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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Moominoid who wrote (67270)	8/11/2005 10:40:33 PM
From: shades	Read Replies (2) \| Respond to of 74559

A lot of people are trying to say Cramer is this brain who made 24% a year during his hedge fund years and harvard grad - OK - but look at the years he made those returns - those were the easiest years in the past 100 years to make those kind of returns no? Buffet did well good or bad years, but I have not been shown any data that cramer is a good investor when things get tough and the weeds are rooted out. Here are some of his calls in the past - if you have more data to support or refute his claimed "genius" please share. itulip.com I watched Cramer today, only because Mr. Phil Grandie said cramer would pump INTEL so he could dump at 34 - and sure enough Cramer pumped INTEL on his CALLING THE TOP special show. I am seeing him pop up on boards I read all over the internet, I have just read this and think this applies regarding cramer: From the pkarchive folks: This is how tne real estate bubble will end From Mr Bruce Steinberg. Sir, It was fascinating to learn how Meg Whitman, eBay president and chief executive, looks 'for markets where there is price and information inefficiency' yet declares 'real estate is pretty darn efficient' ('From Netscape to the Next Big Thing'. Comment & Analysis, August 5) in the face of a much ballyhooed real estate bubble. In 2001, the Nobel prize for economics was awarded to George Akerlof, Michael Spence and Joseph Stiglitz for their work on how asymmetrical information influences economic markets. Their theory, first described by Akerlof in the 1970s in an essay entitled 'The Market for Lemons' ('lemons' being a colloquialism for bad used cars), explains how when one party in a market has more information than the other, this unequal information can lead to adverse selection and ultimately the collapse of an entire market. Oversimplified, bad products and services chase out buyers seeking good products and services and both buyers and sellers of good products and services suffer. The full theory can be applied to the efficiency of labour markets as well as the collapse of the IT bubble. For the former, workers out of work tend to stay that way because potential employers assume those workers are not good enough for a job and tend to offer insufficient pay to attract the best candidates. However, in the case of permanent recruitment services, staffing services as well as temporary employees bring more information to the 'buyer' to enable the potential employer to make a more reasonable job offer than they would offer an unknown candidate. Perhaps the success of job boards can be partially attributed to their providing more labour market information to all parties involved in the employment process. The theory can also be used to explain how the IT equity bubble burst. Early in the dotcom era, the casual observer or investor viewed all IT companies as more or less identical although in reality their profit potential varied greatly - only insiders knew which were which. Low-profit but over-valued companies tended to follow the path of least resistance to fund their financial expansion by issuing more of their own shares and hence attracted more attention in the early developmental stage of the sector. Although seasoned investors and experienced venture capitalists may have known they were backing shaky high-tech and dotcom companies and knew it was a bubble, they believed they could ride the wave, profit wildly and get out in time. Eventually all investors became more educated, realised the valuations were not based on any profit potential, dumped their shares and prices plummeted. In the current real estate environment, ultimately there will not be enough inexperienced buyers and real estate speculators - those who do not know the true value of the property they are purchasing - to go around. The educated will ultimately regain control of the market and the current bull real estate market, which at times looks similar to a Ponzi scheme, will end. Then Ms Whitman may reconsider her view of price efficiencies in the real estate sector. Isn't it nice to see a practical application to economic theory? Bruce Steinberg, Economic and Employment Consultant, Alexandria, VA 22309, US ------------------------------------------------ Meg Whitman, eBay president and chief executive: 'I look back and say, 'What were we thinking?' We quit two jobs, moved to California, put the children in new schools. I didn't think it was going to be anything like it turned out. I thought eBay could be a great collectibles website for the US. I thought this could be a small, quite profitable company. 'We began to understand that what worked in collectibles would work in other markets as well What eBay does is make inefficient markets efficient. 'The business model is very powerful. We were able to move globally far faster than land-based companies can. The remarkable thing about eBay is that it's instantly local: 98 per cent of our content is user-generated. 'The other thing I wasn't expecting was the way the market empowered small businesses. That was a big surprise. I thought this would be the home of big business. But it has levelled the playing field, and made small businesses as accessible as big ones. That was an 'a-ha' moment. 'Some categories didn't work the way we thought they would. We look for markets where there is price and information inefficiency. It turns out that real estate is pretty darn efficient. 'I am startled by the ubiquity of the internet today. It is one of the fastest-growing technologies ever. It's just remarkable. It has changed the way we communicate, the way we play. E-mail has changed the way business is conducted. 'The timing may finally be right now for mobile access. We thought it was important to have mobile access to eBay and the net five years ago, but nobody used it. That could be changing because of the growing power of mobile phones. In countries like China and India, you may see a shift to primary access to the internet coming through mobile handsets. Moving to 100 per cent broadband penetration will also make a huge difference. You will see an always-on internet that changes the way people behave. 'There is still room for new internet leaders to be created. Of the five biggest internet companies 10 years from now, I can imagine that two or three of the existing leaders will stay on, but that two will be companies that haven't even been bom yet. The internet is an incredibly dynamic environment. You have to respond really fast.'