Drawbacks of a Diary and an October Chill

This crisp morning brings to mind a similar one two years ago. Cramer still gets nervous about history repeating itself. Share your stories and strategies of Octobers past on our message board.
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Right now, right here, is where the diary form is so dangerous. I was just outside walking, and I felt the crispness of the air, the lower sun, the coolness of October. I happened to walk right by where I stood on the steps of the Fed Theatre, across the street from the Exchange two years ago the morning after the market dropped 500 points in a day.

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I remember the chill I felt as I was about to be interviewed on national TV on the big October selloff. And I felt it again. It was that shiver, that worry of, do I have enough cash? Am I too long? Can I handle a big tech shakeout?

Of course, I think yes. We make the decisions to buy or sell off the desk, in the calm of


office. We kick around these stocks we own dozens of times in a day. We have a nice cash position, a good cushion.

We are in good shape.

And then I think about when I walked up those steps to be on

Good Morning America

and the level of confidence I had that I wanted to buy because the market was so clearly overdone on the downside. I know that's not the case yet. I know we aren't done. We are still correcting.

But I want to be as confident as I was then. Does that mean even more cash? Always.

I can't afford a repeat of last October, when I was not confident and could not see the bottom -- other than when I called it by selling. I can't let that happen again.

Yep, the diary form doesn't allow you to be calm when you are nervous. It doesn't allow you to be relaxed when you are tense. It is October. I am nervous and tense, and I want to do this month right.

Which means plenty of cash, playing lean and not taking any chances until the bottom is as clear as it was two years ago to me. And avoiding my debacle of last October, when I was blind to the bottom that was right in front of me. I want to take advantage of the opportunities and not be paralyzed or worried about redemptions or my own insecurities as I was last year. I want you to learn from my mistakes.

Good luck this month.

Random musings:

Worried about October with me? Let's get a board going about previous Octobers. What we can do to invest and trade better in an atmosphere of worry. I will be there if you will be there. ...



, I know you see the headlines, and they aren't pretty, but

Carly Fiorina

is fantastic and a great change from the previous stumblers of HWP past.

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