Jim: In a previous Mad Money segment, you clearly explained why the double-short index funds did not perform well during the downturn. It was very useful information. Does your same conclusion apply to double long indexes like PowerShares DB Crude Oil Double Long in an up oil market? --Steve
Cramer says: “I think it does, Steve. I don’t trust any of these.”
Cramer: What's going to happen to the mortgage lenders when no one will provide warehouse lines? Two more banks announced they would no longer provide warehouse lines totaling $5.4 billion and about 27% of all lines available in the market. Non-bank lenders will be done, third party originators will be done, and competition in the market will be done. Rates will be so high that it will kill the housing market and nationalization of mortgage lending will be a reality. What are your thoughts on this issue? --Bill
Cramer says: “I think you’re completely and utterly wrong, Bill. I think that there are plenty of banks in this country. The banks will compete. I don’t like the warehouse lines. They tended to be given [in] a lot of cases to companies that didn’t do their due diligence. Now those companies need to fall by the wayside. I think banks that do mortgages and keep mortgages rather than sending them off into the netherland are the banks I want to go with. Could competition be hurt? You know what, look [at] what we just went through because competition was freewheeling – the worst housing situation in the world that gave us the second worst bear market ever.”
Cramer’s charitable trust owns ConocoPhillips.
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