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Cramer Launches Flash Defense Campaign

Tyler Durden's picture




 

This particular Cramer infomercial (just like all others) brought to CNBC courtesy of whoever, as usual, has provided the most in GE indulgences for any particular donation campaign. Pure comedy value, and if you act now, CNBC will throw in the 8 pm spot for free.

 

 

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Tue, 09/22/2009 - 09:40 | 76224 Cognitive Dissonance
Cognitive Dissonance's picture

"Something as insignificant as flash."

Straight from the mouth of Cramer.

While I agree the SEC is next to useless, so is Cramer and his Cramericans.

Tue, 09/22/2009 - 09:54 | 76251 Missing_Link
Missing_Link's picture

I have to give the SEC some credit: they're at least TRYING to do the right thing, and occasionally, as with flash, they do sometimes get it right.

I don't think I've ever seen an honest word out of Cramer's mouth.

Tue, 09/22/2009 - 10:42 | 76295 JohnKing
JohnKing's picture

Cramer is the "tell" for SEC findings, more than likely the SEC will parrot him, this stuff doesn't just pop into his head.

Tue, 09/22/2009 - 09:33 | 76226 bonddude
bonddude's picture

disgusting...buy,buy,buy!

Tue, 09/22/2009 - 09:36 | 76227 phaesed
phaesed's picture

Gosh.... When this new sandcastle finally gets taken away by the tide, I so hope to see this idiot crucified by the same idiots who listened to him.

Tue, 09/22/2009 - 09:53 | 76250 lsbumblebee
lsbumblebee's picture

It will never happen. He's a pathological liar and will deny he ever said this was a bull market. And his followers are idiots who believe anything he says because he's on teevee.

Tue, 09/22/2009 - 09:55 | 76255 phaesed
phaesed's picture

I dunno... I truly loved the Jon Stewart interview.

Tue, 09/22/2009 - 15:45 | 76629 Green Sharts
Green Sharts's picture

It didn't happen after his "Winners of the New World" speech and column at the Nasdaq peak in early 2000.  You can easily find via an internet search.  He was banging the table for a basket of stocks, saying they were the only ones to own, that subsequently went down over 95% as a group.

A few years later he was claiming that he warned people to get out of the Nasdaq before the tech bubble peaked.

Tue, 09/22/2009 - 09:39 | 76228 Anonymous
Anonymous's picture

Former Golman Sachs employee defends flash trading. I'm shocked!

Tue, 09/22/2009 - 09:42 | 76230 Mediocritas
Mediocritas's picture

Does anyone, with an IQ that requires more than ten fingers to count, actually listen to a word Cramer says?

Tue, 09/22/2009 - 09:54 | 76253 Cognitive Dissonance
Cognitive Dissonance's picture

Unfortunately yes. You would be surprised how many of my (reasonably intelligent) clients call me in the morning to inform me of the latest buy buy buy item of interest that came from the mouth of Cramer the night before.

I'm talking 2-3 calls a week and not from the same 2-3 clients. He has an audience because he tells people what they want to hear, which is the easiest job in America.

Tue, 09/22/2009 - 10:14 | 76272 JohnKing
JohnKing's picture

ahhh..this may come as a shock to some but a LOT of fund manager/pension guys do listen to and act on Cramers "stuff".

Tue, 09/22/2009 - 14:36 | 76544 DaddyWarbucks
DaddyWarbucks's picture

That is a sobering thought. At least in baseball we get stats on all the players. I wonder if the SEC could handle that job? at least it would get them off their knees now and then.

Tue, 09/22/2009 - 12:42 | 76396 snorkeler
snorkeler's picture

Cramer needs to do hard time.

Tue, 09/22/2009 - 13:21 | 76446 Anonymous
Anonymous's picture

I get to 512 with base two and ten fingers.

Tue, 09/22/2009 - 14:13 | 76512 Anonymous
Anonymous's picture

Then you are a magician.

Tue, 09/22/2009 - 09:44 | 76232 Bearish Spirits
Bearish Spirits's picture

How can anyone take this seriously?  He never actually told the viewers what flash trading is, just some of the effects it has.  And to claim that it's good for the retail investor?  Please.

