...seriously? It's long past time to jump ship if you're going to jump ship.

My question is, should I still be putting money into my 401K? I put in 6%, which my company then matches 100%, then at the end of the year we get a 5% of our base salary profit sharing bonus in my 401K. Should I still be putting 6% of my income into 401K?

Wow, lets all listen to Cramer. Wasn't he the one who said Bear Stearns was a solid company?

@captainpicard: I think regardless of how the market handles, it's best to keep your 401K investments since you automatically double your money. You may want to change where your investment is going. Unless some bank offers you a 100% investment return, I'd continue to fund it at your max.

Moron! Now that he is jumping off the bandwagon things must be bad. Here's how the fallout is going to play out for "main street" according to this article ( [www.savingtoinvest.com] ): Banks worldwide, stung by $588 billion in write-downs related to toxic assets -- especially mortgage-related securities -- will further reduce the flow of credit, strangling growth. That will push house prices lower, forcing additional losses and making banks even more reluctant to lend. As the credit crisis worsens, businesses will find it almost impossible to raise prices. They will then be forced to close or start laying off employees, which will in turn reduce consumer demand and thus create a vicious downward economic spiral.

My advice : Cash is king and perhaps it is time to invest in a cheap mattress for your moolah's.

He just said on CNBC that the market is undervalued right now and approaching the bottom. PEs are all out of whack with the price, and with everyone down across the board thats usually a sign of an impending bounce.

The Euro is dropping, Oil prices are way down, commodities are dropping like flies. This is a great time for consumers.

@captainpicard: Unless you're over 50, most likely. If you're under 40, absolutely. You can't touch that money until you're 55 1/2 anyway, and unless you're within (conservatively speaking) 10 years of that date, keep on doing what you've been doing. By the time you can withdraw it, all this stuff will be ancient history, and the funds your 401K money is buying right now will be the biggest gainers. Gotta buy low before you can sell high, and brother, today is a day to buy low.

What's he talking about? The bailout saved the stock market from tanking so everything is perfect again.

@pezhore: God, this is the new razorblades in apples story hoax. He said YOUR LIQUID MONEY WAS SAFE BECAUSE OF THE FDIC INSURANCE.

@pezhore: Not to mention Wachovia, who one of his best friends was the CEO.

If you've been investing with this guy all along, I see no reason not to doubt his word and not do as he says. Get out now, take your losses and go home.

For the rest who try to invest for the long term, make rational picks based upon research, not what screaming fools on TV say or what helicopter flyin' fools say you should do (which is to trade, trade, trade because they make money on commissions), this is just part of the deal.

People need to listen to the words of Benjamin Graham or Peter Lynch, not this Jim Cramer idiot.

@captainpicard: I would continue your 401K saving, but put it into the most conservative options you can. Remember, he said five years; most of us aren't retiring for at least another 30.

@captainpicard: Oh god, yes. The basic investment strategy is to buy low, sell high. It's low right now. (and if it goes lower, buy more).

If the economy collapses and you lose everything, money will be the least of your problems.

@pezhore: Ok .... If YOU as a investor saw what they where showing you, you too would have thought it was a solid company.

Lets be COMPLETELY clear here, Bear Stearns and other companies COMPLETELY LIED TO INVESTORS. What they where telling investors and what they themselves knew were completely two different things, and the likelihood Cramer knew that Stearns was cooking the books to show profit where there was none is very low.

While you can certainly fault Cramer for many things, you cant fault him on that one.

@buckfutt: I think we are seeing the buying start. Dow has gained 200 in the last hour.

@captainpicard: Absolutely, Put in your 6%, it is going to get match and regardless it is free money on the table. Mike is right, you may want to shift what that money does, but the mutual fund managers are already making adjustments to take your money out of financial institutions and into safer bonds and broad range groups.

How long before CNBC divests itself of Jim Cramer's services?

Awesome, maybe this is finally the sign we need that the market will turn around. Admittedly my experience with Cramer is pretty limited, but the few times I have watched his show and then watched what happened to his picks in the next few months, he has been 100% wrong.

If you have a 401k and 10 or more working years left and you're contributing with an employer match, keep it up. Your fund will be able to buy more shares with less money, then when the oh noes! OMG11! dies down, the value of all those shares will go back up and you'll look pretty smart. Look, Warren Buffet is buying like crazy now and Wells Fargo was going to pay way more than Citi was going to for Wachovia...that should be an indication...

