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:
- this moment in tech,
- bad journalism, and
- a few positive macro developments.
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Don't Miss This Moment in Tech
Posted at 6:38 a.m. EDT, April 21, 2009
We are so focused on the endless one-time gains at
Bank of America
that made the quarter look better than it should that we forgot about some other obvious positives that were occurring right before our eyes. I am talking about tech, and tech mergers and tech earnings.
No, I am not minimizing the problems of the banks -- did anyone think that Ken Lewis would choose to show a loss if he had a chance, as the bears seemed to urge? I am saying that when you have both
interested in something that we thought was worth very little just a few weeks ago --
-- when you have
interested in buying
-- another left-for-dead tech company -- and when you have
saying inventories are lean, mostly because of Asian demand, you are not getting a picture of despair.
In fact, the bank problems totally obscured what should have been a pretty fabulous day for tech, if the
hadn't been so far ahead of the other averages already.
When I look at the landscape of what to buy I keep coming back to tech because it is the universal anecdote: great balance sheets that do not need capital raising, a sector in bad need of consolidation that is getting it, a group of companies that suffered from tremendous inventory overhang, and a cohort that has enough Asian exposure that it can benefit from the successful Chinese stimulus.
Instead, we focus on Bank of America.
Tuesday looks like a turn, but I would think that turns would be bogus this soon in earnings season because we know
is going to be a repeat of Bank of America -- a good-looking quarter that everyone will pick apart.
But if you want to participate in the turn when it happens, you know it is going to be tech -- not drugs, not industrials, not financials, not oils, but tech.
So find what you can live with and buy it today, because this group is the only one with the staying power to make it through this period without a lot of questions, even though earnings will not be perfect.
A preannouncement in IBM leads to disappointment when we see the actual number. That's been the pattern with tech forever.
At the time of publication, Cramer was long Wells Fargo.
Bad 'Reporting' Makes Investing a Tough Game
Posted at 3:07 p.m. EDT, April 23, 2009
People often ask me why it's so darned hard to make money in the stock market. It's a great question. Of course the market can be difficult -- it can be counterintuitive (see the pieces I have been doing about
Procter & Gamble
), and it is often very difficult to understand why stocks go up on bad news and down on good news.
A lot of times, though, it is the way the information is conveyed and the way the media presents things.
I hear constantly that the media's too bullish, but that's a crock, especially when it comes to papers of record like
The New York Times
The Wall Street Journal
. The latter in particular has a bias that makes things really hard if you are going to try to make money on the long side.
I have a ton of respect for many of the reporters -- I always look at bylines. But I also recognize that some stories are such that if I said them on air or wrote them, I would have to eat crow. I would have to admit I made a mistake, but a print reporter simply shrugs it off and never has to apologize for it.
have to answer when they are too negative. Maybe that's why it is worth being so negative. If you never have to answer for it, why not be? Let me give you an example of something that truly angered me in the
On April 20, a "reporter" -- and I put that in quotes because he is really an analyst or commentator hiding behind the reporter label -- wrote a piece for the "Heard on the Street" column called "Fast Food is Investors' Heartburn." The writer of the piece took a look at
report from last Wednesday -- which was ugly, with the stock plummeting 20% subsequently -- and then extrapolated that to the whole restaurant industry. The language was all "sell, sell, sell" -- like this kind of thing: "Burger King's miss should be a warning sign to investors accustomed to steady spending on restaurants." Then there were questions about whether restaurants can compete with
-- a total canard that gets trotted out when you want to be negative. The notion of lumping in fast food with those two chains is pretty dumb, frankly.
Then the writer takes point aim at
, calling Burger King's numbers "worrisome" for the bigger chain.
OK, OK. If you read that piece you probably wanted to sell
Buffalo Wild Wings
There's a problem here, though. This group, which has been among the strongest groups in the market, experienced a gigantic rally after Burger King's quarter, as report after report came in with fabulous numbers, including that of McDonald's. It's pretty clear that Burger King had execution problems all its own and that the industry remains breathtakingly strong, as we would have presumed from the runs in Brinker and
-- 52-week high last week!
What bugs me is the writer kept you out of a terrific group with this piece. He scared you.
But it means nothing. He doesn't have to own up to it. You won't see a follow-up that questions whether Burger King's problems were just Burger King's problems. You won't see an apology for keeping you out of a bunch of 10% or 15% moves. You won't see anything that says even, "Oops!"
Part of me is just plain jealous. I would love to be able to get things wrong and not have it pointed out in a million places, including my own show. I would love to be able to say and write what I want and not have any consequences, like this Burger King writer can do.
But I can't.
Anyway, the takeaway is that reporting like this is great if it's right, but it's costly if it's wrong. And this kind of misdirection play is one of the main reasons it is so hard to make money in this market.
At the time of publication, Cramer had no positions in the stocks mentioned.
Posted at 12:44 p.m. EDT, April 24, 2009
Some larger macro developments deserve to be pointed out, and I believe they will cause the hedge funds that are short to cave and come in and start buying.
First, we have a definitive return to higher prices for the Baltic Freight numbers, even though today's were down a tad. Worldwide commerce is coming back. I regard this as massively important, because we had a multiweek downturn that caused great concern for my bottom, out-of-depression-into-recession thesis.
Second, we have a return to a rally for gold and oil. The former had paused because of the resumption of deflation. Now gold is back and it, too, is a sign of economic strength. Oil's been strong, even as skeptics abound, but that's world trade, too, not U.S., because that's measured here in concert with natural gas, which is in a severe depression. (The strength of those stocks is a total mystery to me.)
Third, there's hope that some growth might come out of Germany and Europe. I can't stress how important this is for the
complex, which has been pummeled because of newfound expectations of a resumption of the dollar's rally. If you take that off the table, you'll get a possible end to the endless liquidation of the defensives. It doesn't mean a huge rally; just less of a reason to sell.
All of these bear watching because they may hold the key to some of the reservations that people have about the notion of a turn (see my
first piece today).
I continue to see good things. I continue to hear loads of bearishness, and those two factors make me want to get a little longer here in the commodities, particularly after the reaction to
bonds are a gigantic buy. ... Oil stocks are still pricing in the imminent fall of crude. Economy's too strong to let that happen.
At the time of publication, Cramer was long Abbott, General Mills, Pepsi, and ConocoPhillips.
Jim Cramer is co-founder and chairman 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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