11/18/2006

The Money Shaman

TheStreet.com is running a ten-year Jim Cramer retrospective -- seven pages worth of what was up-to-the-minute a decade ago. I definitely haven't read all of it (or much of it, really -- just auditing to see if his columns match his book). But one column reminded me of a few other Cramerisms, and probably said way more than it meant to: "Red Hots are Candy". Read it!

And then ask yourself: How seriously does he take his whole "The market will hate you if you do the wrong thing" shtick? It comes up in a few other books and columns -- he'll mention selling off his best positions to get back a winning streak -- but I'm not sure if it's meant to be quaint trader lore or an accurate description of his thought process. Perhaps I'm thinking more like an economist than like a trader, but when he says, essentially, "Any one of these stocks will do well, but owning a lot of them will make them go down," he's espousing a view of the market that's best described as Shaman worshiping the rain god or the tree god or the rock god: "Accept the gift of portfolio-saving growth stocks, but don't be greedy or you'll irritate the Bubble God!"

This doesn't make him a bad investor, just worse than he could be. You can accumulate lots of mostly accurate half-truths even operating with a bad model (there's a reason they call a Shaman "Witch Doctor"), but that attitude is still confusing to me and probably harmful to some of his readers. So seriously, Jim: Whether you're joking or just crazy, you really need to stop this Shamanist Trading.

This blog is no longer being updated. Visit ByrneHobart.com for more blogging, or pay a visit to my new Internet stock research and M&A due diligence company.


posted by Byrne Hobart at 1:25:00 AM

1 Comments:

Anonymous QUALITY STOCKS UNDER 5 DOLLARS said...

Great stuff and then some.

1:56 AM  

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