Suche
Mein Konto
Jim Cramer advised people to buy Silicon Valley Bank stock a month before its collapse
The host of CNBC's Mad Money has often been grilled on social media for advising people to invest in assets that become unprofitable or vice versa. His most recent example is the infamous Silicon Valley Bank, which fell victim to a bank run and ultimately collapsed on Friday. Cramer said buy SVB stock "This company is a commercial bank with a deposit base that has falsely alarmed Wall Street," Cramer said in his Feb. 8 broadcast. He added that the bank was "less dependent on private equity and venture capital offerings" before adding that the stock "is still cheap" despite being at...
Jim Cramer advised people to buy Silicon Valley Bank stock a month before its collapse
The host of CNBC's Mad Money has often been grilled on social media for advising people to invest in assets that become unprofitable or vice versa.
His most recent example is the infamous Silicon Valley Bank, which fell victim to a bank run and ultimately collapsed on Friday.
Cramer said buy SVB stock
“This company is a commercial bank with a deposit base that has falsely alarmed Wall Street,” Cramer said on his Feb. 8 broadcast. He added that the bank was "less reliant on private equity and venture capital offerings" before adding that the stock "is still cheap" despite being up 40% YTD at this point.
A month later, on March 8, SVN's problems became known to the general public when the bank announced that it had sold a large portion of securities at a loss and planned to sell over $2 billion in new shares to address its balance sheet.
The company's shares plunged shortly afterward, and the announcement caused panic among depositors who rushed to withdraw their money from the bank.
The stocks in question, which Cramer touted as cheap a month ago, took another hit on Thursday and were ultimately halted on Friday. Regulators had to take action when the Federal Deposit Insurance Corporation took over the bank during the trading day. The independent federal authority usually waits for the end of trading hours to do this.
"SVB's condition deteriorated so quickly that it couldn't last five more hours. This is because depositors were withdrawing their money so quickly that the bank was insolvent and an intraday closure due to a classic bank run was inevitable," said Dennis M. Kelleher, CEO of Better Markets.
The bank's demise hurt the crypto industry as it emerged that at least one giant - Circle - was holding a significant portion of its USDC reserves in it. As a result, the second largest stablecoin lost its dollar parity and saw over $8 billion of its market cap evaporate.
Cramer's previous beatings
Despite being on the air for many years, Cramer has his fair share of controversial investor advice that goes in the opposite direction. He has been particularly questionable when it comes to his views on the cryptocurrency industry.
His previous recommendations have ranged from buying BTC and ETH to selling both assets to avoiding crypto. This led certain investors to open reverse trades, while others believe the market will go in the opposite direction of what he said.
Still, some people on Twitter grilled the Mad Money host for inflicting losses on certain investors.
At first it was funny that Jim Cramer was always wrong.
Now it's extremely sad how many people and families he destroyed because he was always wrong.
This guy needs to be taken off the air for good.
— Appatunity (@Appa4two) March 10, 2023
.