Jim Cramer fills his blog on RealMoney 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:
- retail winners,
- a financial bottom, and
- oil's spike.
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Retail Has Pockets of Greatness
Originally published on Wednesday, April 30, at 2:31 p.m.
Now that the
out of the way with its bullish cut and the marking up can begin, it's time to acknowledge that retail's selectively on fire.
catches a downgrade from Raymond James and then it proceeds to go to 52-week highs. That three-headed franchise -- Urban, Anthropologie and Free People -- has an uncanny ability to locate in the right places, offbeat places, and execute extraordinarily well with a treasure-hunt excitement.
Speaking of treasure-hunt excitement, how about
, which is pennies away from its high and continues to execute better than any retailer out there. Food hoarders rejoice -- it's your store!
? I have been saying this one is going to $60 because people feel poor, courtesy the negative troika of housing, oil and food. Portfolio managers know that this is the place to buy, even though they have never stepped foot in one.
My fourth horse,
, has stalled here, but I think with so many retailers having problems TJX will get more than its fair share of close-out merchandise.
We've got three others on the move, too, that are worth at least pondering. The first,
, must have something going on. Check out the spike in that chart. The quarter was disliked, but the aftermath has seen nothing but buyers.
( JCG) acting well. Good style with good value. Mickey Drexler's a buy any day of the week, and I would still buy his stock here.
Finally, there's one that I have liked for some time because of its yield and its buyback:
. There's a quarter that was
to be bad but wasn't, and now they have the big Wal-Mart contract kicking in next quarter. Wes Card has done a great job there.
I don't like retail. I do like the four stalwarts: WMT, COST, TJX and URBN. But JNY, PVH and JCG have momentum and it's pretty darned impressive.
At the time of publication, Cramer had no positions in the stocks mentioned.
A Real Financial Bottom
Originally published on Thursday, May 1, at 2:36 p.m.
If you invested in any of the
( MER) financings, you are sitting on top of the world. Which means, alas, you can now buy more financings from Merrill!
I don't know if Merrill needs any more capital -- if you are a bank or a broker, it is hard to think you don't. I don't even care about the stock -- I own
But do not be oblivious to the fact that investors now have big gains if they participated in the
( LEH), Merrill,
Bank of America's
been a push. That makes the
( ABK) financings the outliers. That's incredible; it will make others want to do more deals, and it will make investors feel they are getting great deals.
Your takeaway from this should be simple: BULLISH. If you put money in a bank stock and you are up, you are inclined to put money in the next bank stock.
Mind you, I am more concerned about dilution and earnings power. These financings dilute that.
Nonetheless you are up now
regardless of dilution
, and A WIN IS A WIN.
That's another reason the rotation seems so real. There's an appetite for this.
Now, here's the billion-dollar question, or, more accurately, about a ten-billion-dollar question. Will
( FNM) and
( FRE) issue equity? If they do, they can be out of the woods for the rest of 2008, and by then, maybe housing will stop going down and FRE/FNM shareholders will be winners.
Keep it in mind: Put FNM and FRE on your screens.
Those are the ones that should be next. That will rid us of the last of about a dozen of Achilles' heels.
Talk about a bottom. Sweet.
At the time of publication, Cramer was long Goldman Sachs.
Oil's Spike Starts in the Ground, Not in the Dollar
Originally published on Friday, May 2, at 12:24 p.m.
Here it is, stark as day, the misinformed view that is coloring this market: "Oil's rise during the last six months has been fueled largely by investors buying crude futures as a hedge against a weakening dollar."
This statement, from
The Wall Street Journal
, is the kind of conventional wisdom that has dogged the thinking in this market for months. It is as absurd as the notion that Ben Bernanke holds the key to the price of chicken wings, as if his rate increases or cuts determine the price of grain feed and therefore chickens.
Yet it has so much credence that it has become the boilerplate explanation for every time the dollar goes up or down.
First, investors who want hedges against the dollar buy other currencies, just like companies do. They go long the euro or the yen, or they buy gold, but they do not buy oil futures.
The buyers of oil futures are those who are frantically trying to lock in their costs and want to anticipate higher prices so they can get some control over their bottom line. You can read that in everything from a
quarter to a
The sellers? Well, here's the real issue. The sellers are the speculators, because they sure aren't the producers.
Go look at the numbers
gave us yesterday. Exxon should be the largest non-national repository of oil, and Exxon has not been a believer in higher oil prices. It fought them when they went to the $40s and then to the $80s, and at $110 they still believe the whole thing is unrealistic. They haven't found enough oil to make a difference, even as they are the one company that may have been able to be somewhat of a swing supplier. Their production is
here. Clearly if they believe that oil should be at $50, they would be pumping their darned fool heads off.
said the same thing in a prescient interview in
The Wall Street Journal
, pointing out that it can't contribute much oil. Doesn't have enough.
Venezuela, Iran, Russia, Canada and Iraq are all either taxing their crude hoards so much that they can't be exploited economically, or they are keeping out or can't guarantee the safety of the companies' investments.
The Saudis? They want the price of oil to come down. They don't want the world to wean itself off of oil because their production costs have gone way up. The Chinese? They will buy any and all available properties because they need oil so badly.
I have argued over and over that the issue here is non-U.S. demand coupled with dwindling supply. What the heck does the dollar have to do with those circumstances? The euro could be at 1.25 to the dollar and oil could be at $140, given the lack of product. The speculators don't even have any oil to dump beyond the next month or two. The allegation that it is the dollar is about as silly as whether it would make a difference if we had ANWAR or if we could stop filling the Strategic Petroleum Reserve.
Of course, there is something at the margin about oil and the dollar that could explain a couple of bucks of oil. But that's about it. Those who think the speculators control oil have thought it for $80 now. Their rap is tiresome.
At the time of publication, Cramer had no positions in stocks mentioned.
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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