Product Description

In his new book, Cramer offers the most detailed guidance he has ever given on how to invest in a changed market. Savvy investors will not just survive; they will thrive. Cramer begins with six rules for protecting the money you have and making sure that you have the money you need. (Rule Number 3: Skip the first four stages of portfolio grief: denial, anger, bargaining, and depression.) Your portfolio won't fix itself; you have to do that. It's easy to close your eyes and pretend that it all never happened, but you'll never get back to even that way, much less profit from the opportunities that this new market offers to investors who know where to put their money. One key to making investment decisions is to watch what the mutual-fund managers are doing and -- better yet -- to anticipate their moves. Cramer tells you how to do this. Their decisions will move markets, and you want to profit from these moves.

Cramer explains why dividends may be another key to picking winners in the post-crash stock market, and he introduces a category he calls the accidental high yielders -- stocks whose prices have taken a beating, boosting their yields. Some of these stocks could make a major move upward; Cramer tells you how to spot the ones that could take off.

For the first time in any of his books, Cramer offers a portfolio of twelve stocks that he says are poised to profit from the economic recovery. And he gives investors a list of five regional banks that could make big moves and return a handsome reward to shareholders. As always, Cramer explains why investors can't just take his word but have to "buy and homework" on these stocks to make sure that their stories don't change.

If you're near or in retirement, your opportunities to recover and profit are more limited than those of younger investors. Cramer tells you why stocks should still be an important part of your investment portfolio. And for younger investors, Cramer explains why you must take advantage of what could be a rare opportunity to buy stocks at fabulous prices and set up a terrific portfolio.

Cramer offers advanced tips for investors who have the time and are willing to invest it to profit from the post-crash stock market. Call options may seem like exotic and dangerous investment tools, but Cramer shows why they can be a conservative investing strategy that can bring quick returns in a recovering market. He explains how to use IPOs and secondary offerings wisely to juice your investment portfolio.

And as if all that weren't enough, Cramer has come up with twenty-five new rules for the post-crash market. (Rule Number 4: It pays to follow the dumb money.)

Getting Back to Even is indispensable for any investor still reeling in shock from the 2008-2009 market collapse and wondering where to go from here. From investment strategies to specific stock recommendations, it's the foundation for the portfolios that will soar when the economic recovery takes hold.

Product Details

• Amazon Sales Rank: #214 in Books
• Published on: 2009-10-13
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 368 pages

Features

• ISBN13: 9781439158012
• Condition: NEW
• Notes: Brand New from Publisher. No Remainder Mark.
• Click here to view our Condition Guide and Shipping Prices

About the Author
James J. Cramer is host of CNBC's Mad Money; cofounder of TheStreet.com, where he is also an online columnist; and "Bottom Line" columnist for New York magazine.

Excerpt. © Reprinted by permission. All rights reserved.

1

Don't Give Up!

Getting back to even? What happened to making yourself and your family filthy rich? Could I possibly be aiming any lower? Have things really gotten so bad that you should drop all your hopes and dreams and just struggle to stay solvent?

Absolutely not. But before you can get ahead, you have to get back to even, and in difficult times that's the hardest and most important goal of all. For the last eighteen months we've watched in excruciating horror as first our homes and then our stocks have plummeted in value. Make no mistake, the stock market crashed in the second half of 2008, and this was a crash to rival anything we've seen since the Great Depression. It was the worst year for stocks since 1931. In 2008, Americans lost more than a quarter of their retirement savings in 401(k) and IRA plans, and millions more saw their retirement funds cut in half. For many of you, it's as though your money simply vanished into thin air. I'm here to show you how to get it back, one dollar at a time.

Ever since the housing bubble went bust and the stock market fell apart like a wet paper bag, we've been deluged with books that promise to help you weather the downturn and get back on your feet. But most of them either offer up the same old tired and often discredited teachings wrapped in a new, panic-filled package -- sell all stocks now and cut up those nasty credit cards -- or are full of advice that could have saved you a lot of pain if the books had been written two years ago. Wonderful timing. That's not what you'll find in this book. Hindsight is twenty-twenty, but you need foresight if you're trying to rebuild your savings, and especially if you're trying to claw your way back from the ground up.

