Jim Cramer: GM "joins the List of Unthinkables"
From unsinkable to unthinkable. But there it is; stock picking guru Jim Cramer says GM is headed for Chapter 11. Yes, The General "joins the list of unthinkables, the ones that may not be able to make it with its current structure. The ones that basically need to be Chapter 11'd to save the business from dying." In his own inimitable style, Cramer reduces the arguments against GM's survival down to its essentials. "GM does not have enough cars in demand that it can make a profit on, and it has way too many cars and trucks that aren't in demand to do anything but lose billions of dollars, despite the decline in headcount and costs per car. It feels like the Citigroup of the autos. Without the deposit base." But seriously folks, Cramer's rant also fingers Ford for extinction. Of course, this is the same Jim Cramer who said the following in his 10-25-06 TV show: "GM – We recommended it at $18; it goes to $36. We say take a little schnitzel. It's now pulled back to $34. It's going to get to $40, but it's going to meander. I like F. I like GM." And this in February of this year: "I know there's risk to GM. But if you want to tell me that I am being reckless recommending this small-cap stock with the biggest share in the world, then I might as well just recommend that there's no real way to make money in the market." Never mind. When telegenic mainstream media mavens tell the average Joe to sell his stock and run for the hills, you can bet the big investors are already sunning themselves in the Hamptons.
More by Robert Farago
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After seeing his meltdown, I don't listen to anything that guy says: http://www.youtube.com/watch?v=SWksEJQEYVU I didn't listen to him before, but that was just too much.
I've been reading Cramer for about 10 years, and he does have a track record - making his hundreds of millions before retiring from the hedge fund to the media job. The highlight might having been calling the top in 2000 and being net short the market for most of the next year. And the youtube segment from last August was an accurate call on the housing debacle of the last 10 months which was totally right. That said, I can't find any value in his current TV show. It's a mish mash that places more value on entertainment and histrionics for his target audience (18 to 29 year olds) than useful investment information.
When I saw Jim Cramer being paraded about as an example of an investment guru, I was afraid TTACs had just jumped the shark. Thank God I was wrong. Excuse me while I click on some advertisements, you all deserve a raise. Incidentally, why praise Craimer over the Housing bubble when freaking Philip Kaplan was predicting that on F'dcompany since 1999? Everyone knew that it would blow sky high, an asset doesn't appreciate like that without something fundamental changing. What fundamentally changed in America over the past 10 years that would require the population to move closer to large population centers?