Pacing the Net

Cramer offers up his Yahoo! game plan.
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Ouch! I just averaged down on some

Yahoo!

(YHOO)

. I bought 2,500 little shares. I've waited 25 points, so that's a scale where I'd buy another 2,500 at 95, a level at which I'd be thrilled to get some.

This selling is intense. But think about the pace of it: If we continue to get these declines, some Net stocks will go through their cash value; others will begin to sell at prices to next year's revenue that seem comparable to other companies'.

We all want to wait until these stocks sell at reasonable price-to-earnings ratios. But that's not going to happen. These companies are building businesses; they're not building earnings. P/E ratios seem like a reasonable way to value these growing businesses.

We are getting there. And I hear about the deals being canceled, which is just right for a temporary bottom.

I am also selling the last of my

DOT

puts. I might buy more on a rally, but all I have left to protect is Yahoo! and

TheStreet.com

(TSCM)

, and I don't feel the need to protect TSCM down here.

Enough's enough. I have puts on a few more dot-coms, but again I'm waiting for more lift before I do anything.

And I have been selling puts on dot-coms all morning so I don't get trapped like last Thursday, when the squeeze occurred.

You know my Yahoo! game plan. As always, I welcome your bets against me.

May the best trader win.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long TheStreet.com and Yahoo!. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

jjcletters@thestreet.com.