This Absurd Market Is Following the Hedgies

Editor's note: Jim Cramer will present his 2009 stock outlook for the first time at TheStreet.com Investment Conference on Saturday, Oct. 25. Limited seating. Act now.

We sold 'em last week, and then we discovered on Monday that we sold 'em because Steve Cohen was selling them over at SAC. We take 'em up on Monday then. We sold 'em yesterday, and it turns out we might have sold 'em because of Citadel. So we buy 'em back today.

Great.

Just great.

Nothing to do with the fundamentals at all. Didn't have to do with Citigroup's (C - commentary - Cramer's Take) quarter or Parker-Hannifin's (PH - commentary - Cramer's Take) or Hershey (HSY - commentary - Cramer's Take). It had to do with the liquidation of the SACs and the Citadels.

Could we be more stupid?

We are now at the point where we literally have no choice but to expect that the big down days are caused by hedge-fund blowups, not company blow-ups.

We are now at the point where hedge funds gone wild are more important than the Philly Fed index or the price of oil.

It is an absurd market where the only conviction can come from dividends.

Everything else -- buybacks, earnings, fed plans to save the economy -- doesn't mean anything day to day. The day to day is controlled by liquidations and hedges and shorts and covering.

It will stay like that for some time, but it is heartening to know that at Dow 8400, someone stops selling and someone starts buying ... until the next liquidation.

Random musings: Short squeeze in Google (GOOG - commentary - Cramer's Take) -- call shorters probably take it to $400.

At the time of publication, Cramer had no positions in stocks mentioned.

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