Trader Mike

Last week, after seeing the news of cheating in CNBC’s Million Dollar Portfolio Challenge I was glad I didn’t waste my time with that game. Once I saw that you couldn’t short or trade ETFs and some other restrictions I just decided to not even bother. Not to mention that I didn’t have the time to compete with people like this:

At the peak, the 42-year-old was spending 12 hours a day on the contest, using three computers in his Greenwich Village apartment to trade 1,600 different portfolios, all in an effort to win the $1 million grand prize. He even dropped his studies for the chartered financial analyst (CFA) exam, given once a year, so …

Wow, I can’t believe Cramer admitted to manipulating futures.

“A lot of times when I was short, I would create a level of activity beforehand that would drive the futures. . . . It’s a fun game,” Cramer said in the Webcast, which was moderated by TheStreet.com Executive Editor Aaron Task.

Cramer later said that “no one else in the world would ever admit that, but I don’t care.”

However, seconds later, he acknowledged, “I’m not going to say that on TV,” referring to his show on CNBC.

A remarkably successful money manager when he ran the $450 million Cramer Berkowitz hedge fund, Cramer in the Webcast shared his “tips” on how to drive a stock price down so that a short-position - a bet that a stock price would drop - remains profitable.

He added that the strategy - while illegal - was safe enough because, “the Securities and Exchange Commission never understands this.”

Some people find it hard to believe that this type of stuff goes on but I see shady questionable moves all the time. Check out what Cramer had to say for yourself. I guess this video should be called Manipulation 101 (Edit: In case YouTube pulls the video again, here’s the video on TheStreet.com):

Herb Greenberg has escaped his high-priced walls and is now writing at CBS MarketWatch. I’ve really missed reading Herb since my subscription to TheStreet.com ran out a couple of years ago. For those that don’t know, Herb is a master at raising red flags on stocks/companies. Even if you don’t like shorting stocks, you’d be well advised to think 2 or 3 times before buying any stock which Herb has written negatively about. His timing may not be accurate but he generally gets the story right and that will be reflected in the stock at some point. I’m really looking forward to reading his work again.