Jim Cramer Goldman Sachs (GS) Shill or Critic?

I (Kirk Lindstrom) posted this comment on my facebook "Investing for the Long Term" discussion group today.  I think Jas would agree with my summary.

Cramer was recommending GS all the way up but he seems to have abandoned recommending it after he and CNBC regulars were accused on TV by a guest of being shills for GS. He CLAIMS he saw what most think of GS when he visited a 7th grade class of kids who told him the stock market is rigged against the little guy so he's now recommending Citi over GS... at least on the segment I saw with Erin yesterday around lunch time here in CA.

The timing is suspect that he gives up on GZ a day after being called a shill and Erin kicking the guest off for being "rude."

I've stated in my newsletter and (free) writing since the 1990s that of course it is rigged but the way to make money is figure out how the insiders make money and follow along. The options scam is simply amazing that it still goes on where the insiders can get rich letting the stock price go up and down... but nowhere over decades while they give themselves cheap shares or options when down then sell when they have a gain... often more money is spent on this than on dividends... and some companies don't even pretend to create value with dividends.

Cramer says look for dividend payers since that is the way to make sure there is no monkey business. I think he's on crack or an idiot if he believes that since many stocks like Pfizer and his favorite telecoms use debt to pay dividends... but he's right for tech stocks with zero debt that pay dividends...
check out the debt on VZ

• http://finance.yahoo.com/q/ks?s=VZ+Key+Statistics

it is $62.26B

It is a significant percentage of the $82.22B market cap! It would take SIGNIFICANT dilution to issue enough shares at the current price to eliminate the debt...

Now tell me how a 6.4% dividend is anything buy a Madoff return of capital with the only difference is Madoff didn't get loans while VZ builds infrastructure that could be obsolete if Google builds a free network....

The big difference between Jas and I is Jas plays the stocks from the short side while I think it is safer to play from the long side because "the system" needs people to think they have a chance for it to work. This means stocks need to go up over the long term or the tricks by the insiders won't work.  Cronie capitalism won't work.   

best regards
Kirk Lindstrom
http://kirklindstrom.com/
Blog: http://kirklindstrom.blogspot.com
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