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Sep.22
3:32 PM ET
Monday, 22 Sep 2008
Cramer: 'Ludicrous' That Goldman, Morgan Not Trading Higher

Goldman Sachs and Morgan Stanley are “best in show” stocks, Cramer said during Monday’s Stop Trading!, and deserve better share prices than the market’s giving them.

The Mad Money host called it “ludicrous” that Goldman [GS  Loading...      ()   ], with 11% tier 1 capital, is less favorable to Wall Street than US Bancorp [USB  Loading...      ()   ] or PNC Financial Services Group [PNC  Loading...      ()   ], which have exposure to bad home-equity loans. Cramer said that Goldman is getting no credit for the earnings the company has been generating.

Both Goldman and Morgan [MS  Loading...      ()   ] were down in Monday trading after receiving unanimous approval from the Federal Reserve to become bank holding companies. This will allow Goldman and Morgan to create commercial banks that hold deposits like Wells Fargo [WFC  Loading...      ()   ] or Bank of America [BAC  Loading...      ()   ]. The upside is gaining capital that can be used as needed; the downside is stricter regulation by the Fed.

Cramer was surprised that Goldman’s stock wasn’t higher, but with the Dow dipping 311 points, “You can knock down anything today,” he said.





Jim’s charitable trust owns Goldman Sachs and Morgan Stanley.

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