To fully appreciate the Jim Cramer angle a little journey to his past is in order. This is from Cramer himself: "We had it down to a science in 1992: my wife would pick stocks that technically looked ready to go up, or she would keep track of merchandise to see what was down to tag ends. She would then generate a list of stocks that could move quickly on good news. Jeff would then go to work calling the companies to try to find anything good we could say about them. I would call the analysts to see I they were hearing anything. When we found a stock that looked ready technically to break out, or where the supply had been mopped up, and Jeff found something positive at the company, and I knew the analyst community didn't know anything positive, we would load up with call options and common stock and then give the good news to our favorite analysts who liked the stock so they could go do their promotion. That would get the buzz going and we would then be able to liquidate the position into the buzz for a handsome profit." (Confessions of a Street Addict, page 61). This is Cramer's big secret. He figured out early that the way to make money betting on stocks was to rig the game - control the news and you control a stock's value. Now he has his own TV show. Nicholas Maier worked for Cramer until 1998. He quit and wrote a book about it called, Trading with the Enemy: Seduction and Betrayal on Jim Cramer's Wall Street (New York: HarperCollins, 2002). Here's an excerpt showing that Cramer was into naked short selling early on: Jim turns toward his head trader. "Mark, sell ten thousand Bristol Myers." "We never bought any Bristol Myers," Mark replies. "We own the calls," Jim corrects Mark impatiently, aggravated by the delay. "So sell it short?" Mark asks for clarification. Mark knows that according to the SEC rule book, selling stock you don't already own (even if you do own the call options) must be marked and executed as a short sale. "You are confusing me with someone who gives a shit. Just sell it! I said hit the f*cking bid!" adds Jim, not interested in wasting time over petty semantics. Skirting the "plus tick" rule in this case won't necessarily make us a lot of extra money, but in Jim's eyes, the rule is still an unenforceable annoyance. "And don't ever ask me that again!" (Trading With the Enemy, pages 70-71). The story of Jim Cramer cannot be fully presented here. But here's an excerpt from Mitchell's book length exposé that will get you into the ballpark: http://www.opednews.com/articles/1/Jim-Cramer-Uses-CNBC-to-Ma-by-the-web-090306-905.html March 6, 2009 at 20:27:18 Jim Cramer Uses CNBC to Manipulate Stocks By now, everyone should have heard about the ongoing war that CNBC is waging against the Obama administration and its plans revamp the economy. From its constant anti-Obama propaganda and commentary to its shady PR stunt to manufacture a bogus uprising against Obama's mortgage plan, CNBC has been working overtime as a propaganda front against the Obama agenda. And now, Jon Stewart has joined in for some good fun. But you haven't seen real fun until you've immersed yourself into the story of Deep Capture. This rabbit hole involves the thugs surrounding Jim Cramer and some of the top financial "journalists" from the New York Times, WSJ, Fortune magazine and BusinessWeek, top hedge funds, the Mafia, and the DTCC. It also includes "blackmail, smear campaigns, espionage, fraud, harassment, extortion, bribery, rumor-mongering, sabotage, off-shore money laundering, political cronyism, frivolous lawsuits, witness tampering, biased financial research, false identities, bogus credit ratings, bribery, libelous blogs, bad science, forgery, wiretapping, counterfeiting, collusion, lying, cheating, threats and theft." And if that wasn't fun enough, it may be the underlying story of what collapsed the entire, global banking system or at least served as the catalyst for the collapse. Unfortunately, this story is so rich and multi-dimensional that I cannot possibly hope to do it justice here. So I will primarily focus on the financial media angle and, specifically, Jim Cramer and his thug cronies. The story begins when a very highly respected journalist and business editor for the Columbia Journalism Review, Mark Mitchell, decides to look into allegations made by the CEO of Overstock.com, that some top hedge fund managers, in cahoots with a circle of financial analyst and reporters, had conspired to make a lot of money by betting short on companies and then systematically destroying those companies by spreading false negative information about them and employing other tactics such as flooding the market with "phantom shares" to drive down a stock's value. To understand this you have to understand how short selling works. A short seller will borrow stock (say at $10) and then sell it immediately and pocket the money ($10). Then, when the company's stock value plummets ($1), they buy it at its deflated value and pocket the difference ($9). This is perfectly legal. But there's another variety that takes place because of a flaw in the system. This is where a short seller sells stock that they haven't actually borrowed yet. There are loopholes that allow shorters to do this legally, but those loopholes have allowed the practice to be abused - which is illegal. Therefore, it is quite easy to fraudulently put on the open market shares of stock that do not, nor ever will, exist. These phantom shares do nothing but crash the value of a stock and therefore make legitimate short transactions highly profitable. This is what Overstock CEO Patrick Byrne had discovered had been done to his company. Naked short selling combined with bogus financial analysis, lies and rumors propagated by CNBC reporters all served to trash his company's stock. So he decided to fight back. He gave a big conference call presentation to a bunch of corporate CEOs and broke the story. That's when Mark Mitchell comes in.
I have read Confessions and Maierâs book. I thought Confessions was a great read, especially about the time in 1998 when his hedge fund almost blew up. He made no attempt to hide his manipulation of people for gain. He seemed to almost boast about it. He also made no attempt to cover up his temper. As for Maier, that is probably the second funniest book Iâve ever read after Pit Bull by Marty Shwartz. He tells one story in there where Cramer told him to go to a shareholder meeting of a grocery store chain. He told him to ask the ceo just one question. He stood up and asked the ceo when he thought they would have to revise their earnings estimates downward to take into account the recent acquisition. The ceo fumbled a bit and as if to cover something up, and said he couldnât comment on earnings. Maier didnât think much about until he got back to the office and found out Cramer shorted the stock. It turns out there was nothing wrong with the earnings, but ceoâs canât comment on earnings publicly, so it looked like he was hiding something.
This is simply a rehash of Deepcapture.com. Interesting to note, the left was totally absent all this time. I would have thought they would have helped us, but I guess they were too busy being bitchy. If you want to see people that hate everything to do with America, read some of the comments............. "I was in the gym, toning my ass. All those goddamned tvs were tuned to Fox or CNBC. I had them change one to CNN." Bitchin' Bruce. Bitchin'. You go Boy.