Tue, 09/22/2009 - 10:07 | 76264 Anonymous
Anonymous's picture

Flash is/was either neutral for the retail investor, or slightly positive for them if they had trading accounts with a brokerage firm that passes on ECN rebates.

When you are a retail investor dribbling out small orders with no attempt to iceberg large orders (i.e. you are not a mutual fund trying to move millions of shares in stealth mode), then there is no way that the 30ms look ahead endangers your future trades to being affected by a HFT firm.... because you have no such future trades.

Pattern matching and any attempt to "front run" (a misused term but what you're all expecting to hear) a retail investor who is manually entering in small orders is a strategy to lose money... and if a retail investor is lucky enough to have their order placed on a flashing ECN hit by a HFT trader, than either they or their broker (depending on the broker) is going to get a price improvement via the liquidity rebate.

The way flash hurts retail is when retail holds mutual funds that are stupid enough to choose to route their big orders to venues that flash (something well within their control to avoid!). But retail investors would do well by pulling all of their money from those mutual funds and avoiding the much larger fees that they are paying to have nice glossy brochures printed up.

Cramer is surely a bafoon, but on this count, he is correct.

Tue, 09/22/2009 - 11:14 | 76336 Bearish Spirits
Bearish Spirits's picture

Much of that may be true.  My point is that he is flat-out stating that it is "GOOD" for the retail investor in order to get them on his side against the SEC.  Of course, we know Cramer and the SEC have had a friendly history...

Tue, 09/22/2009 - 11:24 | 76341 monkeyshine
monkeyshine's picture

Indeed. Flash trading isn't the crime. High Frequency Trading is.  These machines are buying and selling and selling and buying shares back and forth all day every day. If I ping-ponged shares to you and you ping-ponged them back to me and we whacked up all the pennies we collected from the small lot individual traders at the end of each day, we'd go to jail for stock manipulation.  But if I set up two computers to do the same thing and keep all the money for myself, I'm just a creative investor.

Tue, 09/22/2009 - 11:44 | 76369 Anonymous
Anonymous's picture

You would not go to jail (there is nothing illegal in what you suggest provided you are trading your own money rather than a client's) - but you would go to the poor house.

How do you envision making a profit trading the shares back and forth with someone allied with you (i.e. seeking profit in the same way you are - which is identical to trading with yourself)?

You will need to cover the bid/ask spread round trip, and the ECN rebates you get from adding liquidity (assuming you are fast and lucky) will not cover a 1 penny spread.

Tue, 09/22/2009 - 14:40 | 76549 DaddyWarbucks
DaddyWarbucks's picture

In cards it's called cutting up the pot and the practice has been known to cause broken fingers.

Tue, 09/22/2009 - 14:19 | 76522 Anonymous
Anonymous's picture

Trust me, flash is negative for users. If you place a crossing Flash order on NASDAQ, and I see the order hitting NASDAQ and that's about to take out the remaining 100 on ARCA, I'm going to go hit ARCA before NASDAQ does. I get the price level and you don't, even though you placed your interest.

Tue, 09/22/2009 - 15:45 | 76627 Anonymous
Anonymous's picture

Great - so you now have 100 shares you didn't want before, and you hope to unload them to who?

You just intercepted a retail order with nothing behind it... so there is no reason to think that you can improve upon the price you just paid....

It is a losing strategy. If you wanted the shares, you would have hit the ARCA initially... and if you didn't want them, you now have them and exactly no incremental information about further demand (since this was a retail order with no iceberg).

Tue, 09/22/2009 - 09:45 | 76233 NoBull1994
NoBull1994's picture

Who is that "strategist" CNBC puts on that proceeds to speak in Ebonics about how the stock market is going back to all time highs?  Is this the best GE can do in its affirmative action program?

Tue, 09/22/2009 - 10:05 | 76259 Anonymous
Anonymous's picture

I'm not sure but word is CNBC is committed to bring these 2 analysts in for daily premarket commentary.

http://www.youtube.com/watch?v=8EvR3_S23KM

Tue, 09/22/2009 - 12:53 | 76409 ZeroPower
ZeroPower's picture

hahaha nice one. pretty much the type of analysts they have on CNBS most of the time..

