At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, had no positions in the stocks mentioned.
Strategizing for a Shutdown
Posted at 11:54 a.m. EDT on Thursday, Sept. 26You have to wonder how we can have a big move up that can be sustained given how much we hear about what can happen in a government shutdown. How do you get excited ahead of an event that could cut a percent out of gross national product? How do you start buying stocks when numbers are too high for all but the most international of companies? (JCP - Get Report) which, from all the stories I have read, does need to raise money. But let's think this through. One of the hardest hit areas in the 1995-1996 shutdown was travel. Non-essential services like passport issuances and national parks were shut down. You saw a dramatic decline in travel, which was the weakness that reverberated through the system. We know that the sequester knocked off sales for the airlines -- almost all referenced the sequester as a point of weakness. One can only imagine how badly this one will hurt the airlines, which have been a terrific leader of the bull market. Now consider how weak Hertz (HTZ - Get Report) is today, citing airline traffic. That was a hideous downside surprise -- the worst I have seen. But I wouldn't buy it ahead of a shutdown; I would short it. The rental car business was another leader in this market because of the consolidation in the industry. (JPM - Get Report), that's for certain. At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, was long JPM.