@bwcbwc: "You're assuming the market is somewhere near the bottom."

No I'm not. I'm assuming that eventually someday the market will exceed the point that it's at right now and you'll be able to eventually trim your losses some more or come out ahead again. It has nothing to do with whether it's actually at the bottom now or not, it's about not taking a guaranteed loss.

I know! The dow is almost back to 14000! Thanks Washington!!!

Unless you have money to throw away and/or are day trader you should never invest in individual stocks!

Buy low, sell high and go long.

Jim Cramer = Mr. Market. Ben Graham fans know what I mean.

@citking: But that's not what Cramer is saying. He's saying "get the fuck out". He's a paid mouthpiece for the big traders anyway, so he'll tell the mom and pop investors to get out and spend the money on cars, houses, big TVs or whatever it takes to get the economy rousing again. That way, he and his big city clients will experience a rousing stock erection thanks to the newly-available and devalued stocks they bought when the moms and pops sold. Then Cramer and his ilk will scream "BUY BUY BUY" again and the peons will ramp up those prices even further.

Just follow the money, then you'll see where the real action is.

@Bahnburner: Yeah, I'd rather listen to Warren Buffet any day of the week. He always calls it.

I like Jim, he's very smart and entertaining. But he can't make his show interesting by giving long and boring technical advice. He must keep his show quick and pithy.

exactly. this is the time when dollar-cost averaging should really boost the average 401k.

Nobody real listens to this clown.

Keep investing in the 401(k) to at least get the company match. Unless they force you to put all your money in company stock or some similarly risky option. As mentioned earlier, put your investments in the most conservative possible options: T-Bonds, Euro Bonds, maybe Munis and some index funds.

There's not really any evidence to support that yet. My optimistic projection is that the market will bottom out around the election, since the results of that will remove a lot of uncertainty about the next 4 years. My pessimistic projection is that whoever gets elected sends mixed and bad signals to the markets during the transition period, and things go to hell in a bucket. The key is to get banks lending again, and right now the biggest of them can't because they're already exceeding their required captitalization ratios.

Still, it's all I have.

And as for the people who "lost it all" on Bear Stearns, that's there own fault. It sounds very harsh, but they invested thier own money and lost it. Jim Cramer didn't invest thier money, he at very best gave them advice. It's stupid anyway to have "it all" in a certain stock, you must diversify your portfolio and also have a safety net, but that's beside my point. I watch Jim's show every now and then, and know that he's wrong sometimes and right sometimes, but as long as there is a discla9imer before his (or any other investment or money management show, for that matter) show, I'm not taking his word as gospel.

However, one has to look at what his motive is for such a move. Very simply, as the stock market drops more, it is a perfect time for him and other big investors to step in buy cheap. Do you think Buffet is quivering in his boots now? No, he's rejoicing.

The economy works in a cyclical fashion. If you have a sound investment strategy, you already knew this, and when the core audience of this site retires in 30+ years, the poor market of 2008 will just be another bullet point in the economic history books. The market will recover, and those holding steady will benefit on the upswing.

I wonder why people listen to Jim Cramer at all.

@iamlost26: It depends on the type of 401k. A regular 401k is tax-deferred. All the money you put in is pre-tax money, taken out of your paycheck before taxes are withheld. The initial investments and the growth are only taxed when you take the money out many years down the road.

There are now Roth 401ks, which work a lot like Roth IRAs. The contributions come out of your taxed salary, but all the growth is completely tax-free.

Yep, that's what I've always been told. Buy high and sell low. Sell now and you've locked in your loses.

May I have my grain of salt now for Mr. Cramer's recommendations?

Perhaps you missed his infamous "meltdown" over a year ago when he exclaimed (over and over again) that the fed had no clue how bad the situation was.

I plan on staying in for 5 years and I may as well keep buying, since things are at and approaching record lows within this period of time - and will go back up again, some day.... Unless history fails us and capitalism dies, then we have other problems.

