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Jim Cramer’s Mad Money – Lightning Round Legit?

If you’ve seen Mad Money, you know he has a lightning round where he just takes a ton of phone calls where it’s basically a free for all where he gives his buy/hold/sell advice (with brief reasoning and alternatives if he hates the stock) on the ticker. How is he doing it? They screen the calls of course so his screen probably pops up with some summary information but is he getting some “extra” help on those screens? It can’t be possible that he comes up with advice on fly does it? Let’s think about it a little bit…

I think he’s legit and here are the reasons why:
1) Sometimes he blows people off with basically no info (“I can’t say anything bad about…”). So you figure he doesn’t know about Company XYZ, he’ll figure out some clever and witty phrase and blow you off.
2) A lot of the advice he does give on some obscure stock is sector advice. He’s hot on energy but not on coal. Bring some obscure coal company, as someone did tonight, and he’ll tell you that coal sucks and sell the stock.
3) Always advises profit-taking, “ringing the register” if you will, regardless of the company. A woman mentioned a stock that had gained like 24% and he told her to take the cash! Who cares what the company does… take the cash!
4) When he does know the company, he gives legit advice.
5) He does pause from time to time, maybe a fraction of a second, and “appears” to think. I don’t see him faking thinking… seriously… why would he?
6) He talks quickly and does try to get as many calls as possible. If he was BSing, he’d probably waffle a little, kill some time, etc.

Remember, like every other pundit and every other show about stocks, you have to do your homework. So far, Cramer looks legit and I enjoy watching his show. It’s entertainment after all right?

Anyone ever call in and get on the air? I think the probability is low you called and happen to read my blog but if you did, please please please leave a comment! 🙂

Update: The other day, Jim Cramer commented on a company before a caller mentioned the company name. (5/4/05)