Cramer: Buffett Leaves the Bruin Camp

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The billion dollar hypocrite is no more. Long live

Warren Buffett

, the flexible investor.

Last year I

blasted Buffett for simultaneously labeling the market as ludicrously expensive and at the same time holding on to arguably the richest stocks in the market,

Coke

,

Disney

and

McDonald's

. Either sell the high-priced stocks or stop lecturing us about overvaluations, I urged. Seemed like common sense to me.

The wrath was swift. Even though we only had about 1,000 paid subscribers at the time -- our ranks have swelled twelve fold in the interim -- my mailbox was filled with hate letters worthy of a zesty war criminal. People who had never heard of us were taking subscriptions so they could cancel them. Many said that I had no right to even be writing on Buffett, let alone criticizing him. If you could send a letter bomb via email, I would have had to call the e-bomb squad a dozen times.

This year, what happens? Buffett says that given the decline in interest rates, stocks make more sense. "There is no reason to think of stocks as overvalued," he writes. Of the troika that seemed expensive to me, he's dumped the one that made the least sense on 1998 earnings, McDonald's, although I may have to buy it today if the market really clocks it. Indeed, given where long rates have gone -- and where they may be going, judging by his zero bond bet -- these stocks make plenty of sense to him and to me.

The lesson for the Bruins from Buffett's letter must be extremely painful. The Bruins, you know the True Powder Blue Bears, loved having the oracle from Omaha on the team, crowing about overvaluations. You see, the Bruins like to think that when stocks go up, they are expensive per se. They hate to ever admit that this time something has changed, that with bond yields headed to historic lows, stocks become relatively cheaper. The Bruins only examine the question in an absolute way:

Dow 8600

is ridiculous because it is so high. They had thought that they could never get Buffett out of their den unless stocks fell appreciably. In fact, some of you emailed me last night in complete denial that Buffett said positive things about the market. That attitude ain't gonna make you nuthin.'

But Buffett is a great long-term investor. He understands the long-term value of equities versus bonds better than anybody. He is the virtual laboratory of stocks versus bonds.

And he likes what he sees.

Looks like

Michigan

may have lost to the blue bears this weekend, but

Nebraska

has sure picked up the slack.

James J. Cramer is manager of a hedge fund and co-chairman of TheStreet.com. At time of publication his fund is short McDonald's. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Mr. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he welcomes your feedback, emailed to

Jjc@thestreet.com.