How Do the Analysts Not Get This?

What's with these analysts? Just like the fiasco of bank earnings last year, where the analysts kept their numbers high in the face of obvious losses and dislocations, the analysts are once again wild high in their pitching.

Did anyone really think that Caterpillar (CAT - commentary - Cramer's Take) could earn $4 or $5 in this environment? Did anyone think that Du Pont (DD - commentary - Cramer's Take) wasn't banking on a much better quarter than was possible? Why can't these analysts extrapolate the horrors of a worldwide recession and take numbers for these industrials down to reasonable and doable benchmarks?

I am reading through the Du Pont quarter, and it's so obviously terrible that, well, couldn't it have been obvious before the quarter was reported? Do we have to see the minus 3, 4, 5 GDP numbers before we recognize that even the best of the industrials can't come near what they thought they could do when they reported the previous quarter?

To me, it is obvious that business stopped in this country, and the world, post Lehman Brothers -- the logical extension of letting an institution that is Too Big To Fail collapse. The fear is too palpable and the risks too great to take on any new business, whether it be in autos or housing, the breadbaskets of places like Du Pont. Unless the workforce has been radically reduced, a company with those core markets will simply succumb to serious losses until the banking system is fixed and the stimulus worked out.

Oh, and one more thing, for all of the talk that CAT saw this coming, if you go back to the previous quarter, CAT was banking on a strong second half to see itself through, which is why it didn't make the cuts.

Those industrial managers that think we will have a strong second half are dreaming. It is why I like the recession-resistant names -- McDonald's (MCD - commentary - Cramer's Take) -- or the accidentally high yielders -- CAT being one of them -- until the crisis passes.

Random musings: Doug Kass articulates the depth of the Buffett problem and the end of the salad days elsewhere here. ... Looking at the Cisco (CSCO - commentary - Cramer's Take) note from yesterday that generated so much interest, I have to believe that Cisco is one of the companies that has scaled back enough to make money. But all in all, I would rather be in General Mills (GIS - commentary - Cramer's Take). ... The futures remain a silly place to get direction, as they were way up early this morning. Worthless barometer.

At the time of publication, Cramer was long McDonald's, Cisco and General Mills.

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Know what you own: Cramer mentions General Mills. Other companies in the packaged foods industry include Pepsi (PEP - commentary - Cramer's Take) and Unilever (UN - commentary - Cramer's Take).

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