Jim Cramer fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he blogged on:
- How the double-digit drops in the European banks are disconcerting
- How it's still not the right time to sell though
Click here for information on RealMoney, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.
Cramer: European Banks' Double-Digit Losses Have Me Worried
Posted on June 24 at 1:31 p.m. EDT
It's tough to go down more than the 3% that Britain was down, as they are the epicenter of this, not us. But the complacency of Friday's opening was too much for me. Now we are getting more realistic.
Let's not be glib. I am not worried about systemic risk here. Our banks have never been stronger. Our companies are flush with cash. The world will grow more slowly than it is now, and our companies will be ready for that. We will be the safe haven.
But here's what I am worried about -- European banks. Lloyds (LYG) - Get Report is off 24%, Royal Bank of Scotland (RBS) - Get Report has lost 22%, Barclays (BCS) - Get Report is down 20%, Deutsche Bank (DB) - Get Report has dropped 16%, and Credit Suisse (CS) - Get Report has shed 15%. That's very disconcerting.
These moves are ugly, and they aren't the type of thing that happens in a vacuum. This is what you should pay attention to, not our banks or our industrials or anything else except oil and interest rates. (The former is bad for the bull, and the latter is terrible for the banks.)
This is a distinctly subpar situation.
Action Alerts PLUS, which Jim Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.
Cramer: Sit. Stay. Good Investor.
Posted on June 24 at 11:33 a.m. EDT
Sorry, this is all too glib. I would expect to be down big -- OK, not this big, but big -- if oil were down two bucks as it is. I would expect it to be down big just on a reversal of this week's bullishness.
I would expect it to be down big because a strong dollar means that estimates have to be cut, and I have been thinking the dollar was going to get weaker.
Instead, as a percentage basis, we are barely down. I know when I did the Today show Friday morning I was concerned that we weren't down enough.
I am concerned because have you looked at these European banks? Have you looked at the stocks of Deutsche Bank (DB) - Get Report , Credit Suisse (CS) - Get Report , Lloyds (LYG) - Get Report , Royal Bank of Scotland (RBS) - Get Report and Barclays (BCS) - Get Report ?
Do you find those prices reassuring?
I am not saying sell.
I am saying sit.
I think better prices are ahead, and I am willing to miss this dip as one that's simply not big enough to attract my attention.
Give me a break.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.
Cramer: A Liberating Look Beyond the Prison Walls of Brexit
Posted on June 23 at 3:56 p.m. EDT
Is there a better time than now to think longer term? Is there a better time not to be caught up in the maw of a vote that has distorted the perception of our future than this moment while an island off the coast of Europe allegedly determines the fate of the Western world?
Every time I go out west to CNBC's One Market headquarters in San Francisco, I am reminded of how myopic and short-term oriented we are on Wall Street vs. what's all around us here. The executives of the fabulous companies I see here actually are determined not to let fleeting events keep them from pursuing the prizes that make for tremendous success and, if we are right, riches for those who can own shares in their companies.
So, at the risk of choosing not to be trapped by the prison of Brexit, let's scan who's doing what and how their ingenuity may impact you.
I used to be a sports reporter, and I want to use that prism to describe the way people are looking at the season and the sked.
Right now, the company that everyone's most fearful of or respects the most isn't even in San Francisco. It's the Seattle-based Amazon (AMZN) - Get Report . Whether it be with the disruption in retail and what it means for all the other companies trying to keep up, or whether it be the connected car and how Echo combines with Ford (F) - Get Report to get your garage door open and your car unlocked while it warms your stove for tonight's roast, Amazon is worshiped. You ignore Amazon at your own risk, and only the paranoid survive against it, as the late Intel (INTC) - Get Report founder Andy Grove described so eloquently in his book about technological change.
How does this play out in the real world? OK, let's take Macy's (M) - Get Report , the iconic, 158-year-old retailer. Friday, we learned that Terry Lundgren, a terrific merchant, will be stepping down next year as chief executive officer. While there was chatter about Lundgren being nudged or the transition being sped up because of operational issues, what really matters was the statement the 64-year-old Lundgren released: "Now is the time to reset our business model. Our company must and will change in response to the profound secular changes that are driving consumer spending."
