LEH Has One Play

It is time. It is time for Lehman (LEH - commentary - Cramer's Take) to put up its defense. Not the talking one. But the one it used in 1998 when everyone thought it was a goner. It needs to go in and start buying its stock.

Think about it. If Lehman is right and self-styled nemesis David Einhorn from Greenlight Capital is wrong about the firm needing capital, this has to be one of the greatest buying opportunities Richard Fuld, the CEO, has ever had. Not since 1998, when he bid me $31 for a million shares in order to take advantage of the endless raids that his firm had because of alleged problems in London, has Richard Fuld had such a great chance to make a statement.

But here's the flip side. Without such a vow and show of not just confidence but opportunity, the market is going to determine that Greenlight is right and the spiral will be endless. We know what happens when a company needs capital. You get a Washington Mutual (WM - commentary - Cramer's Take), a Nat City (NCC - commentary - Cramer's Take), an AIG (AIG - commentary - Cramer's Take) or worse, a Bear (BSC - commentary - Cramer's Take).

We all know this. We also know that these companies are surprisingly easy to break in a world where money is fungible.

Still, there is worth here. Lots of worth. I know that the earnings power has been impaired, but I do not believe the capitalization is impaired. I don't know if that is the case unless I see a buyback. It is what makes Goldman Sachs (GS - commentary - Cramer's Take) different.

Why now? Because the stock is clearly down artificially if Einhorn's wrong. A panic valuation.

The silence of the non-buys is speaking every bit as loudly as Einhorn against this great institution.

Random musings: Speaking of silence, look at SunTrust Banks (STI - commentary - Cramer's Take). Remember when that was a well-run institution? Joins Fifth Third (FITB - commentary - Cramer's Take) as still one more hole in the ground like KeyCorp (KEY - commentary - Cramer's Take). I can't believe how good these stocks used to be. I guess STI will have to sell its Coke (KO - commentary - Cramer's Take) stake. At least they won't do what Bank of America (BAC - commentary - Cramer's Take) did -- buy more of its Chinese bank stake. Sheesh! ... Lots of chatter about the 10-year. I want the thing lower. We need some slope here! ... I am blown away by the inability of the AIG/Wachovia (WB - commentary - Cramer's Take)/SunTrust/Ambac (ABK - commentary - Cramer's Take) collective woe to hurt this market. This is a shrug-off of amazing proportion and must be noted if only because of history. This financial cohort is being smacked down to a size that would have been unthinkable, and the acceptance of the decline is remarkable.

At the time of publication, Cramer was long Goldman Sachs.

ALL JIM CRAMER BLOG ENTRIES | POST A COMMENT | READ COMMENTS  

---

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)," click here. Click here to order "Mad Money: Watch TV, Get Rich," click here to order "Real Money: Sane Investing in an Insane World," click here to get "You Got Screwed!" and click here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by clicking here.

TheStreet.com has a revenue-sharing relationship with Amazon.com under which it receives a portion of the revenue from Amazon.com purchases by customers directed there from TheStreet.com.