Jim Cramer fills his blog on
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:
- the four horsemen;
- how Yahoo! could again be great;
- "anointed" stocks you can buy;
- go-to names in tech hardware; and
- containment of the Bear Stearns mess.
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, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.
The Four Horsemen Take No Prisoners
Originally published on 6/18/2007 at 2:36 p.m. EDT
Right back. That's what
the horsemen do.
I'm talking about
Research In Motion
. These are the stocks that have captured the market's attention. When they get hit, the blows are glancing.
Take Apple. Last week, someone talked about how Safari or something was going to be bad for Apple because it didn't have many writers for it. The stock simply got hammered. Now the people who sold it are probably asking themselves why they did so. Heck, they're probably buying it back. I continue to believe that the key to the iPhone is the kids, like mine, who are demanding it -- just demanding it!
RIMM? New products, momentum, analysts loving it. Great growth; what's not to like?
Google, last week, saw nasty Comscore numbers showing that growth may not have been good for the last month. But then today, we read another spate of articles about how it is wiping the floor with the
of the world.
Amazon is the diciest. I have read some really negative pieces about Amazon and online commerce in general. To me, this company is truly taking share and kicking butt. It's been biding time after a mega-run; I think one upgrade and it's off to the races again.
The four horsemen, they just take no prisoners.
, I am not denying pressure-pumping price pressure. I am just
saying that the company's stock reflects the dramatic increase in pressure-pumping capacity that is driving rates down.
At the time of publication, Cramer was long Yahoo! and Halliburton.
Yahoo! Can Be a Great Company Again
Originally published on 6/19/2007 at 9:19 a.m. EDT
As usual, people don't understand why
should trade up, given how "bad" it is. That's a pile of nonsense.
Yahoo! was bad
now former CEO Terry Semel and his team. Anyone who doesn't know this has never been on the Web, never been involved in business with the Web and doesn't understand the dynamism of the situation.
I don't know if founder Jerry Yang's the right guy. I do know that Semel was the wrong guy. He was disengaged and nobody liked to work there. Keep in mind, this is a Web company, and the amazing thing about a Web company is that most people actually
to work at them because they are exciting and inventive and employees can really make a difference. I know the current perception of me is that I am some TV guru with a column on the Web, but not that long ago I was more well-known as an inventor in the media, and I have to tell you, I have seen Yahoo! fade from being the greatest company on earth to a company that seems like one of these failed states.
It is not too late. Yahoo! can be a great company again. It still has the eyeballs and the elegance. It still is
. It still can be re-energized, and I am genuinely excited about it
as a takeover target but as a company that can turn the earnings corner.
Of course, there are no guarantees. Bad management could lead to worse management. But I am not planning to sell it out of my
Action Alerts PLUS portfolio anymore. My plan had been to unload it into the rumors of change on Thursday when I was no longer restricted from trading it (glad I was able to tell Action Alerts PLUS subscribers to sell at $32 last time around, but I was restricted from trading it myself then too). Now my charitable trust owns a company that traded at these prices under terrible leadership; why sell it now, with the possibility that it's a call on great leadership?
So dismiss the company as you see it now.
But you will most likely come back to the company when it is better or when it is down $2 or $3 and gets sold.
That's a pretty fabulous situation, if you ask me. It's only available because people think that Yahoo! is unfixable. That's nonsense. It's just too good an asset to be run into the ground -- as hard as Semel tried to do so.
It's a nice call on the Web. That's better than most out there. For once, I am glad I own it.
Pathetic upgrade of
by Merrill today. The analyst only missed about 30 points. Unbelievable. ...
-- upside surprise. Lucky on that one.
At the time of publication, Cramer was long Yahoo! and TheStreet.com.
Seven Anointed Stocks You Can Still Buy
Originally published on 6/20/2007 at 10:15 a.m. EDT
Is there a price they won't pay for them? I am talking about the anointed stocks, the ones that won't quit. These stocks are flat on down days and up big on up days. We saw this kind of buying in the 1990s, but not in the last seven years.
Look at these:
- F-5 (FFIV) - Get Report, the fastest-growing play on traffic and the Web because it is a traffic cop.
- Ralph Lauren (RL) - Get Report, valuable to $120 because it is transforming from being a niche clothing company to a worldwide fashion empire that includes home goods.
- MasterCard (MA) - Get Report simply won't quit because it is the fastest-growing secular play on cash to credit.
- General Cable (BGC) , a play on putting power lines into the ground post-FirstEnergy's (FE) - Get Report blackout proximate cause: a downed tree!
- Whirlpool (WHR) - Get Report -- a play on a deal that should never have been allowed, Whirlpool and Maytag.
- Johnson Controls (JCI) - Get Report, which remains the only auto-related play that fills the niche of growth. That will be the case whether it trades at $114 or $140.
(Of the usual anointed ones, only
Behind the scenes you will simply see order after order by big shareholders, repeat orders as money comes in. Valuation concerns are being waved. They just are using these stocks as upside vehicles.
You can play, too. You need to own the calls struck five to seven points below the current prices on these names. I'd buy half now, and if they came in I'd buy more.
There's no choice. These anointed stocks are going higher even as the absurdity of it dawns on an increasing number of players.
These anointed stocks tend to be anointed for a full year.
We are in month six.
So get on board.
now and will never get back in. Too bad, because it was quality work about the company
but not the stock!
Same thing will happen with the
analyst at A.G. Edwards. He won't be able to get back in. What's the point of being so negative?
At the time of publication, Cramer had no positions in any of the stocks mentioned in this post.
