Is Cramer Advocating Index Funds?

One of the most effective ways to sell anything is to tell your mark that he's special, and that your product isn't suitable for just anyone, you know. The masses? The great unwashed? They can make do with mass-market products. But you - you're special. For you, I have something which, frankly, most people couldn't even handle.

The latest person to attempt this kind of pitch is one James J Cramer. According to Alex Tabarrok Tyler Cowen, he's now advocating index funds. But it's really a bit more subtle than that:

Most people actually won't get rich by buying individual stocks, Cramer says. Unless you do your homework, namely spending an hour a week researching for each stock you own, "You won't beat the market, and you'll probably lose money," he writes.
For Cramerites willing to do the research, the book helps construct a long-term, diversified portfolio. For most people, however, he advises low-fee stock index funds.

This is a little on the disingenuous side, as is made clear a bit later in the article:

Cramer's critics might prefer he not do the show at all. "There is a component of people who are not going to listen," but there are many other people who are helped by Mad Money, he says. So the show will go on.

Who are these people who are helped by a show starring a man who makes Steve Ballmer look like a Zen master? Personally, I have no idea. But in Cramer's mind (or at least in Cramer's sales pitch) they are the elite - the people who do their homework, the "Cramerites willing to do the research". For them, Cramer will blurt out buy and sell recommendations a fraction of a second after being given a stock ticker symbol over the telephone. Quite how that's supposed to "help construct a long-term, diversified portfolio," I have no idea.

But if you take Cramer literally, he's entirely correct. Most people won't get rich buying individual stocks. So don't. Because "most people" includes you.