Be Careful What You Wish For

Sometimes a slowdown can bring some pain. But we have to accept the consequences.
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When you wish for a slowdown, you have to worry what you get with one.

Right now, in order for this market to go up appreciably, we need signs that the

Fed

is winning the war against both a red-hot economy and a red-hot stock market.

The consequences of such a win, however, are things like

Federal-Mogul

(FMO) - Get Report

, a company leveraged to the auto cycle that we learned today won't make its numbers. (It is down 10 points as I write.) Or the terrible action of the banks, which do poorly when the Fed ratchets things up. Or the miserable performance of the retailers, which always get pneumonia when the Fed sneezes.

We are now in the crosshairs of the expected slowdown. Unless your companies have business cycles that can trump the softer landing, the Fed wants you to get stung.

That's why we keep gravitating to tech and the Net. The spending cycles there are strong enough to override whatever the Fed throws at us. But that's a narrow, narrow market -- until the slowdown is visible to all and the Fed is out of the picture again.

Every time we get a soft number and it looks like the Fed is out of the picture (employment, producer prices) we get a strong number (oil, retail sales) that brings the Fed right back in. As long as we have this situation, we have to accept these consequences. If you can't accept it, you have to take some pain.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. 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

jjcletters@thestreet.com.