Tue, 09/22/2009 - 09:45 | 76234 Tripps
Tripps's picture

anyone who had any respect for cramer's teaching ability...lost it all on this one

 

 

Tue, 09/22/2009 - 09:47 | 76235 Anonymous
Anonymous's picture

Few know this... but according to several ex Cramer-Berkowitz employees, Jim Cramer was known to be Bi-Polar with heavy dependency on various prescribed drugs for the diagnosis and cure. With that tidbit of information -- is anyone surprised by this guy's often volatile, reckless, and impulsive behavior? Why even give this moron any more attention.

Tue, 09/22/2009 - 09:49 | 76236 Cognitive Dissonance
Cognitive Dissonance's picture

Marc Faber doesn't paint a very nice picture. Silly me but I have a tendency to listen to people who got it right in the first place.

"The future will be a total disaster, with a collapse of our capitalistic system as we know it today, wars, massive government debt defaults and the impoverishment of large segments of Western society."

 http://finance.yahoo.com/tech-ticker/article/337749/Bullish-Today-Marc-Faber-Is-%22Highly-Confident%22-the-Future-Will-Be-Very-Bleak?tickers=%5EDJI,%5EGSPC,EEM,FXI,VNM,EWZ,SPY&sec=topStories&pos=9&asset=&ccode=

Tue, 09/22/2009 - 09:51 | 76243 Gilgamesh
Gilgamesh's picture

A mind above all.

Tue, 09/22/2009 - 09:48 | 76238 Anonymous
Anonymous's picture

I hope SEC one would wake up and shut down the Cramer-like stock cheerleaders on CNBC. The average investor is being milked and it's incomprehensible that no one takes any action against those crooks on CNBC.

Tue, 09/22/2009 - 09:49 | 76239 lizzy36
lizzy36's picture

Why is there a shot clock on his cramerica infomercial set?

Tue, 09/22/2009 - 09:51 | 76242 Missing_Link
Missing_Link's picture

So according to Cramer:

 

-Leveraged ETFs are bad;

-Flash trading is good;

-There are a lot of "scam artists" and "scoundrels" out there who confuse and mislead individual investors, and he's actually NOT one of those people and is trying to PROTECT us from them.

 

Down is up, up is down, black is white, white is black.  Wheeeeeeee!!!!!!!!!!!!!!!!

Tue, 09/22/2009 - 09:53 | 76248 Anonymous
Anonymous's picture

Please post a poll.

What new torture technique should be adopted at Guantanamo?

1) 24/7 Cramer
2) 24/7 Obama speeches

Tue, 09/22/2009 - 09:58 | 76256 RobotTrader
RobotTrader's picture

Tue, 09/22/2009 - 10:13 | 76268 BobPaulson
BobPaulson's picture

But Cramer said the stock is a steal at 24 and the industry can only go up. 

"They're not making new coffee land anymore"

Tue, 09/22/2009 - 10:24 | 76278 JohnKing
JohnKing's picture

Is that what momo-junker algos do on a reverse slam?

Tue, 09/22/2009 - 10:32 | 76282 mule65
mule65's picture

Yuck, Burnt coffee.  Booyah!

Tue, 09/22/2009 - 10:48 | 76302 Dr Horace Manure
Dr Horace Manure's picture

Dear Tyler Durden, RobotTrader, Project Mayhem, etal:

By now ZH must be attracting thousands of new readers each week.

ZH challenges me to think in new ways, and to research and learn about things I've never heard of, and because of this I am now addicted.

BUT, too often I am left totally clueless about what people are saying, and this is very frustrating.

This post by RT is a perfect example of what I mean by this.  Please, just a short explanation for us Newbies would be greatly appreciated.

Tue, 09/22/2009 - 10:57 | 76312 deadhead
deadhead's picture

i'll take a stab as far as the robo post...pls also know that i am not part of zh, just a commenter like the rest of us.

my view of rt's post is that he is very good about pointing out stocks that are continually gamed, whether it is ddrx, cit, aig, rf, ad infinitum.  what i perceive out of this is the macroscopic view that much of the u.s. equity action is a gaming exercise, certainly not an "investment" play in the traditional sense of the word.

the citi news is an example this a.m.....i've had an ongoing discussion with a certain someone about whether the house of saud or the singapore sovereign wealth fund was dumping their piece of shit C shares....this a.m.'s news confirms that (for now) the singapore team unloaded a boatload of this crap. 