@Aesteval: Don't misunderstand his intent. I believe he means speculative investments which are much more risky. Keep your money safe in slow growing industry standard investments such as P&G, Wal-mart (yeah I know, but hey...they will still be around even in a depression), McDonalds, Gold, and Ford. They are huge companies/ industries that have the resources to survive and continue to grow and are "depression survivors". Ford for instance is at a 20yr low, so I am acutally BUYING Ford and McD's like mad with money that I can afford to lose/ not use.

If Jim Cramer says it's time to get out, it's time to get in! Fortunately I won't need my money for 40 or so years.

I think his basic point is that the stockmarket is not a short term investment whatever the economic climate.

only a sucker would sell in a downturn.

@rpm773: Are you kidding? CNBC has the highest ratings in its history right now, and he is one of their biggest draws.

Market is up nearly 400 since 2AM.

PM

@moore850: But only a moron would stick with a risky investment. It'll be time to buy soon enough, but no one knows how low things will go. For investors who are feeling conservative, it's time to hold your capital until the market bottoms out. For people who believe that the market is indeed at rock bottom, perhaps it is time to sell. Personally, I'd say it really depends on the risk you feel like taking.

Stocks are on sale - it's time to buy and hold.

Personally, I get all my advice from shouting heads on TV. THERE IS NO reason to actually do any research. These people do not have ulterior motives or anything.

The only time my brain hurts is when they have multiple experts saying multiple things. I've developed a system, though: go with the prettiest one. If they're all fugly, go with the most excited one. Failing that, change the channel to Nickelodeon.

@moore850: That's not entirely true. Selling on a downslope isn't bad so long as you invest again when the market starts climbing. Removing all of your assets and never re-investing them is a waste. Cutting off the bottom of the parabola is not a bad thing.

So, what's his show going to be about from now on? Cooking?

Iv actually gotten a chance to see a few of the episode of cramers show and i must say that alot of the bashing he gets for things that he says pretty unwarranted. Has he made bad calls? absolutely, but he atleast admits to them.

The two instances that he is bashed on most were both mentioned in this thread already. His comment on bear sterns and his interview with Wachovia's CEO. The bear sterns comment was taken completely out of context, what he was saying was people who actually had money in the firm (aka NOT STOCK, ACTUAL INVESTMENT IN THE FIRM) would be ok (and they were made whole). It was pretty obvious to me based on the question (since it was an emailed question) and his response that this is what he was talking about (the caller later called in and said that in fact he was NOT asking about the common stock). The only thing i fault him for on this front is that he did not explicitly say that during the response but he paid dearly for that mistake. Onto the people having issues with the Wachovia CEO interview. That interview i thought was pretty heavy hitting for a television interview with a CEO. even though he never recommended the stock during the interview (after the company failed) he was the first to admit he had been "taken in" and placed the CEO on his wall of shame (which he has since removed because of the pending deal with Wells Fargo).

In closing, yes this guy does make some bad calls, but the ones he constantly get's beat on about seem to be people who just want to bash on him. The only advice people should take from the show (and the stuff he talks about constantly) is the "homework" aspect. Actually doing research on stocks that you own (he says 1 hour a week per stock) and making your judgment based on that (even on the stocks he recommends he says do this).

@pezhore:
Bear Stearns would have been fine if it weren't for an inaccurate rumor about their liquidity.

Yes. It makes sense.

Buy high, sell low. Great going Cramer.

Typical stock market "expert". If he actually knew anything, he'd make this recommendation roughly 12 months ago.

Remember Cramer only cares about the 'play' money people put into the stock market and his opinions do not (or should not) reflect overall investment strategy. Essentially his loyal followers are ones that have money to lose, and are not afraid to lose it.

@Aesteval: He's not saying jump ship, he's saying take the money you think you'll reasonably need in the next five years. If you can afford to have your money tied up in the stock market and are secure at your job (don't laugh, some people have relative job security, even in this market), then you probably don't need to be worried about this and can let things sit.

His point is absolutely bang on - if, in this lousy economy, it's likely you're going to need to pull out and sell stock at some point in the next five years (due to job loss, increased food prices, etc), do it NOW, not tomorrow - you're likely to get a better return on your investment today than next year. In other words, you're going to get more money now than you would later on when you need it more. Does that make sense?

