Journalist, TV star and former hedge fund manager Jim Cramer tells Brunswick about his view of the role media plays in business deals
As an undergraduate at harvard, jim Cramer became President and Editor-in-Chief of the student newspaper, the Harvard Crimson. But out of college, after taking a series of jobs as a reporter, the future millionaire investor, entrepreneur and TV star was confronted with a problem common to the trade: not enough money. At one point, while working for the Los Angeles Herald-Examiner, he was forced to live in his car.
“Oh, I was really poor!” he recalls in a recent conversation with the Brunswick Review. “I always wanted to be a writer. But that wasn’t lucrative enough for me to be able to live in New York. So I did the hedge fund thing.”
First though, he went back to Harvard to study law. During that period, he made significant and profitable investments for Martin Peretz, a friend and owner of The New Republic. That propelled him into the “hedge fund thing,” first as a stockbroker with Goldman Sachs Private Wealth Management and later with his own firm, Cramer, Berkowitz and Co.
Building on his success, he founded pioneering online-only outlet TheStreet in 1996, an early business reporting website. A major player in the late ’90s, TheStreet has struggled with profitability and has undergone a series of restructurings since the dot-com bubble burst in 2001. Yet it remains a milestone in the evolution of journalism and Cramer continues to be an important contributor.
“I founded TheStreet because I felt like the world was changing and we were going to find ourselves outmoded by the internet,” he says. “So I saw that coming, which was good. But did I really capitalize off of it? Well – we’re still trying. We’re going to get it right!”
Cramer also became a frequent commentator on CNBC and his own show, “Mad Money,” has aired continuously since 2005. Its characteristic mix of thoughtful interviews and 100-mile-an-hour analyses of stocks in the news – with plenty of graphics and sound effects – has earned it an enduring niche in American culture.
At both TheStreet and CNBC, where he is now co-anchor of the daily “Squawk on the Street,” Cramer’s goal is to educate people about investing, the workings of the market and the companies behind the stocks. As a hedge fund manager and journalist, he has had deep exposure to the top minds in business and how they interact with media and investors.
Cramer retired from his hedge fund business in 2001 to focus on journalism and his charitable fund Action Alerts Plus. We spoke to him about his career, about M&A deals, and his views on the role of media in business. Too often, he says, companies are reluctant to explain themselves, to state the facts and let the public decide. He has a message for CEOs: “Come on TV and make your case!”
What do you think the media gets right or wrong in its reporting on deals and M&A?
It’s a remarkable beat because there are some people who can do it really well and a lot of people who just don’t have it right. And when you don’t have it right, you can really cause a lot of damage to the stock market. You can write that someone’s about to make a takeover bid – but what if it’s not true? And boom! A lot of people pile into a story and the story’s dead wrong.
I work a lot with David Faber [of CNBC], and David is the best M&A reporter in the country. It takes a tremendous amount of responsibility to be an M&A reporter and a tremendous skill set. You have to be skeptical. You have to recognize that there are a lot of people who want you to write a story that is not real. David knows all those things are happening. But most people who cover M&A do not know.