This Time Around, Bad Is Just Bad

Sometimes it is so bad that it is BAD! Don't laugh at that seeming bit of counterintuitive logic. Every investment professional knows that because of the way economic cycles and central banks work, you are often looking for signs of such stress and negativity that it is so bad it is GOOD because of what the banks can do and what a bottom looks like.

This time it hasn't worked out that way. This time, what's bad is bad and getting worse. This weekend, David Carr in The New York Times wrote an excellent piece about the mistake of looking for a silver lining, something that news media does.

The piece was caustic and skeptical -- rightly so, as you have to ask yourself, "Is it even worth it to look for the silver lining?" As the piece was about my friends on "Power Lunch" at CNBC interviewing two noted bears, I found the logic even more poignant than Carr might have realized.

That's because it has always paid, in the last 28 years, to look for the silver lining. Empirically, it has paid. Historically, if you look at all the work Jeremy Siegel did in Stocks for the Long Run, it has paid. The attitude of the hosts toward the bears, one of skepticism, has been the most intelligent approach to take since September 1981, a really long time to measure things.

But as we look today, with the so many of the Dow stocks alone threatening to be reorganized (see my piece from yesterday) and layer on the fact that the U.S. is probably in better shape than most of the world, you come to a brutal conclusion that we are simply in the prelude still, which is why -- much to the chagrin of the hedge fund community -- the outperformance, as meager as it is, has come from the stable growers, particularly in the health care segment, which cannot be stopped unless you are willing to let people die, something that has always trumped the cycle and always will. (See Abbott (ABT - commentary - Cramer's Take), Boston Scientific (BSX - commentary - Cramer's Take), St. Jude (STJ - commentary - Cramer's Take), UnitedHealth (UNH - commentary - Cramer's Take), Aetna (AET - commentary - Cramer's Take), Cephalon (CEPH - commentary - Cramer's Take), Genzyme (GENZ - commentary - Cramer's Take) and Gilead (GILD - commentary - Cramer's Take).)

ALL JIM CRAMER BLOG ENTRIES | POST A COMMENT | READ COMMENTS  

---

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. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. To order Cramer's newest book -- "Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer)," click here. Click here to order "Mad Money: Watch TV, Get Rich," click here to order "Real Money: Sane Investing in an Insane World," click here to get "You Got Screwed!" and click here for Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he appreciates your feedback and invites you to send comments by clicking here.

TheStreet.com has a revenue-sharing relationship with Amazon.com under which it receives a portion of the revenue from Amazon.com purchases by customers directed there from TheStreet.com.