Tue, 09/22/2009 - 11:09 | 76331 Dr Horace Manure
Dr Horace Manure's picture

Thanks for the explanation deadhead. 

Now I understand it, and your explanation will likely make it easier for me to understand some of RobotTrader's future posts.

I understand these guys are probably working at warp speed and have little time or patience for people like me.  But I believe people like me are becoming a larger and larger share of the ZH Nation.

Long live TD.  

Tue, 09/22/2009 - 12:55 | 76411 MsCreant
MsCreant's picture

I am TD. You are TD.

Tue, 09/22/2009 - 14:44 | 76552 DaddyWarbucks
DaddyWarbucks's picture

You are not a unique and beautiful snowflake ...  You know the rest.

Tue, 09/22/2009 - 11:04 | 76322 Chief Hatuey
Chief Hatuey's picture

Go to bigcharts.com and see their tutorial on chart reading.

 

Tue, 09/22/2009 - 11:36 | 76360 Dr Horace Manure
Dr Horace Manure's picture

It's been on my "TO DO" list for quite some time.

I just moved it to the top of my list.  Thanks for the suggestion.

Tue, 09/22/2009 - 12:59 | 76415 Anonymous
Anonymous's picture

For other people peering down the rabbit hole for the first time, check out the Deep Capture blog for detailed reporting on how the mainstream financial media is corrupted by a small group of Wall Street bastards. Some of the stuff on there will make your head explode, it is mind boggling that the mainstream media does not touch these stories.

Tue, 09/22/2009 - 17:38 | 76769 Anonymous
Anonymous's picture

Don't waste too much time on that, you'll become depressed, paranoid, and delusional.

Always keep in mind that the history books are full of this stuff. Greed, corruption, and war, are man's second nature.

Don't believe me, try reading Robert Graves 'I, Claudius' and 'Claudius the God'. An easy to read compendium of historical anecdotes from Roman historians during Emperor Claudius's lifetime. (Very good, fast read)

Just try to remember that the financial world is filled with sharks, snake oil salesmen, satan's little helpers, zombies, trolls, buffoons, shake down artists, and other assorted bunko experts willing to help seperate you from your hard earned money.

You have a long hard slog ahead of you, so in matters such as these, patience will be your only friend.

Caveat Emptor is my shield, and a good sense of humor my staff.

Tue, 09/22/2009 - 14:11 | 76506 long-shorty
long-shorty's picture

the one year chart on this name is mind-blowing

Tue, 09/22/2009 - 10:05 | 76260 Crab Cake
Crab Cake's picture

I wonder how much liquor and coke it takes for Cramer to look at himself in the mirror everyday?

Tue, 09/22/2009 - 10:06 | 76261 Chief Hatuey
Chief Hatuey's picture

If Crammer really cared about the individual investor who as he said has been "continuely gaffed by the big boys" maybe he should step up to the plate and do something like Dr. Len Horowitz and bring charges:

http://www.fluscam.com/Affidavit.html

He should have plenty of ammunition to share with judges:

http://www.youtube.com/watch?v=HRa0B34jMOQ

Tue, 09/22/2009 - 10:09 | 76266 BobPaulson
BobPaulson's picture

This guy is a perfect character for 1984.

This is actually a symptom of a huge structural problem predominant in the world but out of control in the US: it is the replacement of fact with belief, reason with emotion, debate with rants. Not to resort to too much hyperbole here, but it is essentially the apparent reversal of the renaissance -> enlightenment -> progress which led to democracy and civil rights.

Considering what forces profit from the people being illogical and childish, it's quite surprising in hindsight how many institutions based on equality that have flourished. 

Tue, 09/22/2009 - 10:33 | 76285 Missing_Link
Missing_Link's picture

+++

Tue, 09/22/2009 - 13:00 | 76416 MsCreant
MsCreant's picture

I was thinking V for Vendetta. Surreal news. Cramer is a bad acid trip that won't end.

"Attention party goers. Do not drop the brown acid, I repeat, do not drop the brown acid. If you look closely, you will see CNBC on the label."

