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:
- mindless selling,
- the end of crippling fear, and
- a much-needed breather.
for information on
, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.
I'll Never Understand the Mindless Selling
Posted at 9:21 a.m. EDT, May 5, 2009
Where are the sellers? Has anyone seen them?
Where are all of the people who sold those coal stocks like
( XTO)? What happened to those endless offerings of the natural gas stocks? Will they come back after that crummy quarter from
( XTO)? Or does it even matter anymore? Someone continually banged out
between $12 and $15. Did he finish? Where did these people go?
I have often wondered what the "book" of the sellers looks like. Is it something like, "Sell 300,000 Intel every day?" Is it, "I am a seller of
, 15 low," and they sell it every day until they are done and they don't even know they are part of the problem? Why don't these sellers let anything lift?
Look, it is one thing if they are margined sellers, if they have to sell. But it is another to just sell relentlessly until you are done, as was the case with
Las Vegas Sands
, which are now upgraded this morning by Merrill Lynch after a quick double. What was the need to bail when those stocks were at low single digits? Did someone have an "under $5" charter where they had to? What was the point? They couldn't look at their P&Ls anymore?
( LIZ). Nothing new was happening except positives as they languished in the low single digits. And then they fixed their balance sheets, and it still didn't matter. Who was selling at $3 and $2? What was their point? I would love to know the answers to these questions, because they are what's wrong with a momentum market. They simply keep selling until they have sold it all, and then they look like total dopes.
Take right now in aerospace. There will be sellers in
today like they were selling
yesterday and no doubt
today because of its "low end of the range" report. But I think there could be some significant gains in orders next year for Boeing planes. I also think the defense part is on fire. Balance sheet is good. Yet sellers come in every day. They will finish, and this stock will pop.
I think that's what happened with
. This stock was hit endlessly and then Buffett doesn't trash it and it rallies huge. Did people think that Buffett would give a folksy talk against his book: "I hate American Express and I am going to start selling it?"
The case of the vanishing sellers is truly an abhorrent case, a case of people at funds who have lost the fine art of getting out and of figuring out that a stock might be stuck in the mud because of their selling.
Watch this today. You will see the relentless pounding. I do not think the sellers walk away in this market. They just pound and pound until they are done.
And they are immediately exposed as idiots totally unaware of what they are doing.
I'd take my money from them, if I had any with them and if they have any left at year-end.
: Does anyone pay Roubini for his information? I am curious to know his stature. ... Does anyone understand how the
can write these endlessly negative articles and then not have to do anything or say anything when they are wrong? What a fabulous luxury. What a joyous position to be in. No penalty box. No
. Free to write whatever negatives they want to. How glorious! ... Should
be nationalized? Oops, it is building capital. Maybe it doesn't need to be. Maybe it should just be bought by another bank!
At the time of publication, Cramer was long Cisco.
The End of Crippling Fear
Posted at 10:48 a.m. EDT, May 6, 2009
Taking the depression off the table requires stocks to be revised up almost every day. We are seeing a total revision of the natural gas stocks as we work in the fact that the fuel is troughing and yet the companies are making much more money than anyone thought. Witness
, which got downgraded
by Barclays in a piece that talked about downward profitability and downward production growth, neither of which happened, so the stock has trapped the shorts.
That group's revision, which includes the numbers at
(which were extraordinary) is breathtaking
you consider how far behind oil and gas are from the mineral complex that it once traded with. The solid
( XTO) number takes my breath away. This should have been the worst quarter ever from that company. If it can deliver this kind of production growth and these kinds of earnings, who knows what it can do if natural gas goes back to its normalized price of $4 or $5. I don't even want to think what kind of return it could have at $10!
Then there are the banks, which now see themselves out of the Roubini wilderness. Maybe Roubini knew something -- maybe he figured that if we nationalized the banks we could have the profits accrue to the government. Hey, it worked for Lenin's government. All of the once-beaten-down regionals are being revised up radically as their prospects of being caught in the jaws of the bears like so many salmon going up the Mackenzie River to certain death seem to diminish every day. The regional salmon --
-- have escaped the jaws of bear death most certainly if
Bank of America
can rally despite coming dilution. Even
, always thought to have had a chance of flunking the stress test, seems to have gotten a Gentleman's C! Buffett's divisions continue to trump the professors who must be grateful for tenure.
Don't even talk about it. Can anyone own enough copper?
Steels? See above.
If you truly want to see the radical upward revision of the market's judgment of earnings power, take a look at
from when Fred Smith called the bottom. The stock was at $40. It hit $61 today! You had to suspend all judgment and go with the master.
Insurance is the same. The judgment of the market was that
, do not resuscitate; and
, all zombies. These stocks are at this very moment pronouncing the businesses underneath as alive and well, in part because the pressure from annuities is diminishing with the market rallying and in part because their bond portfolios might have hit terra firma.
In the meantime, the hatred of the soft goods companies and the drugs returns with a vengeance. There seems to be no price people will pay for the inconsistent consistency of a
had a great quarter, so it isn't going down as fast as the others.
Now, I am mindful that tech's not rallying and all rallies are underpinned by tech. I am mindful that the declines in retail are pretty stark.
But what I care about is the old black-hole formula, the idea that companies are going to go bankrupt because of balance sheet woes or because of debt covenants.
Those are what's going away.
Taking their risk off the table is bullish, plain and simple. And it means that even if the "market" can go down, the moment is bullish, not bearish.
At the time of publication, Cramer was long Abbott and Pepsi.
We're Just Taking a Much-Needed Breather
Posted at 2:29 p.m. EDT, May 7, 2009
Housing's recovering, but it can't stay strong
mortgage rates stay down. The whole thesis I have is that rates stay down, and that 30-year auction today isn't in my script.
Now, we have repeatedly heard that inflation is going to be a big problem; we are increasingly going to see higher rates on the 30-year. I get that.
But I am more focused on mortgages and the foreclosure pool.
We are seeing commodity inflation as we reflate the economy. We are seeing housing prices going up.
I just want to point out that the only thing happening here is we're moving out of depression -- where we were -- and into a recession. We are not in a growth mode, and as I search for reasons why a
is so strong, I come back to housing and the possibility that rates are going to go so high that it will stall out the housing boomlet. That would explain this strong rotation better than the notion of catch-up.
The rotation's gaining strength is worrisome for me if it has legs. It undercuts the legs of the major trend, which cannot happen if we are going to fight our way higher over time. I am hoping we're just working off the oscillator, but the charge in the
group is way too strong to think it can wane today. Touche, Doug!
I continue to believe that what is happening here is a garden-variety pullback and that we should accept it and be looking for buys,
sells. But it doesn't feel like one day anymore. That doesn't mean I don't want to pick up things. It
mean I want to pick up some things at this level and then wait. It also means I am kicking myself for selling some of the staples in frustration. It also means that I am furious at
for doing this acquisition as that stock would be at $55 today.
I am obviously in the big-time minority today in believing the selloff is not the start of something really serious. I am worried that the bond market freak-out is scaring everyone into believing we are going to have higher rates and the gains we have made in the economy will be obliterated.
Still, here's a saving grace: The drugs and foods don't go up on stagflation and gold's tame today.
So I am not willing to admit that this is anything other than a correction after a vicious rally. But I am hurting and feeling bruised for the day!
At the time of publication, Cramer was long Pepsi, General Mills, Celgene and Gilead.
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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