Chuck Prince is not the right person to be running
, Jim Cramer said on TheStreet.com TV's Wall St. Confidential
Web video Thursday.
When Sandy Weill, the former chairman and CEO of Citigroup, got in trouble, then-New York Attorney General Eliot Spitzer warned the company he was going to shut it down unless Citigroup appointed someone he could work with, Cramer said.
Prince at the time was the general counsel and "a very upright and honorable man." Prince was the "go-to guy" to fix up the bank's culture, but "no one ever expected him to be the operating guy," Cramer said. The idea that Citigroup defaulted to a lawyer to run a bank, and the fact that Prince is still running it even after Spitzer has gone on to Albany as New York governor, is "foolish."
"Citigroup has been at the cutting edge of everything that is bad," Cramer said. It was the last big lender to the private-equity companies, which is "just terrible." Plus, it was "one of the most active in putting together these mortgage products that are just awful," he added. Also, Citigroup, which Cramer owns for his
Action Alerts PLUS charitable trust, has been a very aggressive lender to a lot of people who shouldn't be getting loans, and it moved into Japan at the absolute high.
"Then the last thing he said was that hedge funds are the key things," Cramer said. "Hedge funds peaked precisely when he bought them."
Instead of buying Vikram Pandit and John Havens' Old Lane hedge fund, Prince should have bought the money mangers themselves. "You should never buy a hedge fund," he said. "All a hedge fund is is managers, but I don't think Chuck Prince knew that."
Cramer said he knows he's come on strong speaking out against the Citigroup chief executive, but at the same time, when he saw that Old Lane has gone down nearly 6%, he's begun to think what exactly it will take to get Prince fired. "Corporate America is such an unfair place," he said. "Lots of executives stay on. This isn't like the NFL, where you get fired after a couple of losses."
To replace Prince, Cramer suggested the bank consider taking someone from
. "Anyone from Wells Fargo is the greatest cross-marketer of product ever," he said.
While on the topic of banks, Cramer said he is increasingly warming up to
because it is not so big that it can't be acquired by a European or Asian bank. Citigroup and
Bank of America
, on the other hand, are too big, he said.
"Wachovia has got the great yield, it's proven to be a very shrewd lender and it's incredibly undervalued," Cramer said. "I think that when the smoke clears on this mortgage product and all the worries, Wachovia's earnings are going to explode. Wachovia is the bank that I would buy as the survivor of this era."
At the time of publication, Cramer was long Citigroup.
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. Click
here to order Cramer's latest book, "Mad Money: Watch TV, Get Rich," click
here to order his book, "Real Money: Sane Investing in an Insane World," click
here to get his second book, "You Got Screwed!" and click
here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by
TheStreet.com has a revenue-sharing relationship with Traders' Library under which it receives a portion of the revenue from Traders' Library purchases by customers directed there from TheStreet.com.