I can teach you how to protect your money in a downturn. I know how to avoid a stock market crash and even how to take advantage of one. I was entirely in cash for the crash of 1987, and in fact that's actually what put me on the map professionally in the early days of running my hedge fund and allowed me to pulverize the market in the fastest decline from peak to trough in history. I also hope that if you read and followed the advice in my earlier books Real Money, Mad Money, and Stay Mad For Life, you were able to escape the worst of the carnage. But the sad truth is that other than gold, which does well in chaotic times, and U.S. Treasurys, the safest of securities, every single asset class from stocks to corporate municipal and mortgage bonds to commodities has just been hammered. Stocks took an especially severe beating that they've only just begun to recover from. In 2008, the two most important bellwether indices that track the health of the overall market, the Dow Jones Industrial Average and the much broader Standard and Poor's 500, fell by 33.8 percent and 38.49 percent, respectively. The damage has already been done, the money's been lost, and none of these new books filled with old boilerplate bromides about investing will help you get it back. Most of what you'll find on the personal finance and investing shelves is authors giving you an ounce of prevention, when what you really need is a pound of cure. But then again, they are just writers who have never managed money, not even in a bull market, let alone the vicious bear that romped through Wall Street, eating up and crushing the defenseless eggs that you thought were safe in your nest.

Anyone can see that these aren't ordinary times. This is still a moment of financial crisis, and I'm not just talking about the mess that Wall Street got itself into or the near collapse of our banking system. I mean the individual financial crises that millions of Americans are dealing with every single day: how to keep your home, how to pay for college when the college fund's gone dry, how to retire when your retirement money's been wiped out. This is the cash you were counting on, and rebuilding it is our first priority.

This book is your financial first-aid kit, an emergency room for your portfolio complete with epinephrine shots and paddles -- think "Clear!" -- to bring your pocketbook back to life. I can help you stop the bleeding and start putting your financial life back together. The new strategies, rules, and disciplines in this book will help you hang on to what you have and rebuild everything you've lost.

It won't be simple or quick or easy. I'm not making any false promises here. But the good news is that it can be done, that you can exercise some control over your financial future. Whenever we're in dire economic straits it's all too easy to fall prey to the belief that nothing can be done to make things better. Millions of Americans are losing their homes, their jobs, and their savings, not because of anything they did but because a relatively small number of people in the financial industry made bad decisions while the government was asleep at the wheel or worse, promoting the reckless driving that got us into this mess. We're all at the mercy of forces beyond our control, to some extent or another, but that's no reason to throw up your hands and stop trying. The absolute worst thing you can do is get caught like a deer in headlights and turn yourself into a pure victim of circumstance.

On the other hand, you have to recognize that this isn't business as usual. If you've lost lots of money that you need, then the stakes have never been higher, both for you and for your family. So how the heck do you deal with that kind of crisis? I can tell you the specifics, new investing strategies that incorporate everything we've learned about what works and what doesn't from the crash and its aftermath, and how you should vary your approach depending on your age. But first you need to make sure you're on an even keel.

Everyone remembers that famous quotation from Franklin Roosevelt's first inaugural address, "the only thing we have to fear is fear itself," but you hardly ever hear the rest of that sentence, the most important part, expanding on this fear: "nameless, unreasoning, unjustified terror, which paralyzes needed efforts to convert retreat into advance." Now, obviously, if you've just had your retirement fund shredded or are in danger of losing your house, you have more to fear than fear itself. Fear is a great motivator but not when it paralyzes needed efforts to convert retreat into advance. We've been through nasty recessions before, and believe it or not, it's possible to overcome the problems they create for you personally, and even to profit from the broader crisis and come out wealthier than ever. But to do that, you have to recognize that in extraordinarily difficult times, the stock market doesn't always operate according to ordinary rules. However, there are new rules, and rules I have pioneered to help you navigate your way through these brutal times. I can teach you how to learn from and play by these new rules and win while everyone else is trying to show you how to avoid a crash that already happened.

Why should you listen to me, and what makes this book so different from the standard fare? I'm a stock guy after all, and aren't stocks what got us into this mess in the first place? Look, I have been at this for thirty years. Unlike the usual peddlers of financial advice, I actually made myself rich by investing in the stock market and managing the money of my wealthy clients at my old hedge fund, Cramer Berkowitz & Company, including cleaning up during the devastating crash of 2000, when my fund was up 36 percent, while the Dow Jones Industrial Average took a 6.18 percent hit, the S&P 500 fell by 9.1 percent, and the NASDAQ plummeted 39.29 percent. I know how to make money in bear markets and during recessions. But beyond that, I've also been where you are right now. I know what it's like to lose a vast amount of money in a short period of time. I know how it feels to have my very future on the line. I understand the stress and the fear, but I also understand how to come back.

