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Confessions of a Street Addict by James J. Cramer
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Confessions of A Street Addict by James J. Cramer

Okay, first thing you need to know: "Confessions of A Street Addict" is not some world-weary tale of heroin abuse, which the title and the author's hardboiled cover photo might make you assume. (Okay, maybe that was just me.) The "Street" referred to is Wall Street, and the experiences James Cramer relates here describe his time in the trenches.

Cramer wasn't born with a silver spoon in his mouth. His passion for the stock market begins in his youth in a middle-class home in Philadelphia, and is an enduring hobby through his scholarship years at Harvard and blossoming career as a newspaper reporter. A later stint writing for the magazine American Lawyer convinces Cramer that he should be a prosecutor, and he gets into Harvard Law School. Cramer does get the degree--he's even picked up by Alan Dershowitz to be one of a handful of the school's students working with him on the infamous Klaus Von Bulow appeal case--but by then Cramer's realized that his destiny is with his real first love, the stock market. Professional boot camp comes in the form of time served at the brokerage desk of the legendary Goldman Sachs, which formally introduces Cramer to The Street. More importantly, it introduces Wall Street to James Cramer. Neither has ever been the same since, especially once Cramer left Goldman Sachs and began his own hedge fund company, Cramer Partners.

What follows is comparable to an athlete's story--the fast and furious game of the contemporary American trading desk. Cramer makes sure to explain the often mysterious jargon and terms of the stock market, in clear descriptions for the layman, so that everyone is along for the ride. He revisits the highs and lows of both his career and his life, and we see how one affects the other. In the earliest days of having his own firm, renting office space at brokerage firm Steinhardt Partners, he has his first audience with one of their traders, Wall Street's so-called Trading Goddess, Karen Backfisch, who not only uncannily predicts the stock market crash of October 1987, keeping Cramer's company from becoming a dim memory, but also comes to join Cramer in both professional and very personal partnerships. Another major player in the life of James Cramer is Marty Peretz, a wealthy college professor whose faith and direction are invaluable in Cramer's trek from law student who leaves weekly stock picks on his telephone answering machine (Peretz makes so much money off these picks he arranges a meeting with then student Cramer and simply hands him $500,000 to invest) to head of a successful Wall Street hedge fund responsible for moving hundreds of millions of dollars through the stock market. A summer research associate hired in 1992 named Jeff Berkowitz proves so impressive in his stock picks that by 1998, Cramer officially recognizes his partnership status and renames the company Cramer Berkowitz.

Most extraordinarily, this isn't enough for Cramer. In the 1990s he teams up with Peretz to begin, a website dedicated to informing people about the stock market--an update of sorts of his old telephone answering machine announcements. His market expertise, coupled with his volatile personality and journalism talents, make Cramer the stock market's "king of all media," as he writes and is written about in newspapers and magazines, makes regular appearances on cable television financial news programs (including "Squawk Box" on CNBC) and on various network television programs, and, to this day, continues to contribute to the hard-won success of the now publicly-traded

It has not been easy. Cramer makes sure we see the trail of broken promises to his family and wrong-headed personal choices and decisions behind the big, bright dollar signs. He's been guilty of several missteps with the press since his days at Goldman, and these are well documented. You can see how was either his most brilliant idea or his dumbest; its creation and maintenance and eventual IPO (initial public offering) brought him into contact with some very colorful characters who did some real damage to his career and reputation, and nearly destroyed his longtime friendship and partnership with Peretz.

But Cramer is the very definition of a survivor. Plus, how can you lose if the Trading Goddess is by your side? Even though Cramer has many talents working for him, Harvard does play a pivotal role in his success--and skirmishes. Noticeable are the times a situation has spun around to his favor simply because certain roles were played by former school friends and classmates. But to be fair, this same association has occasionally left him vulnerable to sudden attack from former school nemeses. It's not what you know or who you know; it's how they know you and what they think of you.

"Confessions of a Street Addict" is a very grand ride through the ups and downs of the financial world in the last 15 years. From his bead on Reebok as a good buy in the early 1980s to the unprecedented, violent stock market activity (due to economic downturns in Russia, overvalued tech stocks, and the new Internet day trading) in the late 1990s which almost led to the closing of his firm, Cramer gives you a front row seat. Put down that "Investing for Dummies" book! It may teach you the words, but you need Cramer to teach you the music. Three and a half stars.

Simon & Schuster, 2002, $26
Reviewed by Valerie Hawkins
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