4 ms·

So what if subprime blows up? (July 16, 2007)

8 points by pw0ncakes 17y ago

fnid2 17y ago
Mark Twain said, "You need two things to survive in this world: Ignorance and Confidence." Jim Cramer has a lot of both.
pw0ncakes 17y ago
For a bit of historical trivia, July 26, 2007 was when debt markets began panicking, causing the meltdown of Bear Stearns hedge funds, thus leading to the collapse of Bear and Lehman, thus bringing on the crash of 2008. So this is like saying "So what if an Archduke gets shot?" in early June, 1914.
- adamhowell 17y ago
  And of course Kramer followed up nuggets of wisdom like this with "Bear Sterns is fine!" just 5 days before they were sold for $2 a share: http://www.youtube.com/watch?v=gUkbdjetlY8 http://www.youtube.com/watch?v=gUkbdjetlY8 I really thought his Daily Show appearance would be the beginning of the end for him, but obviously I overestimated the long-term memory of the average CNBC viewer.
  - deleted 17y ago
    [deleted]
  - hga 17y ago
    BZZZT! He said something to the effect that brokerage accounts at Bear Sterns were safe, not that the firm, its stockholders or bondholders were safe. That's what "don't take your money out" means, vs. "don't sell your Bear Sterns stock or bonds". A very different thing, and from what I've heard in the worst case he still would have been right. And you'll note that he called the subsequent buyout correctly ... and that very statement shows that he's not saying the firm "is fine".
prbuckley 17y ago
How does Jim Cramer still have any scrap of credibility?
- pw0ncakes 17y ago
  How do Republicans? Or corporations? Or the concept of private health insurance? Too Big to Fail-- not just for firms, but for people and ideas as well.
  - lmkg 17y ago
    For how flippant it appears, I think this is very close to the truth. People have so much mentally and emotionally invested in a particular idea/messiah/institution, that the cost of changing or rejecting that idea is basically admitting that the past several decades were lived in mistake, and changing those ideas would require a drastic self-evaluation. It's like vendor lock-in for ideas.
    - pw0ncakes 17y ago
      People, especially in the U.S., underestimate the amount of noise and outright corruption in determining what makes something successful, established, and well-known. They also personalize success and failure to the extreme. What differentiates the intelligent is that they're able and willing to question their assumptions. Such people tend to be more liberal, which is why the left is much less cohesive (and in a two-party system, much weaker) than the right. Ask any liberal about Obama and you'll hear 10 different disagreements and criticisms, whereas Palin can do no wrong among her fan base.
  - byrneseyeview 17y ago
    Democrats did not exactly try to prevent people from buying homes they couldn't afford--or to prevent the government from spending money they didn't have. "Corporations" have done pretty okay, insasmuch as they are still capable of spending less than they take in. Private health insurance is still very exciting to, e.g., Canadian politicians. A health care system in which costs are not paid by a) the physician, or b) the patient, is necessarily going to have high prices, shortages, or both. But regarding "Too Big to Fail," in Influence, Robert Cialdini writes about a cult that predicted apocalypse on a particular date. Before the apocalypse, they were insular; after they missed their deadline, many members became aggressive recruiters--they had to invest more in the cult, so they wouldn't admit to themselves that it was a sham.

8 points by pw0ncakes 17y ago

fnid2 17y ago

Mark Twain said, "You need two things to survive in this world: Ignorance and Confidence." Jim Cramer has a lot of both.

pw0ncakes 17y ago

For a bit of historical trivia, July 26, 2007 was when debt markets began panicking, causing the meltdown of Bear Stearns hedge funds, thus leading to the collapse of Bear and Lehman, thus bringing on the crash of 2008. So this is like saying "So what if an Archduke gets shot?" in early June, 1914.

adamhowell 17y ago
And of course Kramer followed up nuggets of wisdom like this with "Bear Sterns is fine!" just 5 days before they were sold for $2 a share: http://www.youtube.com/watch?v=gUkbdjetlY8 http://www.youtube.com/watch?v=gUkbdjetlY8 I really thought his Daily Show appearance would be the beginning of the end for him, but obviously I overestimated the long-term memory of the average CNBC viewer.
- deleted 17y ago
  [deleted]
- hga 17y ago
  BZZZT! He said something to the effect that brokerage accounts at Bear Sterns were safe, not that the firm, its stockholders or bondholders were safe. That's what "don't take your money out" means, vs. "don't sell your Bear Sterns stock or bonds". A very different thing, and from what I've heard in the worst case he still would have been right. And you'll note that he called the subsequent buyout correctly ... and that very statement shows that he's not saying the firm "is fine".

prbuckley 17y ago

How does Jim Cramer still have any scrap of credibility?

pw0ncakes 17y ago
How do Republicans? Or corporations? Or the concept of private health insurance? Too Big to Fail-- not just for firms, but for people and ideas as well.
- lmkg 17y ago
  For how flippant it appears, I think this is very close to the truth. People have so much mentally and emotionally invested in a particular idea/messiah/institution, that the cost of changing or rejecting that idea is basically admitting that the past several decades were lived in mistake, and changing those ideas would require a drastic self-evaluation. It's like vendor lock-in for ideas.
  - pw0ncakes 17y ago
    People, especially in the U.S., underestimate the amount of noise and outright corruption in determining what makes something successful, established, and well-known. They also personalize success and failure to the extreme. What differentiates the intelligent is that they're able and willing to question their assumptions. Such people tend to be more liberal, which is why the left is much less cohesive (and in a two-party system, much weaker) than the right. Ask any liberal about Obama and you'll hear 10 different disagreements and criticisms, whereas Palin can do no wrong among her fan base.
- byrneseyeview 17y ago
  Democrats did not exactly try to prevent people from buying homes they couldn't afford--or to prevent the government from spending money they didn't have. "Corporations" have done pretty okay, insasmuch as they are still capable of spending less than they take in. Private health insurance is still very exciting to, e.g., Canadian politicians. A health care system in which costs are not paid by a) the physician, or b) the patient, is necessarily going to have high prices, shortages, or both. But regarding "Too Big to Fail," in Influence, Robert Cialdini writes about a cult that predicted apocalypse on a particular date. Before the apocalypse, they were insular; after they missed their deadline, many members became aggressive recruiters--they had to invest more in the cult, so they wouldn't admit to themselves that it was a sham.