hey apparently I'm an 'institution' lol.....been e-mailing with him past week on these ugly deals and I thought he should warn people off these things since he's got the big mouthpiece of the show/his site etc...
Ugly IPO Deals Make Brokers Look Bad
By James J. Cramer
RealMoney.com Columnist
5/11/2005 12:58 PM EDT
Click here for more stories by James J. Cramer
IPOs
The Lazard and Warner Music deals are inspiring new levels of revulsion about the brokerage industry.
These two force-fed deals are testaments to how Wall Street caters only to the clients who sell.
Worse, Goldman Sachs is betraying its better policy of 'long-term' greed and showing its desperation to make the quarter.
"The Warner Music (WMG:NYSE - commentary - research) deal was just as ugly as Wassterstein's Lazard (LAZ:NYSE - commentary - research) deal. I've been doing this for a long time and I am just getting sick and tired of these greedy, grabfest offerings. Who is taking down stock on these things? And aren't they tired of losing money yet?"
I think that sentiment, from an institutional emailer of mine this morning, really sums up the professional mindset right now. Watching the Street puke up the Warner Music deal in the same fashion that it puked up the Lazard deal -- both pieces of Goldman Sachs merchandise, by the way -- makes me think that we really are reaching new levels of revulsion about the brokerage industry.
These two force-fed deals are testaments to how Wall Street really could care less about the clients who buy and caters only to the clients who sell. It's not like the old days, either. You can't get the hot deal rewards you used to, because that's no longer kosher. So now all you get is the punishment of the bad deals.
When I was at Goldman Sachs, we were taught to be long-term greedy: You help your clients longer-term and you do well. These two pieces of business, Lazard and Warner, are just brutal. They defy that long-term greed logic. These two deals are a testament to raw greed, on the part of the issuers and on the part of the underwriters. They should be ashamed.
Now, perhaps they didn't put the hammer to clients as they used to for crummy merchandise. Perhaps they are walking around long the whole pile of merchandise and figure they get paid enough on the deal to take the hit.
But I have to tell you, this Lazard-Warner stench is exactly the wrong message for Goldman -- and Wall Street -- right now. It says, "You know what, we are so desperate to make our quarter, we will bring anything public."
Thanks, but no thanks.
Nobody needs to make money that badly. |