Tue, 09/22/2009 - 14:47 | 76553 DaddyWarbucks
DaddyWarbucks's picture

1984 was "fiction". Check out the Tavistock institute for frightening reality.

Tue, 09/22/2009 - 10:14 | 76271 ShankyS
ShankyS's picture

No more Cramer vids please. Dude makes me wanna puke.

Tue, 09/22/2009 - 10:17 | 76275 digalert
digalert's picture

I'd have to agree with the Cramster. What's up with the lightning speed at SEC? They've proven to be an incompetent in the bag eight hour coffee break clueless organization. We need to see some jail time.

Tue, 09/22/2009 - 11:11 | 76329 Chief Hatuey
Chief Hatuey's picture

Maybe the WallStreet "gaffers" and Fed inistas told their regulatory minnion (SEC) to throw the little guys a bone since that is not where their real money is being made.

Tue, 09/22/2009 - 11:31 | 76356 monkeyshine
monkeyshine's picture

Yes, SEC has proven to be incompetent.  But that doesn't make Cramer altruistic or even right. In my opinion Cramer correctly recognized the SEC as chasing its tail, and so mocks it. It's reverse psychology.  There is no there there, but the more he wails about it the more the SEC thinks it is on to something and devoted more resources to investingating the straw man.  Meanwhile the theiving continues.

Tue, 09/22/2009 - 10:30 | 76280 justrichard
justrichard's picture

cuff links would make me wanna puke a little less.  maybe he likes flash because he identifies with the iron workers from "Flashdance"?

Tue, 09/22/2009 - 11:00 | 76315 Bruce Krasting
Bruce Krasting's picture

What do you expect? He is ex GS. That is like being in the Skull and Bones club at Yale. You are blood forever.

Cramer is a shill for who ever pays him. That he talks about this just confirms that. He is "pro" small investors. BS.

Tue, 09/22/2009 - 11:06 | 76325 KidDynamite
KidDynamite's picture

I can't remember the last time I agreed with Cramer, but he's right on this issue.  All of the minions hating flash trading are caught up in the pitchfork mentality and simply don't understand what it is.  It really is a non-issue. (if you actually want to understand, you can read this: "http://fridayinvegas.blogspot.com/2009/09/you-really-shouldnt-care-so-mu...")

TD - congrats, though, on playing a large part in getting the SEC fired up about flash trading, and getting them to ignore the things you'd really like them to focus on, like Perot frontrunning.  Every time someone defends flash trading, they get assailed as a mole for Goldman Sachs.  Of course, only a tiny % of your readers understands that the NYSE would probably be the biggest beneficiary of a ban on flash trading - do you work for the NYSE ?? ;-)

Tue, 09/22/2009 - 12:57 | 76370 JohnKing
JohnKing's picture

LOL

Flash trading is front running, although harder to detect because of speed and small order sizes and penny spreads it is still front running.

I can make money all day long with the right data feed:

SELECT stockSymbol, AIG(price)
FROM (SELECT * FROM StockTick WHERE feedName = 'my_customer_orders' )
DO something to screw customer

or

SELECT stockSymbol, AIG(price)
FROM (SELECT * FROM StockTick WHERE feedName = 'GS_SLP_Feed' )
DO something to screw all other market participants

All I'm doing there is front running customer orders or data not available to other market participants. The technology is the enabler but not the cause of front running, the criminals simply have a tool that is defended through technical obfuscation (it's too complex for the lesser minds to understand, it's technical innovation, blah blah, liquidity, blah blah). The crime is being committed in milliseconds but it is still a crime.

To restore fair market or a level playing field, all market participants need to have access to the same information (at the same time).

The SEC (or the pitchfork crowd) needs to put in place "feed police", establishing one-feed-for-all:

SELECT stockSymbol, AIG(price)
FROM (SELECT * FROM StockTick WHERE feedName = 'common_feed' )

I won't hold my breathe waiting for the SEC, the pitchfork crowd will probably get there first.

Tue, 09/22/2009 - 13:13 | 76437 Anonymous
Anonymous's picture

JohnKing does his flash trading in poorly written SQL. Your sub-select should be in a where clause.

