Friday rally a la 1990 or something bigger? I say we wait until
Hour, when the bear of 3:30 comes on
and lets the bulls have it right between the eyes.
Many of you have asked me to knock this guy. Not my style. Never knock somebody who is hot. But if you think this rally has staying power through Monday, we will have 20 minutes to make a move after Favors talks.
Ron Insana told
after this column was published that Favors wouldn't appear this afternoon.
Let's review why it could be real:
a. We retested and held, which would be consistent with my bottom call.
b. The Japanese seem to be taking action. I know, I know, everything from Japan seems phony, but this talked about big tax cuts, which we have been waiting for.
c. The banks act well for the first time, amid rumors of consolidation in the group.
d. We got the first real sign of capitulation, when at the opening they wrecked the drugs and the phone techs, which had not really been tagged before.
e. We rallied in the face of awful selloffs in Europe.
f. We got a slow unemployment number, which makes the Fed's ability to ease much much easier.
g. We see lots of covering in the banks and the foreign equities, at prices higher than they traded during the last selloff.
Now the bear side:
a. This is exactly what would happen every Friday in the fall of 1990, and we still went further down. The bears took profits on Fridays the way the bulls took profits before the bear was in charge. It led to disappointment and heartbreak come Monday.
b. Nothing, I repeat nothing, has gotten better anywhere in the world yet, so it seems premature to believe this is anything but short covering.
Me? You know I think we retested the bottom. But I am not staking big bucks on this one.
James J. Cramer is manager of a hedge fund and co-chairman of TheStreet.com.
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 a letter to TheStreet.com at