How Treasury Outsmarted Short Sellers
The Treasury Department is being very smart about its Citigroup holdings, Cramer said during Thursday’s Stop Trading!.
Rather than dumping its entire position at once on the open market, which would give short sellers the chance to take down the stock, the Treasury is dribbling its shares out in increments, which “creates interest” in Citi . Cramer said that Ford Motor employed a similar strategy, selling “a dramatic amount of stock between $11 and $12, and look where that is now.” (Ford was trading near $14 on Thursday.)
By slowly selling C shares, Cramer said, the Treasury will “end the pressure” put on by short sellers. In fact, any shorts who had been anticipating a mass dump by the government “will be sorely disappointed.”
“This has the fingerprints of Tim Geithner on it,” Cramer said, “who you know I think does a good job.”
Also, Apple shares were down during Thursday trading. Cramer attributed it to profit taking ahead of the iPad’s release. But he recommended that investors hold onto the stock until the day before the new tablet hits stores, on April 3, saying “there’ll be more buyers coming in.”
Cramer also noted that Amazon.com was “up big” today.
“Maybe people are starting to say [the iPad is] not going to destroy the Kindle,” he said.
Cramer's charitable trust owns Apple.
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