The host of CNBC’s Mad Money has often been called out on social media for advising people to invest in assets that become unprofitable or vice versa.
His latest example is the notorious Silicon Valley Bank, which became the victim of a bank run and finally collapsed on Friday.
Cramer said buy SVB shares
“This company is a commercial bank with a deposit base that Wall Street is wrongly concerned about,” Cramer explained in his show since February 8. He added that the bank was “less reliant on private equity and VC deals” before adding that shares “remain cheap” despite being up 40% YTD at the time.
Fast-forward to a month later, on March 8, SVN’s troubles became known to the mass public when the bank announced that it had sold a large chunk of the loss-making securities and plans to sell more than $2 billion worth of new shares. to fix your balance. sheet.
The company’s shares plummeted soon after, and the announcement sparked panic among depositors who rushed to withdraw their funds from the bank.
The stocks in question, which Cramer touted as cheap a month ago, took another hit on Thursday and were finally halted on Friday. Regulators had to increase as the Federal Deposit Insurance Corporation took over the bank during the trading day. The independent federal agency normally waits for the end of business hours to do so.
“SVB’s condition deteriorated so quickly that he couldn’t last just five more hours. That’s because its depositors were withdrawing their money so quickly that the bank became insolvent, and an intraday shutdown was inevitable due to a classic bank run.” saying Better Markets CEO Dennis M. Kelleher.
The demise of the bank hurt the crypto industry as it turned out that at least one giant, Circle, has a substantial amount of its USDC reserves in it. Consequently, the second largest stablecoin lost its peg to the dollar and saw more than $8 billion of its market capitalization evaporate.
Previous Cramer strikes
Though he’s been on the air for many years, Cramer has his fair share of controversial investor advice that has headed in the opposite direction. He has been particularly questionable when it comes to his views on the cryptocurrency industry.
His previous recommendations range from buying BTC and ETH to selling both assets to staying away from anything crypto. This prompted certain investors to open reverse trades, while others believe the market will head in the opposite direction of what he said.
However, some people on Twitter criticized the Mad Money host for causing losses to certain investors.
It was funny at first that Jim Cramer was always wrong.
It is now extremely sad how many people and families he has destroyed by always being wrong.
The guy needs to be taken off the air forever.— Appearance (@Appa4two) March 10, 2023
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