Jim Cramer's Best Blogs

I know it is impossible to separate the SKF names, the Dow Jones Financial Average names, from the morass. But I also know that the market kept ticking even after the disasters of AIG (AIG Quote), Lehman, Bear, Fannie (FNM Quote) and Freddie (FRE Quote), Washington Mutual and Wachovia. I do not believe that Goldman Sachs (GS Quote) or Morgan Stanley (MS Quote) have suddenly gotten into the mortgage business. I do not believe that JPMorgan will need to be nationalized. I do not think that Wells Fargo (WFC Quote) has totally lost control of its own destiny. If we could simply draw a line between the healthier banks and the triaged bad banks, we could get some stabilization. We know that a market that "loses" Bank of America (BAC Quote) and Citigroup (C Quote) isn't a market that can rally. But we also know that if BAC and C are kept in business and its preferred and bonds insured, then we will get past this moment even if it means we take out the S&P 500 and Dow Jones lows, the latter more of a function of its inclusion of BAC and C than anything else.

Obviously now that we are officially oversold -- minus 6 on the S&P oscillator I pay for -- it is difficult to remain short. We got to minus 20 on the oscillator, unheard of, during the dark days of October and November. If we don't get that oversold -- and I don't believe we will -- then we can bounce based on all of the good news I referenced up top.

I hear the negative voices on the site, and I am negative in the short term until the BAC/C resolution. I am simply pointing out that the earnings period simply isn't as bad as I expected.

The state of things away from banks isn't dire. If you come up with a plan that makes it so banks' preferreds and corporate bonds are saved, and we create a list of strong banks and we give them equity, then we are going to turn out to be too negative if we don't go through the October and November lows, and that possibility can't be discounted.

Random musings: I am buying stocks for Action Alerts PLUS here given my discipline to commit cash when the S&P oscillator exceeds minus 5. ... I wish Hudson City (HCBK Quote) were offered good banks, with bad banks going to the FDIC. It deserves it. ... Terra Nitrogen (TNH Quote) holds up much better than Mosaic (MOS Quote), Agrium (AGU Quote) and Monsanto (MON Quote) because of that dividend...

At the time of publication, Cramer was long Abbott, Cisco, Freeport-McMoRan, General Mills, Goldman Sachs, Hewlett-Packard, Johnson & Johnson, JPMorgan, Altria, Morgan Stanley, Wells Fargo and Wal-Mart.