@alexawesome:

I understand what you're trying to say, but I'm going to have to stick with what I've already said. He's a little late to the tea party. Stocks have dropped what, 4000 points over the last year or so? Anyone that still has their money tied up in that at this point is better off waiting it out and finding an alternative method to make their ends meet if they're in that desperate of a situation. No one's going to get anywhere by selling for a loss and the more frantic selling that goes on, the more panic that goes on, the more the value is going to drop.

I like watching his show because he has funny sound effects and sometimes he gets all wound up that it looks like his head is going to assplode.

Other than the entertainment factor his show offers no value at all.

Truer words never spoken. He's about as accurate as a blind William Tell.

As the Cramer's recommendation, it's valid IFF you are going to lose so much position by staying in that it's worth cutting your losses. So the question is: how much farther have we to fall?

I'm hoping that in another week or so, the worst of the bleeding will be over.

And I am sooooo glad that it really wasn't what you typed.

Keep putting money in, especially if your company matches or in any way gives you free money. Don't have it in the aggressive funds maybe be more conservative. But ride it out and in 20 or 30 years (if you have that long before you need it) you won't even be able to remember how much you lost. Maybe if you lose 100k, but that is a story for the grandkids.

@captainpicard :

Would you wait until that house you wanted to buy shot up another 25%? If you have the means, now is the time to be buying. Now is the time everything is cheap. If the stock market completeley disintergrates, well, society is over.

The title of this post is incredibly misleading. All he's doing is repeating some of that sound financial advice that has been serving those who heed it very well.

Of course, his manner (and posts like this with incredible titles) can only lead to further panic.

I mean, come on! It was FUCKING DOUBLE DARE!!!

The issue is if you're going to need some or all of that money in the next five years. If you can at all avoid touching it, DO - the market will inevitably bounce back, and when it does, you stand to make a chunk of money if you stay in now.

Finally, I don't know if any of the people here are more than armchair analysts. As such, it's in your best interest to talk to an adviser. Since you have a 401k plan, it's probably managed by a company like Vanguard, which has lots of information and helpful people around to give you sound financial advice. In layman's terms. So that you can feel secure about the choices that you're making, become more informed about where your money is going, and make educated decisions about what to do with it right now.

Don't do anything rash because you've bought into hysteria. That road always leads to remorse.

Sweet Jesus,who is still listening to this guy ? I mean ,really ? If you had followed his non stop buy-sell , buy -sell nonsense over the last 16 months, you'd have gotten KILLED. I don't know which way the market is going from here,but I do know that he doesn't know,either.There are good companies out there that are on clearance right now and if you tune out the steady hum of bullshit from people like Cramer,you can pick them up at an attractive price ,hold them and make lots o' cash. But if you tune in to these hysterical carnival barkers and panic, THE SAME EXACT PEOPLE that just picked your pocket for 700 billion skins will take another bite out of your ass. Please, folks, don't be sheep. Invest,don't gamble. Damn, this isn't hard...

The vast majority of consumers have no business being in individual stocks anyway. And even in a good market, any money needed within five years should be invested more conservatively and definitely has no business being in individual stocks.

Remember the basics... your time horizon, your risk tolerance, index funds/ETFs only/mostly, diversification, and dollar-cost averaging.

His point is absolutely bang on - if, in this lousy economy, it's likely you're going to need to pull out and sell stock at some point in the next five years (due to job loss, increased food prices, etc), do it NOW, not tomorrow - you're likely to get a better return on your investment today than next year. In other words, you're going to get more money now than you would later on when you need it more. Does that make sense?

If you can afford to hold out, then of COURSE that's going to mean better long term profits for you. But when it comes to having to scrimp and save to put food on the table, stocks are a joke. He's making this statement to amateur investors who will likely be selling stock in the next five years anyway, due to the issues he mentions.

Buy high, sell low. Great going Cramer.

Typical stock market "expert". If he actually knew anything, he'd make this recommendation roughly 12 months ago.