If you can afford to hold out, then of COURSE that's going to mean better long term profits for you. But when it comes to having to scrimp and save to put food on the table, stocks are a joke. He's making this statement to amateur investors who will likely be selling stock in the next five years anyway, due to the issues he mentions.

So he thought about it all weekend and decided to come to the difficult decision to tell people pretty much the most basic investment advice there is - money for short-term needs shouldn't be invested in the stock market.

He's as full of crap today as he is on any other day.

The vast majority of consumers have no business being in individual stocks anyway. And even in a good market, any money needed within five years should be invested more conservatively and definitely has no business being in individual stocks.

Remember the basics... your time horizon, your risk tolerance, index funds/ETFs only/mostly, diversification, and dollar-cost averaging.

Sweet Jesus,who is still listening to this guy ? I mean ,really ? If you had followed his non stop buy-sell , buy -sell nonsense over the last 16 months, you'd have gotten KILLED. I don't know which way the market is going from here,but I do know that he doesn't know,either.There are good companies out there that are on clearance right now and if you tune out the steady hum of bullshit from people like Cramer,you can pick them up at an attractive price ,hold them and make lots o' cash. But if you tune in to these hysterical carnival barkers and panic, THE SAME EXACT PEOPLE that just picked your pocket for 700 billion skins will take another bite out of your ass. Please, folks, don't be sheep. Invest,don't gamble. Damn, this isn't hard...

@captainpicard: The advice in this video applies to you. Are you going to need that money in the next five years? Are you likely to be downsized? If you have relative job security (even if you do, keep your portfolio/resume current and circulating - competition for your skill set is always good, regardless of the market), your better bet long term is to do as the other people have suggested, and keep putting money into that 401k plan (likewise, check out where it's going, as mike mentioned).

The issue is if you're going to need some or all of that money in the next five years. If you can at all avoid touching it, DO - the market will inevitably bounce back, and when it does, you stand to make a chunk of money if you stay in now.

Finally, I don't know if any of the people here are more than armchair analysts. As such, it's in your best interest to talk to an adviser. Since you have a 401k plan, it's probably managed by a company like Vanguard, which has lots of information and helpful people around to give you sound financial advice. In layman's terms. So that you can feel secure about the choices that you're making, become more informed about where your money is going, and make educated decisions about what to do with it right now.

Don't do anything rash because you've bought into hysteria. That road always leads to remorse.

@proskills: I thought the recession was their biggest draw.

@You Cannot Untoast: I stipped relying on Nickelodeon for my investing advice ever since they got rid of Double Dare.

I mean, come on! It was FUCKING DOUBLE DARE!!!

A couple months ago I moved my 401K to a more stable value fund and haven't lost a cent since! I was down 8 percent for the year before I decided I didn't like the way it was going, now the plan I was in is down 22 percent and I've moved over to a stable fund and am making money(very small amounts though, but at least I'm not losing it). I'm just waiting for the stinking bottom to be seen before I put it back into the more risky stuff.

It was a shock to see a fairly prominent investment adviser (granted, of the talking/screaming head variety) telling an audience of millions to take their money out of the stock market. I understand the nuances of what he said, but the overall effect came from that simple statement. Yow.

Anyone who's watched an episode of Suze Orman knows that anyone needed their money within 5 years doesn't need to be heavily invested in individual stocks.

The title of this post is incredibly misleading. All he's doing is repeating some of that sound financial advice that has been serving those who heed it very well.

Of course, his manner (and posts like this with incredible titles) can only lead to further panic.

@captainpicard: Assuming you're not retiring in <10 years then I'd have to say yes, yes, yes, yes yes yes yes yes yes. Oh, and yes. If you can afford it, jack up to 18% (legal max). Now is the BEST time to pay into your 401K. Move everything from stable stuff into stocks, because now is the low point. When things are high (2-3 years ago) THAT's when you move stuff into stable funds that don't lose their value. Buy in the bottom, sell at the peak. You're on the way down. 5-10 years from now, stabilize it when people get stupid with their money and things are booming again.

giggling madly

You shouldn't have your money in the stock market if you ever need it in 5 years, whether it's in a volatile period like now or even in the boom years. In the short term, you shouldn't be doing that.

@captainpicard :

Would you wait until that house you wanted to buy shot up another 25%? If you have the means, now is the time to be buying. Now is the time everything is cheap. If the stock market completeley disintergrates, well, society is over.