When 'Buy What You Know' Doesn't Pay

2. Six Flags(SIX Quote - Cramer on SIX - Stock Picks): What can be more fun than a day with the family at the amusement park? Well, maybe a day at the ballpark, but you get my point. You have to be a real misanthrope to hate amusement parks.

Disney(DIS Quote - Cramer on DIS - Stock Picks) knows how to build and manage an amusement park. Six Flags, on the other hand, has managed to deliver declining returns to shareholders. In fact, a weekly chart of Six Flags looks like a roller-coaster ride: a big climb, a rapid fall, some ups and downs, and then a return to terra firma. Six Flags has been under new management for several quarters now and, frankly, it has continued the failures of its predecessors.

The company managed to bungle the Great Escape in the Lake George, N.Y., region. The geniuses at Six Flags repaved the Great Escape parking lot this year (it does look good), but initiated a $10-per-car parking fee. There is a Yiddish terms to describe this decision: chutzpah (gall, audacity, nerve). So they spent lots of cash (heavily borrowed), charged to park, and attendance declined. Spend your hard-earned cash for a day at Six Flags, but not for a single share of stock.

3. Vonage(VG Quote - Cramer on VG - Stock Picks): Get rid of land lines, give your local telephone company the Bronx cheer and use the Internet for telephone calls. Voice- over-Internet protocol (VoIP) sounds great, and many people are switching. My sister-in-law has gone VoIP and is satisfied; I haven't switched, but would consider it someday. I've heard pros and cons in the VoIP debate, but I have to say that as a product and technology, it is a great concept.

Vonage seemed to be promoting itself for years. (I call it the longest road show ever.) It was also the most bungled IPO since the Wilt Chamberlain restaurant debacle in the early 1990s. Since the company went public, the stock has gone straight down, and it's not going to be earning money anytime soon. It fact, it could be TiVo-like. Add to that the fact that the IPO left the company with lawsuits and regulatory issues. So what's to like about this company as an investment? If you have or plan to use VoIP, be careful and don't swap your old AT&T (T Quote - Cramer on T - Stock Picks) stock for Vonage in the process.