I still keep a memento of one of the lowest points in my life tucked into my wallet, and carry it with me wherever I go. It's a little piece of paper, a cutout from my daily portfolio run on the single worst day my hedge fund ever had, October 8, 1998, a date that, at least for me, will live in infamy. With less than three months left until the end of the year, my hedge fund, which was supposed to be managing $281 million, at the time was down $90,915,674 or 32 percent, because I'd made a series of boneheaded bets in the market. That's the kind of loss that would destroy most hedge funds, like the hundreds of funds that were brought low by 2008. It wasn't just my money that was at risk, it was my job and my entire career, too, not to mention my reputation, as virtually everyone I knew had written me off as a failure. Even The New York Times had written my premature financial obituary.

I was in the very same position that most of you are probably in right now. My investments had cratered and my future was in jeopardy. Practically everyone around me urged me to quit and head for the hills, wherever the hills might be, since I live in a Jersey suburb of New York City. So you see, I know exactly how you feel. But I'm not telling you this to show that I feel your pain. Empathy is great, but it won't make you money. You need concrete solutions and this book is filled with them.

Between October 8, that dark day when I was down almost $91 million, and the end of the year, I did what I'm going to teach you to do in this book. I got back to even, and actually finished the year with a small profit of 2 percent. I buckled down and in less than three months I made back $110 million, averaging $1.4 million in profits every single day. Not only is it possible to come back from devastating losses, but also, if you're lucky, you can even do it quickly. Now, in one respect you're in a much better position than I was in 1998: you don't have to worry about arbitrary time constraints the way a hedge fund manager does. No clients are trying to pull out money while you try to rebuild your capital, nor is anyone even looking...

Customer Reviews

Financial First-Aid - Cramer Style
First a caveat, Jim Cramer seriously annoys me. I rarely ever watch his show (especially after the notorious "melt-down") and less frequently read his books. However, as a college instructor and business writer, I read a lot of business books and make a point of keeping up with what is in the popular press since it tends to come up in daily questions etc...admittedly, I was also curious how well a book claiming to help people "Get back to Even" was going to do in the ratings...it's certainly a modest proposal at best and a constant reminder of financial pain at worst. Much to my surprise, Cramer actually mentions this early in the text so score one for Cramer!

The book is easy to read with a purely conversational tone; those that enjoy Cramer will feel right at home while those such as myself will still manage to get through it without constant irritation like listening to him on television. There is an abundant use of examples to explain any all all technical terms no matter how simple or complex but they do not (usually) insult the readers intelligence but rather enhance the reading nicely. The author assumes the reader has minimal prior exposure and takes little for granted so even novice investors or those that have always had their portfolio managed by someone other than themselves will not need to read with references in hand.

Now, as to the core of the concepts covered in the book itself. Cramer begins by presenting 8 new rules which are more or less "common sense" but well worth repeating given the typical lack of financial savvy of most "investors". I suspect most people will enjoy the statistics and rationale more than the actual "rules" themselves but it effective presents a foundation from which the rest of the book is written while acting as the typical disclaimer for all financial related books (ie, get your basics covered first).

Like any investment related book, there are likely areas to agree and disagree with...but if one manages to pick up a few nuggets it is well worth the time and effort to read. This book is no exception. Cramer is Pro diversification, gold/precious metals, dividends, performing your own research and weekly updates for stocks that you select. He goes into more detail than usual in how to research these stocks, his rationale for selection criteria and examples from both sucessful and non-successful examples in his own past.

For those that are well versed in reading/understanding financial statements, most of this will be rudimentary but as a person that routinely deals with people in various stages of financial literacy - there is a strong need for user-friendly information that can be applied directly to one's own portfolio. Cramer earns an "A"...he keeps the information direct, relevant and easy to understand while covering the flaws and limitations of everything from valuation to growth rates and the impact of "big money".

