below and judge for yourself how mad, or rather brave he was. Try to do that to Malaysian Prime Minister and you could end up in detention without trial under Internal Security Act (ISA).

He wrote some books and the latest book, Jim Cramer’s Stay Mad for Life, is surprisingly “calm” (or boring?) advises readers to pay off credit cards, make the most of 401(k) plans and individual retirement accounts (IRAs), and get the right kinds of insurance. Most Cramer Stay Mad for Lifepeople actually won’t get rich by buying individual stocks, Cramer says. Unless you do your homework, namely spending an hour a week researching for each stock you own, “You won’t beat the market, and you’ll probably lose money,” he writes.

Jim may come to his sense that investing long term is probably the bullet to riches after all, compare to short-term traders. One of his critics (reported in BusinessWeek) said Cramer is a “chair-throwing, self-aggrandizing clown who gives terrible advice”; but at the same time couldn’t help but to admit “he’s obviously a smart man who knows better”. No matter what, he’s still the Mad Cramer in the Mad Money who helped lots of people making money investing stocks. And I believe he’ll continue to be mad for a very long time. You can search other books written by Jim Cramer here.

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