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Bonds and the G-Forces Acting on Growth

Today is simply a textbook case of a market following the bonds.
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Today is simply a textbook case of a market following the bonds. This morning we saw bonds just collapse; I know I got hit by some flying by at the 91-26 level. Ouch! Felt at the time like my stomach watching the Loch Ness monster at Busch Gardens!!

Then, for some reason known only to the bonds, they lifted. And when they did we saw solid buying come in to the growth techs (nothing's going to save the drugs, I guess).

Now, with bonds at 91-12 and stalling, I would bet that if we don't take out higher prices, the growth stocks will be done for the day. In fact, if we don't see 92-20 I would think the move in equities has been made.

How powerful is this gravitational pull of bonds? When they started taking off there was still heavy selling in the top NDX names. But when the bonds crossed 92 decisively, the selling vanished.

In other words, we are all connected, no matter how much we would like to just focus on the


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earnings. I will continue to hammer home this point as I still think that most of our readers, at their own peril, ignore the G-force against growth that a sagging bond market exerts.

James J. Cramer is manager of a hedge fund and co-founder of At the time of publication the fund was long Cisco and the 30-year Treasury bond, though positions can 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 by sending an email to