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TheStreet.com's Jim Cramer says the only action in the sector is that the rumor mill is spinning overtime. There are tons of ridiculous stories that can be written in the Naked City. Notice that every day we are blessed with a story about how there are three private-equity firms examining Lehman Brothers (NYSE: LEH) (Cramer's Take) and Neuberger Berman (NYSE: NEU) (Cramer's Take). I think I have read that story a dozen times now.
You can list them, too: Blackstone (NYSE: BX) (Cramer's Take), KKR (NYSE: KFN) (Cramer's Take), Apollo (NASDAQ: AINV) (Cramer's Take), maybe Cerberus. What are they going to do, deny it? "No, we are not looking at it?" Their investors would love that: "Well what the heck are they doing with our money?" would be the reaction of investors if they issued denials. I predict weeks more of phantom tire-kicking of Lehman by nonexistent private-equity firms.
How about private equity about to swarm over collateralized debt obligations? Usual cast of characters there. Right? Come on, those stories are a penny a dozen. Every day I read about them. But nobody, other than Lone Star, is doing anything, anything at all on this front. If there were buyers, you can bet that Lehman and AIG (NYSE: AIG) (Cramer's Take) wouldn't be in the woods, lost, hopeless, with tons of bad European paper.
Or this one: Chinese and Korean banks eyeing down-and-out brokerage firms and banks. What a staple that is -- throw some names in, and you have a darned-tooting good story.
How in heck does any editor not see through this garbage? And the reason it is so important is that we have had these stories written all the way down, and they have created a remarkable amount of bogus confidence. In fact, the only real story of any consequence involving fresh capital in the last month has been Merrill's (NYSE: MER) (Cramer's Take) trade with Lone Star. Nothing else of any consequence has come to fruition. They are all just hope and made-up stories about private equity. Stop being conned: Nothing is happening. Too much money was lost in the spring.
There. End of story.
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RELATED LINKS:
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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.
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