Tue, 09/22/2009 - 13:27 | 76453 JohnKing
JohnKing's picture

EPL

Fri, 09/25/2009 - 00:41 | 79232 monkeyshine
monkeyshine's picture

Common? Ha!  The market making desks need exemptions!  They can't create liquidity and they can't run efficient markets unless they can sell shares they don't own, front run market making orders over retail orders, rent exemption shares to hedge funds through the options market etc etc. 

All in the name of an "orderly market" that sees, say, RIMM fall $10 in an instant, sees DNDN jump $20 in an instant (and fall $15 and rise $15 in 75 seconds).  An orderly market that sees AMZN and AAPL and RIMM and GOOG go up and down 2-3-4% every day on .1-.2-.3% of the float trading.  The DJIA went from up 79 to down 80 in 30 minutes yesteday. That's an orderly market, I guess. 

Tue, 09/22/2009 - 11:47 | 76376 Anonymous
Anonymous's picture

I read it that he is just saying it's "Much Ado about nothing"... but ok..

the world revolves around flash trading.

just cause it's the MEME dujour around here.

Tue, 09/22/2009 - 13:19 | 76445 MsCreant
MsCreant's picture

I can't out decide a computer that has data miliseconds before I do. Out decide includes:

1. Numbers of decisions, I don't get to press the buy/sell button that fast over and over again.

2. Making profitable decisions, the computer is programed with sucessful models that take into consideration many if/then conditions that I cannot hold in my head all at once.

3. Making profitable decisions, the computer knows what the offer is before me.

Out of all of these, #3 is overtly illegal. If I were a market participant, 1. and 2. Make me edgy too.

F@(k the market.

I want to get therapy for all of you addicts. You need a halfway house. Throwing your hard earned $ into this mess is:

1. Self abusive.

2. You are supporting the system.

Here is a thought: STOP TRADING.

I know you won't. Just a thought.

Tue, 09/22/2009 - 14:22 | 76529 troublesum
troublesum's picture

I pulled my money out and paid off my car... the only gaurenteed way to get a 8% return on my money. :)

Tue, 09/22/2009 - 23:21 | 77013 MsCreant
MsCreant's picture

I'd say "You go" troublesum but you already left!

Yeah!!!

Starve the beast.

Tue, 09/22/2009 - 12:55 | 76412 Anonymous
Anonymous's picture

Like banksters, stock brokers and politicians, the way you can tell Cramer is lying is that his lips are moving.

Tue, 09/22/2009 - 14:44 | 76551 Anonymous
Anonymous's picture

It appears Cramer has the same mindset of many Financial institution CEOs these days: The market meltdown wasn't really our fault. Those bad short sellers created this crisis. The rules were slanted in their favor. We might have taken a bit too much risk, but everyone else was doing the same thing.

Tue, 09/22/2009 - 15:20 | 76589 Anonymous
Anonymous's picture

Shut up Cramer. He's such a douche. Does anyone
even watch him?

Tue, 09/22/2009 - 16:13 | 76679 Careless Whisper
Careless Whisper's picture

Cramer said Sears, run by "Fast Eddie" Lambert, a GS alum, was the "next Berkshire Hathaway", Sears was $150 then. Oops.

http://www.bloggingstocks.com/2007/02/09/is-sears-the-next-berkshire-hathaway/

Then there's his famous "buy, buy, buy" on Wachovia at $15, just a few weeks before its collapse. Of course Wachovia was also run by a GS alum, Robert Steele.

http://www.youtube.com/watch?v=5k5F6O2zB_Y

Cramer's recent comments on Flash Trades is perhaps just a misguided effort to help his buds on the Street.

He has a few hundred thousand viewers so I wouldn't underestimate him.

The real Cramer was exposed a while ago by one of his former traders at his hedge fund:

http://www.amazon.com/Trading-Enemy-Seduction-Betrayal-Cramers/dp/0060086513

 

Tue, 09/22/2009 - 17:28 | 76758 Dr Hackenbush
Dr Hackenbush's picture

His squeaky voice makes it obvious that Cramer is the 'Butt Boy' for Mr Big! 

Tue, 09/22/2009 - 18:09 | 76800 Anonymous
Anonymous's picture

The government-crony gameshow host in "The Running Man" had more credibility than Cramer does in this clip. Are we already a banana republic?

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