Four More Go-To Names in Tech Hardware
Originally published on 6/21/2007 at 2:25 p.m. EDT
You can see where the tech rally springs from:
. It has reasserted itself as a bellwether of old tech and its resurgence has created a bid under the SOX that neither
has been able to achieve.
Given the lackluster performance of
, the move's rather astounding, but it is now resonating to the
The real winners in tech, though, at least tech hardware, have been
. These won't quit; they just keep ramping.
IBM's all buyback and delicious. They are sucking up the supply almost like
does (talk about a go-to name). Ciena's right off the strength it has against
and the stock is reacting to some amazing comments from
CEO Ivan Seidenberg about FiOS.
EMC? Numbers are too low; just a classic ramp coupled with a trimming of divisions that don't work.
These are go-to names. You can trade Intel; the rest are investible.
Cliff Mason and I have been doing some videos, the Cramer-Mason chronicles. I'm getting more feedback on these than anything I have done on
in some time. Check them out -- the latest one, on his eye-poppingly honest
column, just posted.
Click here to watch it.
At the time of publication, Cramer was long Hewlett-Packard.
Why the Bear Stearns Mess Will Be Contained
Originally published on 6/22/2007 at 9:01 a.m. EDT
Lever up and mismark, a toxic combination. That's my understanding of
what happened at
hedge funds. And I believe there will be
whatsoever beyond the funds, despite the innate desire by so many people to rumor and panic the marketplace.
It's driving me crazy that there is such unsophisticated reportage of this subprime issue.
First, most of the subprime blowups
involve credit defaults. In fact, other than New Century Financial, which had to restate all its financials
because of defaults
, most of the problems have been a lack of liquidity caused by the fear of defaults.
I say that because there is tons of demand for this paper from the likes of sophisticated hedge funds at Lone Star and Farallon Partners. I don't know the Lone Star guys, but the people at Farallon are just about the best in the game and there is
they'd be buying up these loans if they weren't confident that there would be a payoff well in excess of what they are putting up. Lone Star seeks a similar return. These are the buyers of this kind of paper, and they have done amazingly with it.
That's because they have cash. Which brings me to what these crises are really about: liquidity.
When banks loan to these subprime lenders -- and they can't lend without that capacity -- the subprime lenders become hostage to the credit committees of the big outfits, outfits like
J.P. Morgan Chase
If the credit committees of these big banks smell trouble, they cut off the credit. That's the real worry for the subprime outfits, liquidity,
creditworthiness. Any hint of problems and the liquidity dries up
even if there will turn out not to be much of a credit problem with the actual loans
. I say that because the Farallons and the Lone Stars are buying these loans fairly close to par. They wouldn't if there was a real risk of credit defaults on subprime.
Not everyone has been that careful. These Bear funds weren't. They borrowed a huge amount of money from the likes of J.P. Morgan and Merrill, and now those guys are squeezing Bear. And believe me, this is a competitive world and they
to squeeze Bear.
It was quite a business to do what the Bear hedge funds did, which was to borrow a lot of money and buy high-yielding debt at, say, 10 times the capital they had under management. But the same credit committees that were worried about the credit of the subprime loans -- and again, I am saying that there is an
by these credit committees but they are overreactors from way back because their whole job is pretty much to say no because one error can wipe out a year of profits -- are now worried about the lack of liquidity at the Bear fund, most likely because of redemptions.
The problem will go away with liquidity, which is why Bear Stearns is ponying up the money. The credit committees at the various other brokers will stop squawking and you will see an end to all of this.
But you have to understand that
at no time
was the credit of the actual paper really questioned. These firms just didn't want to lend to a hedge fund that had borrowed massive amounts of money to lever up in subprime and then suffered a hiccup when investors saw the true net worth of the portfolio marked to market.
I believe that had everyone had patience and had the credit committees not been so aggressive, this crisis would have been avoided. Again, it is
the subprime loans that are in question, it is the stewardship of the hedge funds themselves and the investors in those hedge funds that should be questioned.
Which is why I am saying that this problem will be contained. I don't want to be Bear; it will have to take a short-term hit on this stuff; but it is mostly a public relations issue. The vast and profitable organization of Bear can absorb any hit while the paper that the funds had comes back to life.
understand that it is
or the lack of it,
(as the rumor and panic players want to force on you), that is driving this. One is just a fact of life, the other would be a true crisis. We don't have one.
Blame some bad managers, not the subprime mortgage business. I am not dismissing the problems of subprime. Lots of people bought homes, watched them appreciate and then took out home equity loans against them. Those people are in trouble. And there are a lot of them -- but that won't be more than a blip for the financial markets.
If people understood this enough, if they were sophisticated about the differences between credit and liquidity, you'd simply be saying, "Those guys had a bad strategy and who can blame people for pulling out before the leverage wiped out their assets? And who can blame the credit committees for worrying?"
I worry about
-- it chews up a lot of capital and we don't want supply here, especially with KKR behind it. Why do these firms need to do these deals? Why bother with the public? Just to get richer, I guess. I don't want to own this paper. ... UBS finally raises
to my price target of $190. ... Enough people get there and I am out of here! Will Friday's charms -- it always seems to go up Fridays -- be able to offset morning weakness based on the bogus reporting on the Bear Stearns stuff above? I think so. ... Did
ever seriously consider buying
? Just asking.
General Electric owns CNBC, for which Cramer is a featured commentator. At the time of publication, Cramer had no positions in any of the stocks mentioned in this post.
Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
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