Do pros really sit on their hands and watch Alan Greenspan breathlessly, not making a move until the coast is clear? Not exactly. Well, maybe. OK, a little.
You bet we do.
On any given day I want to do certain trades. I am always looking, for example, to buy the banks on weakness. The last few times that Greenspan has been speaking, these stocks have gotten hammered.
All day I had my eye on
for a trade. I think these guys are doing very well, but the stock was sinking rather rapidly. I love trading J.P. Morgan because it packs a punch and the businesses are doing quite well, as of last check-in.
But Morgan drops like a stone when Greenspan is hawkish. It is one of the first to roll over. The stock edged down and down during Greenspan's go-round today. The moment Senator
thanked Greenspan for coming and praised him for having the Dow do nothing (up 10 at the time) I swooped down and took $134 stock, betting the financials could rally.
Didn't work. Never rallied.
But I like this bet for the next couple of days if we get a slower GDP, something I think could happen. Having sold my bonds during that nice dip down in rates off of Latin flight to safety, I have very little exposure to the financials.
Now that Greenspan is out of the way, I think buyers come back to that group.
The funny thing is that three times before Greenspan was finished I wanted to jump the gun, that's how fearful I was that others were also waiting for him to finish.
What I didn't count on though was that when Greenspan was finished speaking, the stocks that flew the most were the ones that were already doing quite well ahead of the speech: semiconductors.
Right idea; wrong group. For now.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long J.P. Morgan. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at