Bad news is good news. The macro information is exactly what we want to see. Softer data help us here. This plunge in durable goods is a win for the bulls.

Remember the conundrum. The big data are bad. That helps with the Fed. The little data, the news from individual companies, the micro, are bad and that hurts stocks. That's why people play a slowdown with cereal and drugs. That's what works. (Yes, tech that has no problem making earnings will still work. But most tech companies have some economic sensitivity. Ask yourself, do your tech stocks have that sensitivity?)

All morning I have listened to shocking declines in earnings estimates from cyclical stocks. This

durable-goods number is on target for that. (Durable goods include cars AND computers.)

The economy is visibly slowing now. Again, think

1994. We are on the exact timeline. Companies that can continue to grow earnings will go higher. Companies that stutter will go lower. There will be two markets, a bull market in those that can maintain earnings and a bear market in those that can't.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. 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.