After a fairly robust section on dividends (like a dividends 101 abbreviated course), Cramer goes on to name 12 stocks to watcch for the recovery including a few well placed plus for his show and newsletter. As a general rule, I despise books that are thinly veiled marketing materials but in this case, didn't dock a point from the review because he showed quite a bit of self restraint and kept it to a minimum. Each recommendation is supported by a full rational including areas serviced, history, future potential etc as would be expected. Whether you agree or not, each is well worth the time for consideration and/or to use as a foundation for your own selections.

Bottom line - worth the time and effort to read. Novice investors will appreciate the examples and conversational style, more experienced investors will appreciate the actual stock selections with rational behind each even if you disagree. I suspect one of the largest complaints will be on what is NOT included in this book as well as the typical (and expected) diagreement surrounding Cramer's general investment advice...of course, readers should not expect a radical departure and will get what is expected in terms of Cramer's general investment orientation, style etc...

Mixed bag of advice
I liked this book better than some of Cramer's past books on amateur investing and trading. The first few chapters provide a long-winded explanation of how economic recovery inevitably follows recessions, and Cramer explains how he learned lessons from past market declines. He also repeats his past message of 'buy and homework,' meaning that buying a stock requires a commitment of an hour a week of reading about the company, economic outlook and industry trends. He again cites the virtues of diversification.

This book may only have a shelf life of four or five months to take advantage of his recommendations, but he tells readers to put money into cyclical stocks that will snap back in the early stages of a recovery, such as Caterpillar, J.P. Morgan, Visa and Hewlett-Packard, among others. He provides a short list of regional banks that he says have strong balance sheets and will be well positioned to take over weaker financial firms. The chapters on options are somewhat oversimplified. He basically recommends buying deep-in-the-money calls on stocks you think will rise in the near future--of course, finding those stocks is the biggest challenge for any amateur investor.

Some of the best advice I ever got from any investment books is knowing when to sell, which often divides winning traders from losers. For that, I would recommend the book "What I Learned Losing a Million Dollars." It's an autobiographical account of a Chicago futures trader who discovered that he never was a real trader, only a buyer of long positions that happened to make money during a bull market.

Ignore the short, angry critical reviews
For prospective purchasers, hopefully you read the reviews to items before you buy them. In the case of this book, Getting Back to Even, I want you all to know that you can safely ignore the vague, uninformative, and unhelpful reviews left by some members (who probably haven't even read the book). You should not be purchasing this book unless you know something about the author, Jim Cramer. He has a daily show here in the US, every week day at 6PM EST on CNBC where he discusses stocks and their companies. If you have aren't familiar with Mr. Cramer, don't buy this book. Buy his earlier books. Though they are not cataloged or described as a series, the different books focus on different aspects of investing. They all provide general investing information, but it loosely breaks down like this (I am not listing all of his books, just the ones I've read):

Real Money: One of his earlier books, it explains his methodology in an overview fashion. This is where I would recommend starting.

Mad Money: This book follows Real Money and goes into more detail on many aspects of Real Money, such as his prescribed homework for your stock picks.

Stay Mad for Life: This book focuses more on investing for retirement, so it's not as suited to younger folks such as myself (25/male). But it is still a great guide with a ton of great information on preparing yourself for retirement at almost any age.. except perhaps if you're already retired!

Getting Back to Even: Despite what some of the sensibility-impaired critics have implied or outright accused, Cramer never suggests that he is infallible, nor does he ever give you the illusion that if you do what he tells you that you will never lose money. He always makes it clear that investing in stocks, especially speculative stocks, has inherent risk attached to it and that no matter how good you are, you WILL lose money. The goal of his books is to help teach you how to minimize your losses and maximize your gains, with the only limit being the amount of effort you are willing or able to put into the process. Getting Back to Even is for helping those whose portfolios have been hit hard by the global recession. Again, this isn't the right book to purchase as a starting point; read his earlier books first.

And just for the record, if all you did was listen to Cramer recommend a stock on his show, Mad Money, and then went and bought the stock without doing the homework he RELIGIOUSLY instructs you to do, you deserved to lose your money because you ignored EVERYTHING he has told you to do to make money. Mad Money, the show, is not a stock-picking show. He doesn't just say the name of stocks he likes. He tells you WHY these stocks are good, in his professional opinion. He helps you with your research but he is NOT a substitute for it. Don't attack him because you were too lazy or impatient to do it properly. All he teaches you is to basically learn as much as humanly possible about the stocks you own or want to own-- how can that possibly be a "scam"?