Cramer Issues a Challenge -- Bet Against Him
By James J. Cramer
06/12/2003 09:03 AM EDT
URL: thestreet.com
Let me make this real clear: You think I am wrong on the housing "bubble"? Go short Lennar (LEN:NYSE - news - commentary) and Toll Brothers (TOL:NYSE - news - commentary) .
You think that there is no bubble in Treasuries. Go buy the 30-year.
You think that tech has moved up too fast? Go short the biggest gainers or an index.
You think that the world is coming to an end? Why the heck are you debating with me? Go to Machu Picchu, where it might end last.
I am not an academic. In fact, I disdain academics. I tried to take a number of business school courses about the markets and all of them left me without any direction or ability to make money. I like books about blackjack and horse racing more. They are for practitioners. Which is what I am.
So many of you say, "Last night you were too bullish, blah, blah, blah." To which I say, bet against what I like. So many others say, "You are so wrong about this or that." Bet against me, for heaven's sake. I am a big guy. I can handle it.
I remember in 1987, when I was working out of Michael Steinhardt's office, he asked me what my favorite stock was. I told him, "Toll Brothers." He said, "Oh yeah, what do you know about Toll Brothers I don't."
I told him that I thought the multiple was cheap and that it would expand when rates go down. He picked up the phone, asked for his head trader, got my wife-to-be, and said, "Short 50,000 Toll Brothers every half point up beginning at $26."
I said to him, "No, I like Toll Brothers. I didn't say to short it." He looked at me funny and said, "Of course you didn't. But you know nothing and have no conviction."
A week later I saw him and Toll Brothers had gone up a buck and change. He asked me what was going on with Toll Brothers. I said, "Beats me." He asked me if I still liked it. I said, "Yep." He said he was shorting more.
Not long after Toll reported a great quarter. The stock went up again. At this point he was laughing about it. He smiled and laughed and asked why I didn't tell him the truth, that I knew it was going to be a better-than-expected quarter.
I smiled and laughed in return.
He never bet against me again. |
