Jim Cramer fills his blog on
every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week, he blogged on
navigating the messy mortgage market
digging into deepwater plays
using a subprime checklist
how cool heads may prevail
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Don't Let Mortgage Mess Cloud the Opportunities
Originally published on 3/9/2007 at 6:39 a.m.
death rattle will no doubt weigh
on everything from
today. That's because the instruments the bears use to profit from the storm hurt everything financial and because the bears want to get their financial shorts on ahead of the reporting of
Which is why it pays to avoid that battleground entirely and look to trade tech or health care.
Although I dislike the semis, the bulls have
to drive up
. That could be a buck or two there.
The health care cost containment plays --
-- would be a good place to go. I noticed the rails kicking up.
And the drillers, courtesy could weather, have been an excellent gig to work in.
Sometimes during the day it bothers me that there isn't a network talking about all of the other ways to win that are silently going on all of the time. Extrapolating the winners is an obvious game to play but extremely helpful for home-gamers. Endless prattle about
next isn't nearly as helpful as non-prattle about how
has to drill deep water and
becoming a believer in the higher oil price scenario.
, with rapidly rising rates, seem so right, despite the insistence of analysts that the best is now behind them.
Battlegrounds can be dynamite places to play, if you are playing with paper. Isn't
Accredited Home Lenders
a coiled spring if it can produce its 10-K? Isn't it a dead duck if it can't?
That's the kind of thing that inspires fear only, and is a sideshow to the multitude of stocks going higher.
I just don't want to get confused about the main chance.
At the time of publication, Cramer was long AIG, Transocean and Goldman Sachs.
Don't Get Sucked Into Tech
Originally published on 3/8/2007 at 8:48 a.m.
The insistence that tech should go higher here is annoyingly palpable. This morning Morgan Stanley upgraded
and I am sure there will be the predictable excitement that comes from saying anything good about anything semi.
To which I say, "Great, in five months I am all over this upgrade." Not much in 2007 has played out the way people thought it was supposed to,
except the calendar
when it comes to tech, which is to say that you can't own it here. You just have to forget about it.
You can occasionally trade it;
at $440 seemed right for a trade. So do
But the semis?
are all pathetic.
And the softwares? Just try to get a rally going with
acting so sick.
I like the networkers, but in actuality that means I like
are just awful (and I know about the Ciena contract from
Scott Moritz's excellent work.)
To me, a call about the semiconductor equipment with endmarkets as weak as they are, ex-
, just seems like a giant waste of time.
There are some decent stocks in this market, but almost
involve tech. Consider
: great quarter and no real worries about
, it turns out. But the stock is still 8% from where it reported.
going to have outstanding iPhone numbers, but that stock too is rangebound.
The group just, to quote the CEO of
Don't get sucked in. It won't work.
Ah, the conundrum of what happens after a big up day. We go up 160 points, the most in ages, and we don't go up the next day. Is that bad or good? "Of course it's bad." We go up 160 points and then we go up 100 points the next day. Is that bad or good? "Of course it's bad; it's a short squeeze." I have done a lot of work on what happens after big down and big up days, and the work has revealed something startling, something downright shocking: The next day is of no significance! I sure wish it were, but sorry, the markets just won't obey.
At the time of publication, Cramer was long Yahoo! and Hewlett-Packard.
Dig Into Deepwater Plays
Originally published on 3/7/2007 at 1:08 p.m.
, the world's third-largest producer, is at last starting to ramp up spending for drilling. Mexico has become a net importer of fuel, having to bring in $10 billion in product, which is really incredible. That has to stop, so it is committing $17 billion to drilling.
is moving its drilling budget up, too, according to reports today. Meanwhile, oil is in short supply, according to the inventory numbers.
The drilling that needs to be done is largely deepwater. There are only three really fabulous deepwater plays:
National Oilwell Varco
, which builds them,
to drill them.
These last two companies' stocks simply haven't gotten the respect due their visibility and their multi-year rolloff of low-priced contracts for much higher-price-tag contracts over the next three years. National Oil has a $6 billion backlog growing at 20%; its market capitalization is equal to that backlog! A competitor,
, got a bid from
that would imply a $96 minimum price target for NOV.
Yet, the bears will not let these stocks lift. They just won't.
In the end, the bears are going to be run over as the fundamentals are too good. I am laying siege to Transocean and want to be as big as possible as I can for
Action Alerts Plus.com. This is where the action is for the next couple of years. That's the level of conviction I have about the deepwater plays.
At the time of publication, Cramer was long Transocean.
A Subprime Checklist
Originally published on 3/6/2007 at 9:21 a.m.
No doubt inadvertently,
The Wall Street Journal
has given us a fabulous checklist this morning to use when trying to isolate the subprime survivors from the catastrophes. Buried in the obituary for
was this paragraph:
The lender now is plagued with a surge of bad loans, costly obligations to buy back bad loans already sold to investment banks and inadequate reserves. It also faces regulatory probes and shareholder allegations that its officers and directors sold shares at inflated prices. The company has said it is cooperating in the investigations.
So, if we are looking for a bottom in one of these -- say
, because that one's the most adamant that it shouldn't be lumped into the parade of horribles -- we need to see:
No surge of bad loans
No costly obligations to buy back loans
No regulatory probes
No massive insider selling before the decline
I'm going to try to get in touch with some of the major subprimes today to see which ones can take that five-part challenge. I bet none of them can, but if they can they're certainly worth taking a shot at down here.
Don't know the answers yet. If you do, please don't hesitate to
If there are a lot of homes that are being defaulted on that people
, that's rather surprising because if they have jobs they can usually make it, and jobs are still very plentiful. Speculators obviously have been the equivalent of margined out.
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At the time of publication, Cramer had no positions in any of the stocks mentioned in this post.
Cooler Heads May Prevail
Originally published on 3/5/2007 at 11:09 a.m.
So Europe simply catches up with Friday's
action and no more that that. So typical.
Meanwhile, we trade down to 12,045, right where we hit Thursday's low on the Dow, give or take 10 points -- well, take 10 points -- and we can regard that as a successful retest.
Plus, we are now in a mode where we have buybacks working, we have a major reversal in the banks, and we have a remarkable tech rally.
All of this is enough -- third test of the level, buybacks in force, stocks bucking downgrades -- that you are getting levels where people are very interested.
Here's a thought: The traders freaked out, but other, cooler heads, looked at things over the weekend and liked what they saw.
Not bad for a morning's work.
Watch the dot-coms. I am convinced that
will have an upside surprise.
At the time of publication, Cramer was long Yahoo.
Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for
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