Active Trader Update

Return to Article

Cramer: 10 Stocks Not to Panic Out Of

Jim Cramer

Let's go over the stocks you were supposed to sell during this stretch.

I heard negative things about Google(GOOG). Sellers of Google, have you thought about the disintegration of Yahoo!(YHOO) and IAC/InterActiveCorp(IACI) in front of your eyes? Those are the competitors.

Microsoft's(MSFT) MSN? Insistent on not doing a good job. Time Warner's(TWX) AOL? It has degraded its brand with endless ads and new editions of AOL that load you up with ads. That won't cut it.

Meanwhile, Google just keeps innovating.

You were supposed to sell Apple(AAPL). Wasn't that one dead? If you were s scale seller, you were able to buy some back perfectly and rebuild your position to be able to sell it into the launch and buy it right back. Those who sold none are doomed to repeat themselves.

MasterCard(MA) was supposed to be dumb here, tapped out. Plus we were headed into Visa-ville. Forget it; this story gets more exciting because I believe fees will soon be raised. The secular trend out of cash into cards remains a key driver.

Everything housing and auto was supposed to be chucked. But GM's(GM) leading this rally and I now believe that Toyota(TM) could tack on a quick $10. Meanwhile, Whirlpool(WHR) is breaking out.

Deere(DE) was supposed to fail here on the top in corn. I heard this stock written off by everyone and his brother. Caterpillar(CAT) got downgraded; housing was supposed to matter. The farmers keep getting richer; Caterpillar's an infrastructure play.

I got the call over and over again to sell Freeport-McMoRan(FCX). Copper was going to crash. A couple of strikes and an activist filing later and the stock ramps higher. What a joke the bears played on us!

When Exxon(XOM) -- the key to this market -- broke down to $82, I saw the freakout. It quickly reversed and now has some real momentum to go to $90, where I think it is headed.

As rates went higher, we had to fear the banks, right? Don't they do badly? No, they do well when there is inflection in the bonds, when they can take in deposits lower than where they lend. We are at last getting there; not yet. But earnings will ramp big if bonds keep going down. They are buys, not sells. Citigroup's(C) my pick.

Finally, didn't Goldman(GS) and Bear(BSC) disappoint? Aren't we supposed to be dumping them furiously? Aren't they supposed to have down earnings? Please. Now I have to panic and sell companies that trade for 9 times earnings?

I don't think so.

We were betting on bonds going to 92 and we were betting on ferocious consumer price increases. All wrong. The market was supposed to be overvalued but the rest of the world was much cheaper.

Once again, the prudent thing was to stay the course and not panic, or do what we did for Action Alerts PLUS, which was put money to work in the downturn. The reckless thing? To cut and run.

When will they learn? Hopefully never, so we can make much more money.

What's the real worry here? What should we actually care about? I only really worry about one thing: government intrusion, like the silly thing that the government wants to do with Blackstone. The key to this run is our government for, by and of the corporation. If that changes, I will get real worried.

Away from that, we sell on some bad news to buy it back when things settle.

Random musings: Rail breakout, rates going higher. ... Corning(GLW) breaking out here. ... Fannie Mae(FNM) must be bought here: Citigroup, Merrill, Goldman, Keefe Bruyette and Credit Suisse all have holds and numbers that are too low. I suspect we will see some people breaking ranks and going to buys next week. I would buy Fannie July 70s for a buck and change. ... Still liking Celgene(CELG) on multiple approvals. ... Poor little lamb Intel(INTC). ... If you haven't read Cliff Mason's column yet, what are you waiting for?