Batch

: "Yes, but I thought he was too bearish. I figured that if, worst came to worst, these companies all sell out to

AT&T

."

Cramer

: "Isn't it true that such a scenario basically ended a year ago when AT&T took down too much debt?"

Batch

: "Yes, but you see I really couldn't get out of these positions. They were monster-sized and we didn't really know how to sell them."

Cramer

: "In other words, despite the long-term rhetoric of reassurance, you were worried about these companies but took no action?"

Batch

: "Well it happened so fast. We were in

Covad

(COVD)

and

Rhythms

(RTHM)

and

NorthPoint

(NPNT)

and

Copper Mountain

(CMTN)

and

Redback

(RBAK)

and we just got our heads handed to us so fast, we didn't know what hit us."

Judge Public

: "Let the record reflect that the Uranus Funds had no idea what it was doing with these telco pieces of junk and rode them to zero despite being apprised by reputable sell-side analysts that this would happen."

Cramer: "Why did you ride Cisco down from the 40s to the teens knowing full well that John Chambers guided numbers down twice in January, once in a conference at

Morgan Stanley

and another in an interview with Ron Insana at Davos?"

Batch

: "I thought Chambers was being too bearish."

Cramer

: "He is the CEO of the company. Don't you think he has the best handle on things?"

Batch

: "Well, here was my thinking: Lots of shorts were betting against the stock, and we at Uranus figured that if we bought the stock on that bad news we could cause a bottom and get the shorts to cover. This worked for many years, I don't know why it didn't work this time."

Cramer

: "Could it be that the fundamentals turned down this time?"

Batch

: "Sure, but we figured if we sell it and it goes up everyone gets mad at us, but if we hold it and it goes down with can just roll out the long-term flag and rationalize the bad decision with lots of rhetoric about not being judged over this period."

Cramer

: "In other words, you ignored the fundamentals with Cisco, played the same old beat-up-the-shorts game, and ended up hiding behind long-term rationalizations?"

Batch

: "Exactly."

Judge Public

: "Let the record show that our mutual funds took a bath in Cisco even though our managers should have known better. Those same managers now refuse to admit they made a mistake because it would rather just say it will come back over time."

Cramer

: "How about those business-to-business companies and those Net infrastructure companies -- the

Commerce Ones

(CMRC)

and the Aribas and the

Art Technology Groups

(ARTG)

and the

Scients

(SCNT)

and

Viants

(VIAN)

."

Batch

: "Yeah, we blew all of those. They were all shorts. We were long them."

Lawyer for Uranus

: "Object your honor, witness is giving up trade secrets without even waiting for the question."

Judge Public

: "Overruled, witness has a conscience; you don't."

Cramer

: "Did you ever read

Herb Greenberg

? For months he wrote that these companies were overvalued and in trouble."

Batch

: "Herb's always a bear. I read him. But I didn't believe in him."

Cramer

: "Did your checks tell you otherwise?"

Batch

: "Look, we took big positions in these stocks, dragged management to our headquarters and told them we would dump their shares if they didn't give us the numbers. So they assured us they could beat the Street and that's all we cared about."

Cramer

: "In other words, you didn't care that journalists with good credentials were writing over and over again that these companies would have shortfalls because they weren't selling enough into the end markets, and instead relied on management to tell you the truth?"

Batch

: "Worked well before. Sure wish we had listened to Greenberg. But can you imagine if we admitted that publicly, that some underpaid journalist knew more than we, who makes gazillions in fees? People would pull their money out left and right."

Judge Public

: "Let the record show that these managers showed no skepticism whatsoever about management and chose to overlook repeated warnings from people who had no incentive other than to tell the truth."

Cramer

: "Is it a fair statement to say that, despite your commercials, you should have sold the fiber optics stocks when the experts, such as Paul Sagawa at

Sanford Bernstein

, said that demand would slow dramatically, and instead you castigate these experts who were right in those very commercials?"

Batch

: "Oh man, those commercials are painful. I can't believe we are bragging about how much money we lost in fiber optics. We must have lost billions upon billions of dollars. Again, though, we didn't know how to sell. No one had taught us to sell. We underestimated the decline. We didn't know that we would lose billions of dollars. We got it wrong. We got it very wrong, and I feel very badly about my role in the fiber optics fiasco, which is what we call it internally. I don't think they will every come back, and there is a giant glut of these stocks. Oh man, did we blow it and I am sorry."

Judge Public

: "Let the record show that the witness shows some remorse in his complicity in the great fiber optic blowup that Uranus Funds had, and let there be mercy on his soul when individuals who lost their life savings because of this man pronounce judgment at

401k

contribution time."

Cramer

: "Your honor, I have no further questions. The prosecution rests."

Click here to return to the first part of this story.

James J. 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. While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column to

jjcletters@thestreet.com.