Tuesday, January 11, 2011

10 Things I Learned Working With Jim Cramer

I rarely watch Cramer and have a slightly negative view of his antics, but Altucher is a good writer and this is an interesting story. -RW

By James Altucher

The first time I met Cramer was on the set of his show “Mad Money”. The show hadn’t officially launched yet but he wanted to try out the idea of having guests on the dress rehearsals. I was the first guest. I did so poorly he immediately dashed the idea (at least initially) of having guests on the set. I wrote for thestreet.com for years. I sold a company, Stockpickr, to them. I probably did dozens of videos with Jim after that and got to know him quite a bit.

In the meantime, some disclaimers: this article has nothing to do with his stock picks. There’s been plenty of articles about those in either direction. I haven’t watched his show in years. I don’t subscribe to his newsletter or follow his picks and I haven’t read his last book or so.

Second, this is not some “ass-kissing” article. I have nothing to do with thestreet.com. I haven’t spoken to Jim in over two years. I have zero business relationship with Jim or thestreet nor do I intend on having one. If anything, I’m going in the exact opposite direction of writing about stocks.

Ten things I Learned from Jim Cramer

1) Return emails. I’m somehow incapable of doing this. If my own mother sends me an email it might take me six months to return it. I was just a day late even wishing her a Happy Birthday. (which was January 9. I wrote an email on January 10. To my own mother). I’m a horrible communicator. In the fall of 2002 I wrote Jim and gave him 10 ideas for articles he should write. This was during a period (described in an earlier post, or maybe a post I plan to write but haven’t yet) when my only idea for getting out of the gutter I was in was coming up with ideas for other people and sending it to them. I sent out emails to twenty people all with ideas. Some of the article ideas I suggested Jim write were “10 stocks trading below cash” (this was September, 2002 where even TSCM was trading below cash). 10 convert arb opportunities, How to trade gap down opens, etc. (Only one other guy responded to me and I ended up trading for him, starting a career trading for several hedge funds and then starting a fund of funds. Here are 10 things I learned trading for Victor Niederhoffer).

Jim wrote back almost immediately: “You should write these!” And I began writing for thestreet.com then. My first writing gig. I framed the $200 check I got after I wrote my first article for them (the framer said, “are you sure you don’t want to cash this?”). When I sold Stockpickr to thestreet, Jim signed the back of that $200 check.

I need to get better at responding to people who write to me. Jim writes back instantly to just about anyone. I think the key is to even be able to write back and say “Thanks!” just to acknowledge that you read what the person has to say and that you realize he exists. I always feel like I have to write a detailed personal letter whenever I respond to someone. So emails pile up. I just started going through my back-emails. After two hours I got back to January 1 and stopped. For now.

2) Financial Media = Entertainment. Lets not fool ourselves. Jim is first and foremost an entertainer. If you have a TV show where you wear costumes, yell at the screen, throw chairs, and interview guests often in the hope for some laughs then I don’t think anyone would call that anything other than entertainment. Jim has said this repeatedly that he’s an entertainer. 99% of people shouldn’t be buying stocks anyway (this is my opinion) and those that do buy stocks should do their own research. And Jim’s the best entertainer in the financial media business. Really look at his show and watch what he does. he combines education, with interviews, with six or so different voices (he takes voice lessons, or did at least, to be able to do all that he can do with his voice in a show and not go hoarse after a few days), with stock picks in different industries, call-ins, and even magic tricks (the lightning round, more on that later).

I’ve been on TV quite a bit, but Jim is the best by several orders of magnitude. Jim always delivers more value than the simple “buy IBM” that still pervades most financial blogs.

3) Ignore the Haters. I feel like I’ve been brutalized quite a bit. I was bullish in 2008. But stuck to my guns in 2009 and 2010 and had many picks with 100%+ returns. But I really have had a hard time personally dealing with the haters. (See, 7 Reasons to Hate Me). And they came from all corners. People who were your friends one day, turn up anonymously on message boards the next trashing you in every possible way. But Jim’s seen far worse. The front page Barrons article in 2007 was brutal for him. The Jon Stewart escapade where Cramer was like a deer in headlights and didn’t say, “but Jon, at the very bottom, on the Today Show, I told everyone to get out of stocks”. Why didn’t you say that, I IMed him at 3am the next morning and he just wrote back, “who cares.” That might’ve been the last time I IMed with him.

4) Commentary belongs in Financial Journalism. Cramer changed everything when he started thestreet.com and added commentary from professional investors into the mix. The negative argument was then (and still is) that there is a conflict of interest if someone owns a stock to be then talking about it on a platform meant for serious journalism. But that’s bullshit. Who better to write about a company then someone who has serious resources and used those resources to dig under every rock and uncover as much as they can before putting hard-earned money to work. Journalism has changed over the past 15 years to accept this and move the needle even further but at the time it was a contentious issue.

5) Know Everything. I was standing by a TV with Jim once and the ticker was running by at the bottom of the CNBC screen. He started doing a lightning round on every stock going by, telling why each stock was up or down a nickel, a penny, a whatever. He knew every earnings report, every news item that was relevant that day. He doesn’t know every stock (see below) but he does know everything he needs to know for THAT DAY. This doesn’t mean you should know everything about stocks. But whatever field I’ve been in I’ve always tried to know everything about the competition, the technology, the subtleties and the nuances of the field. Jim has dominated financial media for 20 years by doing this. Whenever I’ve invested in a private company, the most important criteria I have is that the CEO has the same kind of database of knowledge in their industry that Jim has in financial media (note: I say “media” and not just “stocks”).

Read the rest here.


  1. A few years back when my interest in economics really took off, I went to Barnes and Noble hoping to pick up a new book to read. I almost picked up one of Cramer's books.

    I don't know what stopped me, but whatever it was I'm glad it did.

    Instead, I picked up: http://www.amazon.com/Economics-One-Lesson-Shortest-Understand/dp/0517548232/ref=sr_1_1?ie=UTF8&qid=1294846711&sr=8-1

  2. Has anyone ever noticed that Cramer has a poster of Mao and Lenin in the background on his set? What kind of insanity is that? Or maybe I'm just missing something.

  3. Cramer is just a psychotic parasite like Mao and Lenin in that Cramer will justify murder in order to further his own power and wealth within the politically violent nation state. Cramer is one of Orwell's pigs.

  4. I just noticed the poster of Mao and Lenin? What the hell? He is making money from capitalism yet he has a picture of those two!!