Ignore the Doctrinaires

Cramer says there's no relationship between silly market bugaboos and making money.
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Why do I get so angry when I hear that I can't be in stocks because the utilities act badly? Or because the breadth is terrible? Or because the transports aren't functioning well?

Pretty simple. Because if they do start acting better, I usually have to come in at a much higher level to get long. Take the utilities. They were spewing toxic waste between the eyes all last week, and we heard talking head after talking head telling us that if we get in, we better be ready to do the crawl in the Love Canal. No thanks!

But today the utes were screaming. So, I get it, up here I am supposed to buy them?

That's always been the problem with all of these confirming/nonconfirming thing-a-ma-jigs. They are too doctrinaire and too hindsighted. They can get you in when it is much less safe for the rest of the market, even when it is safe for that particular signal. That's what galls me.

Look, if I had been doing this game for four or five years and I hadn't shorted the market dozens of times on ute breakdowns or transport collapses -- only to have to cover much higher later -- I wouldn't be writing this stuff. Heck, you wouldn't be reading me. But in the 19 years that I have actively traded stocks, I have found very little correlation between these bugaboos and making money. Sure, they can matter.

But the doctrinaire way in which they are applied nauseates me. If I had not been spooked out of the market dozens of times over this stuff, I wouldn't care. But I have been.

When you see me write this stuff, remember why I am doing it. I don't want you to make my mistakes. I have made every one in the book. Why should you have to?

James J. Cramer is manager of a hedge fund and co-founder 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 at

letters@thestreet.com.