This column originally published on our subscription siteRealMoney, where you can read Jim Cramer's commentary daily.
Just imagine, for a moment, what would happen if mortgage rates from
dropped to 4.5%. What would happen if gasoline fell to $2.50 or even lower? What would happen if commodity prices came down and down hard?
Would you like the situation? Wouldn't you like the idea that the
would be on hold at these low rates? Wouldn't you like the increased purchasing power you would get, especially at a time when the housing tax credit has concluded? Wouldn't you be looking for stocks to buy that were related to the consumer as they came down because of exogenous circumstances like foreign banks?
This market is giving you a resounding answer:
Nope. That would be foolish.
. None of that matters. Don't you dare think of buying a
, even as it can buy its products more cheaply with a strong dollar and sell them to you for less. If you are thinking about buying
, you are nuts, because of what's going on in Europe. Attempt to buy a U.S. bank? Are you kidding? Do you know how much
has on the hook in Spain? In Portugal? It might as well be called Portuguese National Bank, right? Isn't
Banco Bibao Trust?
Don't you see the relation between the euro and the price of food at
? Are you an idiot? Can't you see how
is going to get its butt kicked? That
has to slow because of Greece?
The idea that you think that a company like
trades with mortgage rates here and not mortgage rates in Lisbon is just fanciful. You are a moron.
has some exposure. Europe has been weak forever, and you have to ignore what they say about it getting stronger, because, after all, aren't they bozos who shouldn't get the benefit of the doubt? Wasn't John Chambers of
just fibbing when he said things were strong in Europe? Is there a vast national conspiracy among U.S. companies to lie about "the crisis" and how it will crush
sales, even as it doesn't have much overseas except Brazil?
Oh, and it doesn't even matter in the end, because we can only imagine how hard
will be hit by China. We can just speculate on the vast damage to earnings that
will suffer. Are you quaking about
like I am, knowing that there are simply regulations that drive orders to new engines they make, but that's totally overridden by the desire of the Chinese to cool commercial real estate? Are you simply a moron? You have to be more worried.
Maybe you are just brain-dead.
Anyway, if you have the misfortune of owning a stock that is in an index, any index, you will be "helped" by the great liquidity the "dark pools" give you, except when they order a full stop and stocks like
go to zero. Don't worry, the
has your back. They will develop a circuit breaker that kicks in when stocks are down 50%, but only before 2:30 and when each exchange agrees to let it happen. Now I feel safe.
The other day on Twitter I expressed that it can be beleaguering. There was a nice outpouring of people who urged me not to be, but there were the usuals, the people who say, "Why not tell people to go into cash? Get 'em out?" Smart -- like I did in October of 1998, even though I was reacting to being beleaguered? Or is it more like September of 2008, when I said that it was your chance to get out, and reiterated it in October of 2008, at
10,300, before it sold off 4,000 points. Believe me, if I thought it was October of 2008, I would say, "Get out now." I have no compunction about that, as long as it counts if I say to get back in at Dow 6500.
I have no doubt in my mind that the single best thing to do is become Nouriel Roubini. I could do it today. Something like this: "I got you out at 11,000 and 10,000, I got you in at 6500, I am now saying I hate it and will always hate it because of the dominos and how it is all going to crash down as the euro dike breaks. I will have been able to say, 'avoided 4000, caught 4000, sell everything' and my record would be clean to all but the pundit class and the Jon Stewarts who will hate me no matter what, because of snippets easily produced that can make anyone look like an idiot. (Cue the snippets!).
In the end, though, I am stuck with a market that still has a pulse with stocks that can still rally if given a chance
more pressure and more decline. So I advocate defense, and I advocate accidental high-yielding dividends -- another one tonight -- and I advocate a strategy that says to let the pessimism and skepticism build and let some banks fail in Europe.
But never forget that Fannie Mae,
, Washington Mutual, Bear Stearns, Lehman Brothers,
and Wachovia all failed (Wachovia can get some benefit of being bought before the run wiped it out), and
became a ward of the state. (I like Citigroup as it goes back to $3.15 through moronic government selling done by the equally dim sellers at Morgan Stanley) and we still managed to get back to where we were.
Now, I know that those aren't as important as the First National Bank of Lisbon/Madrid/Athens and that we should
compare the wholesale crash of the American banking system, save the soon-to-be indicted
(doesn't that have to happen?), to the collapse in a currency that brings money to us. Never. I am not that foolish.
I just, in the end, am stuck with the thought that
is levered to U.S. housing, not housing in Barcelona, and that
makes cabinets here to be sold here and not in Mykinos. I am stuck believing that
is just being conservative. I am stuck thinking that the New York Empire report doesn't counteract so many other regional reports from the Fed. Doesn't matter, for now.
Which is why I am wrong, wrong, wrong, and those who see the impact of the euro on
Housewives of New Jersey
certainly have the edge on this buffoon.
At the time of publication, Cramer was long AAPL, ACN, TEVA, CMI, HD and GS.
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Jim Cramer, co-founder and chairman of TheStreet.com, writes daily market commentary for TheStreet.com's RealMoney and runs the charitable trust portfolio,
. He also participates in video segments on TheStreet.com TV and serves as host of CNBC's "Mad Money" television program.
Mr. Cramer graduated magna cum laude from Harvard College, where he was president of The Harvard Crimson. He worked as a journalist at the Tallahassee Democrat and the Los Angeles Herald Examiner, covering everything from sports to homicide before moving to New York to help start American Lawyer magazine. After a three-year stint, Mr. Cramer entered Harvard Law School and received his J.D. in 1984. Instead of practicing law, however, he joined Goldman Sachs, where he worked in sales and trading. In 1987, he left Goldman to start his own hedge fund. While he worked at his fund, Mr. Cramer helped start Smart Money for Dow Jones and then, in 1996, he co-founded TheStreet.com, of which he is chairman and where he has served as a columnist and contributor since. In 2000, Mr. Cramer retired from active money management to embrace media full time, including radio and television.
Mr. Cramer is the author of "
," "You Got Screwed," "Jim Cramer's Real Money," "Jim Cramer's Mad Money," "Jim Cramer's Stay Mad for Life" and, most recently, "Jim Cramer's Getting Back to Even." He has written for Time magazine and New York magazine and has been featured on CBS' 60 Minutes, NBC's Nightly News with Brian Williams, Meet the Press, Today, The Tonight Show, Late Night and MSNBC's Morning Joe.