While we all want to spot weak links in the system, do you think
is still insuring financial instruments over there? Do you think our insurers are buying big chunks of European bank debt? Maybe some, but it used to be the staple, and I think they have learned by now, much as I believe the money funds have learned. Again, though, there are outliers.
We neither need to fear as much as we used to, nor should we fear as much as we used to.
Now, the story's not going to go away because the incompetent European bureaucrats aren't going away. They still haven't rolled back the second interest-rate hike that was put through by former European Central Bank President Jean-Claude Trichet. The Europeans also haven't really addressed their banks in any systematic way, unlike what our
and Treasury have done. They let this Cypriot banking travesty happen right before their eyes, in slow motion, over many years. I mean, they do have regulators, don't they?
But, in the end, after the money's pulled out and the panic runs its course, do you think rich people will want to be in euros? Or will they want to be in dollars and benefit from the rise in the greenback?
Again, as I keep pointing out, I do not like the tape. I can't believe how many stocks have gone straight up. I do believe interest rates are going to surprise to the upside. I know the media will make the most of the riots I expect Thursday in Cyprus. I know that, if there is a line at a Spanish ATM, it will be filmed and broadcast around the world.
But, as I have often liked to point out, on Monday the market did
do what the negative people said it would. It was not crushed. It was resilient. Heck, it was even up nicely as one point, as nutty as that is.
Nevertheless, to the bears I talk to, that strength meant nothing. Nothing at all. Every negative person I saw or read simply said, "Just you wait." I don't know a soul who foresaw a market plunge who said, "Gee, that was impressive. Didn't see that coming." It was as if the rally from the lows never happened and the lack of a "promised" 2% to 3% decline meant nothing at all.
That's just plain wrong, especially considering how much was done to scare people out of their wits for the last 24 hours. Calm is one man's victory, but it's another man's defeat. Either way, one should own it -- not shrug it off or ignore it as if it never happened.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, has a position in GS.