The two instances that he is bashed on most were both mentioned in this thread already. His comment on bear sterns and his interview with Wachovia's CEO. The bear sterns comment was taken completely out of context, what he was saying was people who actually had money in the firm (aka NOT STOCK, ACTUAL INVESTMENT IN THE FIRM) would be ok (and they were made whole). It was pretty obvious to me based on the question (since it was an emailed question) and his response that this is what he was talking about (the caller later called in and said that in fact he was NOT asking about the common stock). The only thing i fault him for on this front is that he did not explicitly say that during the response but he paid dearly for that mistake. Onto the people having issues with the Wachovia CEO interview. That interview i thought was pretty heavy hitting for a television interview with a CEO. even though he never recommended the stock during the interview (after the company failed) he was the first to admit he had been "taken in" and placed the CEO on his wall of shame (which he has since removed because of the pending deal with Wells Fargo).

In closing, yes this guy does make some bad calls, but the ones he constantly get's beat on about seem to be people who just want to bash on him. The only advice people should take from the show (and the stuff he talks about constantly) is the "homework" aspect. Actually doing research on stocks that you own (he says 1 hour a week per stock) and making your judgment based on that (even on the stocks he recommends he says do this).

The only time my brain hurts is when they have multiple experts saying multiple things. I've developed a system, though: go with the prettiest one. If they're all fugly, go with the most excited one. Failing that, change the channel to Nickelodeon.

@Aesteval: Don't misunderstand his intent. I believe he means speculative investments which are much more risky. Keep your money safe in slow growing industry standard investments such as P&G, Wal-mart (yeah I know, but hey...they will still be around even in a depression), McDonalds, Gold, and Ford. They are huge companies/ industries that have the resources to survive and continue to grow and are "depression survivors". Ford for instance is at a 20yr low, so I am acutally BUYING Ford and McD's like mad with money that I can afford to lose/ not use.

Lets be COMPLETELY clear here, Bear Stearns and other companies COMPLETELY LIED TO INVESTORS. What they where telling investors and what they themselves knew were completely two different things, and the likelihood Cramer knew that Stearns was cooking the books to show profit where there was none is very low.

While you can certainly fault Cramer for many things, you cant fault him on that one.

@captainpicard: Oh god, yes. The basic investment strategy is to buy low, sell high. It's low right now. (and if it goes lower, buy more).

If the economy collapses and you lose everything, money will be the least of your problems.

For the rest who try to invest for the long term, make rational picks based upon research, not what screaming fools on TV say or what helicopter flyin' fools say you should do (which is to trade, trade, trade because they make money on commissions), this is just part of the deal.

People need to listen to the words of Benjamin Graham or Peter Lynch, not this Jim Cramer idiot.

@pezhore: Not to mention Wachovia, who one of his best friends was the CEO.

The Euro is dropping, Oil prices are way down, commodities are dropping like flies. This is a great time for consumers.

Moron! Now that he is jumping off the bandwagon things must be bad. Here's how the fallout is going to play out for "main street" according to this article ( [www.savingtoinvest.com] ): Banks worldwide, stung by $588 billion in write-downs related to toxic assets -- especially mortgage-related securities -- will further reduce the flow of credit, strangling growth. That will push house prices lower, forcing additional losses and making banks even more reluctant to lend. As the credit crisis worsens, businesses will find it almost impossible to raise prices. They will then be forced to close or start laying off employees, which will in turn reduce consumer demand and thus create a vicious downward economic spiral.

My advice : Cash is king and perhaps it is time to invest in a cheap mattress for your moolah's.

@captainpicard: I think regardless of how the market handles, it's best to keep your 401K investments since you automatically double your money. You may want to change where your investment is going. Unless some bank offers you a 100% investment return, I'd continue to fund it at your max.

My question is, should I still be putting money into my 401K? I put in 6%, which my company then matches 100%, then at the end of the year we get a 5% of our base salary profit sharing bonus in my 401K. Should I still be putting 6% of my income into 401K?