Tuesday, October 7, 2008

Jim Cramer and Wachovia Bank

Any day now Cramer will come out and say how badly he missed the call on Wachovia Bank. Oh wait, we are talking about Cramer, so skip that first point. He was trying to pump up WB for some reason for the past few months. I don't know if he was just hoping he could claim a winner because WB had made it to this point and may be able to weather the storm because of it large deposit base but he was destroying capital all the way down. Evidently no one remembered that WB scooped up World Savings a while back along with their bundles of option arm mortgages. The vulture banks in their hubris thought they could snap up these failing companies at fire sale prices and suffer no consequences but even Bank of America is showing signs their anchor is dragging. They swoop in and buy mortgages for pennies on the dollar without ever figuring out their true value and then expect the federal government to take the losses. WB and Bank of America both acquired assets for pennies on the dollar and intended to milk them for all they were worth. They aren't going to lend more in order to get the housing market flowing, but are hoarding cash, looking for a bailout. As for Cramer and his WB pick and pump who knows but he is now telling everyone to exit stage right after driving them off a cliff for the past year. Hubris, narcissism and arrogance at its finest. Cramer seems like a nice guy but he really is a modern day media creation.

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