Could this friends and family stock issue be more misunderstood? An incredible number of you e-mailed me and said that my position --
that F&F must go -- would hurt the little guy.
The little guy? Oh, please! That is just plain ridiculous. The little guy would benefit much more from a lottery that allowed him in than from friends and family. Funny thing, but the people who get this stock tend to be wealthy people and they give the stock to other wealthy people or to people who would help the business.
Another group of critics said that F&F stock rewards some people who took risks in doing business with you. Hold it, that's just business. And the rewards belong to the companies the people work for, not the people themselves, especially if the companies are public.
When it comes to matters like this, I always default to a simple standard: what would it look like if you disclosed the recipients. Would it be embarrassing? I think in most cases it would be. So at a minimum, if we can't ban F&F we should at least demand that the handout/kickback be disclosed so we can find out what kinds of deals may have been made to further a company's growth. That would be a simple but positive change.
Speaking of F&F,
's Melanie Warner is not the only one who deserves credit for bringing this issue to light. Back in October of last year, Scott Thurm of
The Wall Street Journal
penned a very hard-hitting piece looking at this issue, breaking a ton of ground on the subject. I regret that I didn't remember that piece -- which talked about
-- when I wrote my praise this weekend.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. 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 invites you to comment on his column at