SAN Diego (TheStreet) -- Sitting there watching Jim Cramer at 36,000 feet Friday morning, on my way back to San Diego from New York, it was a good thing I was buckled in. The turbulence in my head, sparked by what he said, was greater than the turbulence we were flying through.
What he said in a rapid-fire segment on CNBC's Squawk on the Street (and I'm paraphrasing): Forget the fundamentals, the crummy earnings quality, the business model concerns -- all of that kind of stuff short-sellers talk about. All that really matters is that "Green Mountain is selling Keurigs" and that "Herbalife is generating cash flow" and that the "hedge funds short it are only talking their books, so best to ignore them."
He didn't mention my name, but by mentioning those two companies, and by pronouncing the "H" in Herbalife (HLF), he might as well have -- especially since I have written and commented critically about both and since he and I had gone back-and-forth earlier in the morning via email about Green Mountain (GMCR).
What he said on-air, though, resonated to everything many of us are feeling right now about this market. Forget about whether it is undervalued, fairly valued or overvalued, based on whichever metrics you want to use.
All that matters is the direction of stock, which makes this the best of times for opportunistic traders, the worst of times for those who are not, especially those who dare tilt against the herd.
Which gets back to what Cramer said: I know exactly where Jim's head is at because I have followed him, worked with him, worked for him, fought with him, been on the outs with him, commiserated with him, laughed with him and at him for nearly 20 years. I consider him a friend and foe.
That's why his comments are, on one hand, so infuriating. I know that nobody respects the fundamentals more than he does. But I also know that he'll overlook them if he believes, at a point in time, nobody cares about them.
Thats where we are (once again!) in this market.
And it's a magical point, where rigor and discipline are trumped by the trade, the story and the stock.
But if history is any guide, it also suggests we're at or near some kind of inflection point, where complacency and hubris can, out of the blue, be humbling.
Reality -- and I hate to sound like a broken record: Nothing is more perilous than ignoring the risk, and Jim's comments about Green Mountain and Herbalife did just that. I get where he's coming from but also realize a lot gets lost in the translation of a fast-paced TV hit where there's always a stopwatch, or the dreaded "hard wrap," clicking in your ear. Buyer, more than ever, beware.
-- Written by Herb Greenberg
You can email me at firstname.lastname@example.org.