Road Runner

GE and Best Buy Face Challenges, Opportunities

I agree with you about GE and Best Buy. They have good management that is always looking to move their companies in a new direction if needed. Good management is something average investors often overlook, but it is key for a company.

GE launched their green focus a few years ago. I believe they will succeed at it once they get past their financial division problems. That is why I am an investor in GE. I like many of their green products like very high efficiency jet engines, wind turbines, Sodium batteries, investment in A123 for next generation Li-ion batteries, etc. They seem to be going to technologies that have high potential but are also “green”.

The main difference between Best Buy and Circuit City was management - Best Buy had good management and Circuit City had bad management. That was the difference that caused Best Buy to crush Circuit City, and drive Circuit City into bankruptcy. Meanwhile Best Buy was teaming with Geek Squad to improve customer service, while still keeping their prices down.

I’m not an investor in Best Buy because my focus is usually on technology – my undergrad is electrical engineering so I usually stick to technology companies where I can fully understand the product and market.

Cramer's Mad Money - A New Cycle (4/20/09)

When following Cramer, you have to keep in mind that he is a generalist. He doesn't fully research stocks. And, he uses the information from companies too heavily so he gets caught by executives putting heavy positive spin on their company. Thus, he can get caught off guard by negative changes that he did not foresee.

So, in my opinion, use Cramer as an additional source of information about a stock. He is very useful in this role. But, do not use his advice as your sole source of information and advise.

Also, it seems that Cramer's advice is good in an up market but bad in a down market. He'll get you into stocks that are rising faster when all stocks are rising. But, in a bad market, he gets caught by downside surprises.