This is a remarkable acknowledgement from Lundgren because he's been resetting the business model for years not to compete with Amazon, and he simply hasn't been able to do it to the satisfaction of himself or his shareholders. Witness that the stock of Macy's is at $33 but stood at $69 this time last year. Some would say that Macy's is worth more dead than alive, meaning that its real estate could be worth more than what it can sell. That's because Amazon makes it far less likely that you'll go to a Macy's, while at the same time charging you prices that are always competitive, if not better, with free shipping. Amazon keeps raising the bar. To keep up with Amazon, Lundgren has to spend fortunes -- the same fortunes that Nordstrom (JWN) - Get Report and Kohl's (KSS) - Get Report and Sears (SHLD) and JCPenney (JCP) - Get Report and Walmart (WMT) - Get Report have to spend, with only the latter having the balance sheet and the scale to really compete. Hence, how Walmart's stock has held up much better than others.
How do you keep up? You have to hire companies that know what people are going to order ahead of what they will order and have analytics that give you ordering patterns and ways to stay in touch with your customer that make you more competitive. Or perhaps you need artificial intelligence that is smarter than the artificial intelligence Amazon has.
I cannot believe how many companies literally do nothing but make other companies competitive with Amazon.
Who else? There's tremendous respect for Facebook (FB) - Get Report , the company with a business model so many fear: content that Facebook doesn't pay for, content made by you, that advertisers want to advertise against. That's a license to print money. Then consider for a moment that Facebook's Instagram reached 500 million customers this week, gaining its last 100 million faster than the previous 100 million. In a town obsessed by growth, that number was the envy of so many.
You want to know the power of Facebook, which is part of our Action Alerts PLUS portfolio? Twilio (TWLO) - Get Report , an Internet tools company, came public Friday at $15 and traded almost to $30. Why? It's biggest customer is What's App, the Facebook messenger service, which accounts for 17% of its business. Uber is right up there, too. When was the last time you heard of an initial public offering that made you that kind of money? When Facebook is your biggest customer, you are going to be a much-coveted company.
You heard about Alphabet (GOOGL) - Get Report , also known as Google, but you hear about it for what it might be working on. The buzz isn't about search, it's about driverless cars. We spent time at Ford, which is a leader in driverless cars, but the notion of a Google skunkworks making strides with "machine learning," as they call it, has people far more excited about the company than whether search revenue may not be as robust as some think, which is a short-term weight on the company's shoulders.
You heard about Microsoft (MSFT) - Get Report , but only in the context of how it paid $26 billion to capture the growth of LinkedIn LNKD. You didn't hear much about Apple (AAPL) - Get Report , frankly, except that people seem almost grateful that they won't have to go upgrade their phones because the next iteration isn't supposed to be revolutionary -- some would say a suboptimal issue -- but others, certainly not the sellers of the stock, might just be thinking that the bar isn't so high.
You hear about all the different companies that are trying to disintermediate the entrenched, companies such as Robin Hood that I will be talking to Friday on "Mad Money." because it has an app that lets you trade for free. If it gets critical mass, that can be a real issue for the incumbents.
And here's the oddest one of all. You hear about Twitter (TWTR) - Get Report everywhere. No one can stop talking about Twitter, which like Alphabet and Apple also is an Action Alerts PLUS stock. Why? Two reasons: First, it's that everyone's on it, checking it, looking for news on it, seeing what people are saying in it, using it to get his or her point across and marveling that the putative Republican presidential candidate basically got the nod by tweeting and having the press report on it. A rock-bottom basement budget by the richest candidate ever to run; the irony is lost on no one.
But the other reason? Because, after LinkedIn got its monster bid, all the twittering is about who will bid for Twitter. Will it be Facebook? Will it be Apple? Alphabet? How about Microsoft? How about Salesforce.com (CRM) - Get Report ?
You know what's incredible? They speak of Twitter as if it is some diamond in the rough that's in the ground and the only thing you need to do to get it out, polish it and make it worthwhile is to get rid of the folks who run it. It might as well be the last diamond mine left to grab.
Now no one is dismissing Brexit, but certainly they do not care about the business consequences. When it came up, it was only about how it's an immigrant backlash and that it's a referendum about intolerance.
Look, I am not going to get into that. What I care about is this: You know what's being focused on, and when it comes to winners it's Amazon, and when it comes to last-place teams that can be next year's playoff contender? Just think Twitter, but the franchise has to change ownership before it can ever get out of the cellar.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long FB, GOOGLE, AAPL and TWTR.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long AAPL, FB, AMZN, GOOGL, COST, and V.