Criticism of Cramer has deep roots

Alice Gomstyn of ABC News reports that the recent criticism of CNBC “Mad Money” host Jim Cramer in relation to what he said or didn’t say about Bear Stearns has exposed deeper concerns.

Gomstyn wrote, “Snark aside, concerns raised by industry veterans and investment advisors take the long view of Cramer and his impact on small investors.

“‘He kind of puts himself forward as the champion of retail investors, but had they listened to him on the [Bear Stearns] call, they would have lost a lot of money,’ said Roger Ehrenberg, the managing partner of IA Capital Partners in New York. ‘He empowers people to feel confident about buying and selling individual stocks, when in fact most people are ill-qualified to invest in that manner.’

“Ehrenberg and others say that Cramer’s show may encourage small investors to make frequent trades when it is really in their interest to invest in mutual funds and hold them for long periods of time.”

Read more here.