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:
- the relative importance of commercial real estate,
- lessons from the restaurants, and
- a smart play in smartphones.
for information on
, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.
Commercial Real Estate Won't Be Our Undoing
Posted at 1:20 a.m. EDT, Aug. 10, 2009
If the banks are in trouble, they can do deals. If the REITs are in trouble, they can do deals. There's that much money around and there's that much good feeling associated with both. And this applies to the announcement just now that
What do I mean by "good feeling"? Look at
, which should be ground zero for commercial real estate worries, right? Tons of property in Boston, New York and San Francisco -- the last being among the worst in the country after Orange County. It did a huge secondary
10 points ago
! Everyone has made money. Gigantic. Just gigantic. If BXP wanted to do another deal for money to have down payments on distressed commercial real estate, it could do it in a heartbeat.
Or consider some of the banks that are totally linked to commercial real estate, especially
have a ton of commercial real estate exposure. But consider at what prices they did their stress test secondaries, and where they are now -- Key: $4.87 /$6.72; HBAN: $3.60/$4.81; RF: $4/$5.06; STI: $13/$22; USB: $18/$23; BBT: $20/$26.
If any of these banks wanted to take advantage of FDIC closures of other banks or even actual projects and buildings that come up for sale, they can do it, and they can do it in a fashion that will make investors' mouths water, because the bankruptcy risk is now off the table.
I know that many of you are happy to miss this move, in part because you think that commercial real estate will be our undoing. This move is one of the most despised moves I have ever seen. I am simply trying to lay out the case that you shouldn't be fearful based on this issue alone.
It is not a canard. It is simply dealable because of the appetite by investors for more equity in these big names. We should know soon ... if I were State Street, I would do a secondary right here to get fully reserved. I am sure the market would love it!
At the time of publication, Cramer had no positions in the stocks mentioned.
Action in the Eateries Can Be Seen All Over
Posted at 9:18 a.m. EDT, Aug. 11, 2009
A week ago,
rocked the restaurant world with horrid guidance. The casual-dining restaurant, part of the turn that started in December and signaled a brighter economy, seemed to say that the move was over.
The reaction was swift. All the restaurant chains got marked down. The rally was declared over.
Well, it's a week later, and the group's not moving down. Some, like
haven't given up their gains at all. Others, like
, are going up. (I recommended Wendy's yesterday on "Mad Money" because the turn is upon us.)
( CKE) acts well and has given up less than a point off of its huge run. And yesterday
reported an excellent number.
I think this Brinker selloff is indicative of something that Rev Shark talked about in his closer yesterday: The sellers just won't materialize. They didn't materialize yesterday when the futures tried to push the market down, and I don't think they will materialize today. Just as tech didn't take its cue from
, the restaurant ended up not taking its cue from Brinker. Maybe that's right, as Chili's is not by any means the strongest player in the group.
Why haven't the sellers come back? Why isn't there more profit-taking in this group? I think it's because of the realization that things are simply better and there's no reason to sell. There's simply no reason to have one foot out of the door anymore. The possibility of the hellacious declines of 2007, 2008 and the beginning of 2009 have ended.
This alone is the new landscape that makes me less bearish than others, although you can't be as bullish at
9300, and 1000 on the
as you were when Doug Kass nailed the bottom.
The sellers just don't surface. They don't whack bids. They don't create dislocations. In short, the sellers aren't desperate.
It was desperate sellers and short-sellers that worked hand in hand to destroy the market in the last couple of years. The former played more of a role than the latter in all but the banks.
With the sellers quiet, it makes easier to hold a CAKE or a YUM right through this period.
The lesson of EAT is instructive. A terrible guidedown, horrible chatter and a sense that a move is over comes from a leader ... and then nothing happens. No follow-through.
That's the action that defines this market since the Kass bottom. You could argue it creates complacency. I think it simply signals that the hot money's getting more money in, or that redemptions have ended because performance is better, or mutual funds need to catch up to the averages by buying. It is simply bull-market action, and it colored Friday's rally and it colored yesterday's muted decline.
: Run, don't walk, to see a powerful view of
what could happen -- not a "V," not a "W," just "ehh" -- by Doug Kass, with "ehh" being a very tough place to make money because it implies constant rotation. It is a view that I understand and I even address it in my next book in a favorable way. But there's one thing Doug left out -- I
totally and completely
piggybacked off of his bottom call and would most likely not have made it on my show and here without him. I did think there was minimal downside, but his switch was a generational call, and I will never forget it. As someone who at 11,000 and 10,000 told people to get it, it was vital to go back in there or else the opportunity for capital gains would be lost, and I owe it to Doug. Thanks Mr. Kass, you are MORE THAN WORTHY!
At the time of publication, Cramer was long Yum! Brands.
Smartphone? Smart Play
Posted at 1:33 p.m. EDT, Aug. 13, 2009
Does it have
exposure, or doesn't it? That is the question. When I look at what's moving in tech and what's become sullen and gloomy, there's only one compass: smartphones. Think about what's moved this week:
( TLAB) and
( ADCT). These are terrific plays in the smartphone food chain and are included in the "Mad Money"
ADC Telecom is Chinese Internet infrastructure, and we know that China's spending $40 billion to build out infrastructure that can allow aggressive adoption of smartphones. Tellabs has been waiting for next-generation telecom orders -- smartphones. I think the fact that it announced a giant buyback -- it matters when the stock is this small -- is the signal needed to suggest they are getting orders.
Cree's the lighting play off of the smartphones. That stock's been on fire for ages, but this recent number and the propulsion after reminds us of how big this category can be.
cannot meet demand for
for smartphones, and the
order hasn't even hit yet! Kaufman Brothers says
BlackBerry sales are incredibly strong, and the competition from sell-rated (by me!)
( PALM) has receded. Morgan Joseph agrees this morning in its downgrade to "sell" with a $7.50 price target. Looking like a one-hit wonder there because of returns and because of a lack of applications -- Apple's strong point. Obviously Apple remains the easiest call in the group, with
not far behind. Both have been stalled; both, I believe, are ready to break out.
If you are looking to parse wheat from chaff, ask yourself, "Does it have smartphone exposure?" If yes, buy on weakness. Heck, buy on strength!
: I like Helene's piece in her terrific "
" newsletter on high put-buying yesterday. No one believes. ... Doug Kass may be right about Paulson's potential flipping. But I say follow the money to
, the latter's doing really well. Readers report that RF has good earnings power, though, and could trade to $7.50 book as it has huge reserves. Call me skeptical as long as Wall-of-Shamer C.
Ritter is running the joint. ... Martin Sumichrast is out over on flagship with a must-read on how he's
-- great stuff.
At the time of publication, Cramer was long China Unicom and Qualcomm.
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