Trading the Cyclicals: Back to the Boring Basics

The trader can't imagine Net stock traders doing the homework you need to follow the cyclicals.
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Fasteners. Bottles. Cans. Industrial gases. Whiteners. Darkeners. Aromatics. Linerboard. Bolts. Nuts.

Yeah, I guess I forgot what a bore knowing these cyclicals is. Especially when the shopping at

eBay

(EBAY) - Get Report

is fun and trading online is cool.

In the old days when I used to trade the cyclicals with my wife, we got all these boring trades and would follow the pricing of every little kind of plastic and wood grade. We tried to anticipate every price increase. Ingot pricing. Zinc pricing. Heck, we even got the

Journal of Commerce

to check container shipping rates.

Guess what?

We are doing it again. It's just as boring as ever.

Maybe that's what will be our edge. I can't imagine Web traders tracking cumin or alkali. Maybe they will.

I know I have to start doing so.

Random musings

:

Prudential's

downgrade of the retailers shows the power of firms to knock down high-multiple stocks when the time is right. I think the downgrade will be wrong, but I am just a big talker. I haven't bought any ones that have come down. ... High praise department: If you haven't read

The Wall Street Journal's

awesome

Northwest Air

(NWAC)

piece yesterday, you haven't talked with me. Mandatory reading. ... I used to think that Geoffrey dollars were something that you got from

Toys R Us

(TOY)

. Turns out it's

Amazon's

(AMZN) - Get Report

stock!! ... And can you believe more people talking about

EMC Insurance

(EMCI) - Get Report

than about

EMC

(EMC)

?

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At the time of publication the fund was long eBay, though positions can 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 by sending an email to

letters@thestreet.com.