Cramer on BloggingStocks: A mockery of the game

Many hedge funds switched M.O.'s post-Regulation FD. They want macro. They went top-down. They did sector analysis. They took a more commodity-driven approach.

But some couldn't kick the habit, either because they had no other way of doing business or because, without the inside call, they couldn't beat the market.

When I read through the indictment alleging what Galleon did -- and the idea that there is a Galleon without Raj is pretty ludicrous, he was Galleon -- you could see that whether it be with Intel (NASDAQ: INTC) (Cramer's Take) or Akamai (NASDAQ: AKAM) (Cramer's Take) or Google (NASDAQ: GOOG) (Cramer's Take) or Sun Microsystems (NASDAQ: JAVA) (Cramer's Take), Regulation FD meant nothing at all. The indictment has them calling people they weren't allowed to call. They were allegedly getting information that should have frozen them, even as they should never have gotten it to begin with. And, worse, when they couldn't coax it, according to the indictment, they paid for it, giving the winnings of one illegal trade to the tipper for the next.

When you listen to the back and forth and the pros and cons and the lawyers for both sides, you believe that there is a case for what Raj did. The defense is insisting that the government isn't sophisticated, that it doesn't understand.

Nonsense.

The government is very sophisticated in this case, understanding what guidance would mean and understanding how Galleon had every single nuance of the next Intel call. It makes you feel like a total joker if you have ever traded Intel. You know nothing vs. what they had.

It made a mockery of the game. They made a mockery of the game. And, believe me, this, like the mob post-wire taps, this is not "he said, she said"; it is simply he said -- on tape. The guts of these guys that they thought they could get away with this.

It is worth reading the indictment to see how some firms post-Regulation FD contorted themselves to play the pre-Regulation FD game.

None played it like Galleon, according to the indictment.

None will ever play it again like this, believe me -- unless they have a jail wish, then it's game on.

Jim Cramer is co-founder and chairman 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 held no positions in the stocks mentioned.