The Good Stories Are Still Worth Mentioning

The troubled airline industry. The troubled auto industry. Have they ever not been "troubled"? For as long as I have been in this business, these two industries have been in huge trouble. Yet somehow it is news that United (UAUA - commentary - Trade Now), AMR (AMR - commentary - Trade Now) and Delta (DAL - commentary - Trade Now) are in trouble. Somehow we're still sweating the auto program -- and I, for one, thought Steve Rattner was doing a pretty good job and don't want to read into his resignation because too many times in my life I have seen the smear and know it for what it is.

I want to talk about the industries that aren't troubled. Last night CSX (CSX - commentary - Trade Now) reported a hugely profitable quarter despite a big decline in revenues. At one point the rail industry was a hugely troubled industry and you used to worry about the companies swinging to big losses every downturn. Now CSX gets 6 inches of ink today and the deeply troubled airline industry gets reams.

(Looks like I am not the only one enamored of CSX -- Bank of America raises its price target this a.m.)

Or how about Novellus (NVLS - commentary - Trade Now)? Here's a semi capital equipment company, one of the deepest cyclicals on earth that should definitely be looking for a federal bailout given how bad that business has been. Sure enough, it had a loss -- expected -- but saw a nice linked quarter uptick in orders, marking what could be the bottom of a long, bad drought. And how is it set up after the lean years? It has almost 40% of its valuation in cash and restricted cash. Unlike the Deeply Troubled airline and auto industries, the company's a bank despite the downturn.

We hear endlessly about the crummy industries with bad management and horrible numbers. I don't even think it is news anymore. I mean, come on, we all know as soon as the airlines go bankrupt they are right back in or some other company comes along to take up the slack. That's what happens. That's what always happens. Who cares? The greatness of the auto bailout is its finality. I figure we lose another $50 billion and then we move on -- still better than AIG (AIG - commentary - Trade Now), which put very few people to work.

I am concentrating on the CSX and the Novellus because they are why we are at 897 and not 597 on the S&P. I am not a silver-lining guy. I am just a realist. The people who think that the DEEPLY TROUBLED auto and airline industries matter to this economy anymore are living in the 1970s.

Random musings: Insana seemingly getting more bullish. I'm watching closely after the bank home run. ... I like Bensignor's call about oil and a possible bottom given that we are $5 away from the top of what I think is the real range of oil.

At the time of publication, Cramer was long Bank of America.

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