Something of a scandal has erupted over remarks made by Mad Money host Jim Cramer in the above video from TheStreet.com explaining how traders attempt to play the market price of stocks they take short positions in. One way of doing this–which Cramer describes as widespread although perhaps illegal–is for a hedge fund trader to call reports and analysts to spread negative stories about the stock. Reactions to Cramer’s remarks are divided about whether he is performing a public service in revealing widespread market manipulation and whether he is providing how-to guide to manipulating stocks.
The New York Post broke the story this morning:
In the video from TheStreet.com’s “Wall Street Confidential” Webcast, Cramer boasts about manipulating the price of a high-flying stock down, and even acknowledges that doing so might have been illegal. The video is making the rounds on YouTube.
“A lot of times when I was short, I would create a level of activity beforehand that would drive the futures. . . . It’s a fun game,” Cramer said in the Webcast, which was moderated by TheStreet.com Executive Editor Aaron Task.
Cramer later said that “no one else in the world would ever admit that, but I don’t care.”
One added thing to watch for: Jim Cramer takes a swipe at easily manipulated financial reporters, who he calls “the Bob Pisani’s of the world.” We’re sure his CNBC colleague appreciates it.
Cramer Reveals A Bit Too Much [New York Post]
Elliot Spitzer’s good buddy. Guess now that The Monopolist of Virtue has moved on to the Governor’s mansion he can say it is no longer his place to go after behavior like Cramer’s… though jurisdictional issues never stopped him in the past…
wasnt this on bankersball a month+ ago?
i thought everyone know about it..
He’s like a battle tested spiv spilling all his trade secrets. All this crap is what is wrong with the market — hedge funds manipulating prices so real accounts get horrible execution.
I hope they cancel his show and indict the bastard.
Blue horseshoe loves Anacot Seel.
Rules for a Thief:
1. Never admit you stole something, especially on camera or other recording device
2. Deny any knowledge of stealing something
3. Make counter accusations. Defer blame on the “system”
4. If you are caught, do not announce your methodology for stealing (especially if you were any good at it) No shit you manipulate numbers, we are all in finance; just don’t advertise.
5. As your activity increases, don’t be surprised by an influx of burglar alarms, regulations and investigations.
6. Lastly, if you happen to be a thief in finance, don’t have a tv show recommending stocks to the average investor and then tell an online industry tv show how you got rich screwing the average investor.
Given that Cramer’s been out of the game for a long time, he’s not really at risk. Statute of limitations let’s him speak on this.
Plus he put similar comments in Confessions of a Street Addict. It does help to have been the AG’s Law School buddy, hedge fund manager, and major campaign donor. Spitzer is a corrupt fraud who only goes after people he doesn’t like and who he wants to use for political advantage. AGs shouldn’t be able to run for any position for at least 20 years, and it shouldn’t be an elected position.
GOOD NEWS!!! There is finally a great movie out about stock market manipulation, the SEC, and short selling called: “Stock Shock.” Amazon has it or stockshockmovie.com has a trailer. Jim is in the movie.