Continued from Part 1.
Buzz, don't you feel badly for those who came into your fund at the top?
Yeah, they have been pretty annihilated and -- now that we are speaking freely because you know the truth -- I really screwed it up. I clobbered these people with some really crummy judgment and I am really sorry. I told my girlfriend I should issue an apology, but she is in the business too, and she said, everybody would have to issue an apology so forget about it and it would show that we are weak.
And those stocks you told us you were buying with your cash?
What can I say, I was long all of them coming into the week. They were being vaporized and I am closely identified with them. All week I tried to prop them up so my
NAV didn't go down too much, but in the end it was completely
Sisyphean. I couldn't keep those boulders from crashing right back down to Earth.
Lets talk about some of the stocks you mentioned. Walk us through the reason you bought MicroStrategy.
To prop it up. I mean, come on, if this baby goes any lower, can you imagine the redemptions on my hands? People would be hitting that exit button like mad. I should have gotten out as soon at the
first sign of
chicanery there, but it happened so swiftly, I figured, what the heck, stick with it. I had no idea how bad it was. I should have cut my losses and run but it's too late now, so I will just keep buying. It is not a bad story if the
get off their back.
How about Motorola?
I was completely blindsided by that baby. I was on the
conference call and I couldn't believe my ears. I had no idea how poorly they were doing. Man, that one just took me apart. It was so swift. I didn't have time to get out of it so I just bought more. It will come back, it always does. It either comes back or I am out of here and going to another fund. That's the biz.
I see you are long Microsoft and bought more.
Yeah, I wasn't on the
call that talked about the
lite revenue. I was out marketing the fund. You know I was kind of hoping for a settlement there. And I never sell Microsoft. Heck, I never sell anything. To sell is to lose, man, at least until this week. Anyway, the public always buys the dips so I will get bailed out here.
Gee, I would have thought you had more conviction than that about your buy?
Never mattered before.
Tell us about this Sycamore buy. Was that because of something near-term? Something people can buy this week? A new, powerful switch perhaps? An important RBOC
regional Bell operating company contract win?
Nah, I just got snookered on the secondary at 150 and I have been averaging down. I bought enough at 50 to give me an average of 100. And then I tried to buy some more after the close Friday to "get it going." I figured if I take it up, Kathleen Tanzy, that nice woman at
who appears on
might mention it and I might be able to get some lift for the stock.
Talk about Vignette -- isn't that a Net infrastructure play?
These stocks have just been crushed and you know you have to buy them when nobody likes them. I have to do some work this weekend about what they actually do in the Net space, but they are leveraged to the fastest-growing part of the Net business, site design and engineering.
Aren't you worried that, with the decline in the
IPO market, that the companies that Vignette has done a lot of work for or is about to do work for won't pay them? Aren't you worried that there are plenty of prospective clients of Vignette's who will never get to the markets now
that the IPO window is shut?
Well you know, I could worry about nuclear war, too, but you know, stuff happens.
Really Buzz, I have friends in this business and they are worried that they can't pay these bills unless their companies come public. And that the businesses like Vignette will slow down.
That's in the stocks.
"I have to press you on this Buzz, because I think you are being too glib about the possible
Give me a break, will you, man? This was a real tough week. I know, I know, if the IPO window stays as nailed shut as it seems, Vignette will eventually get killed. Same with
and all of those other guys. But what the heck am I supposed to do? I had Vignette on my sheets coming into the week. I had an 80 basis. When it was cut in half, I moved to support it. Sue me, why don't you?
I am just trying to get at the truth.
I know and the truth us killing me. I knew I shouldn't have sat for this interview, but the marketing guys gave me a script and I tried to stick with it at first.
So what did you sell to finance the buys?
Let's see, I sold some
Was that you
wrecking the stock? I saw it went down about 50% in one day.
Yeah, I panicked a bit. I told the trading desk get 500,000 Emulex off the sheets and get it off now, because I can't keep my lunch down and look at the positions any more. They called all of the trading desks and the desks all said the same thing. Forget about it.
How did that dialogue go?
I can't share the real details because this is a family publication you work for, but it went something like this. We went in looking for a
bid on all 500,000. And everybody laughed. One
broker at a major firm said: "You walked this stock up 20 points when you bought it. You got everybody short. You want out? Last sale 90. I will bid you 65 for all 500,000." And we whacked him! Hah, he got killed. Didn't bother me; we had a 30 basis you know. But it was our largest position.
What happened that turned you off to the stock?
It had a cup-and-handle pattern and went through the 200-day moving average. I didn't like the money flow either.
No, I mean, what happened at Emulex?
Something about a slowdown in the sale of Emulexers. Something like that. I might have to get back to you on that with more details.
What else did you sell?
We blew out of bunch highfliers like
. Gee, that stock declined 100 points while we were trying to get out. We were going to sell
, but there wasn't much cash left to it. And biotech, oh yeah, we butchered
on the way out. I had meant to sell
, but in the heat of battle we sold the wrong one. I felt bad because I was more familiar with what Sequenom does than with Sepracor. But
c'est la vie
. We needed the cash to meet the redemptions that were coming in pretty swiftly. Oops, please, please don't run that. The marketing department told me to deny that we had any redemptions, no matter what. This could get me fired.
OK, let's get down to it. Let's talk about the future. How does it really look to you?
Frankly, just before this crash, I mean correction, I had bought a really big apartment in the city, 72nd between 2nd and 3rd, and a Range Rover to impress everybody on Egypt Lane, and I committed a really expensive rental in the Hamptons. I am trying to get out of the latter cause it is $100,000 a month, but they are telling me it is too late. I guess you could say I am a little nervous about the payments on the apartment.
Uh, that's not the answer Cramer was looking for. To read the conclusion of this mock interview with "Buzz," a fictional money manager, click here.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long Intel, Cisco, Sun Microsystems and Microsoft. 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