Has the New Market Left You Behind?
When my wife came back to work in 1993 a little more than a year after the birth of our first child, she immediately set to work charting her favorites:
Maytag
,
General Mills
,
Stone Container
and
Black & Decker
. She put up 50- and 200-day moving average charts of the steel companies she liked to trade so much, the
Inlands
and the
Armcos
. She made sure she knew the levels for the
Georgia Pacifics
and
Boises
TheStreet Recommends
. She was ready.
But, I told her, we had moved on. We were trading Nazz now, the
Ciscos
and the
Sun Micros
; we were about networkers and servers and software. We were "done" with those stocks, I said, because that wasn't what was working.
She said, "OK, give me the new list; I will chart them." Try as she did, though, she couldn't kick the habit. A year later she was gone. She never really liked the new world of stocks we were focused on. She didn't want to get to know the traders and the analysts. She didn't want to learn the metrics. She was stuck -- blissfully stuck, I might add -- in groups that ceased to move, and she wasn't ready to move on.
That's how I see many of you right now, both in the hedge fund and the media community. You come to work every day and you check your
Intels
and your
Microsofts
, your Ciscos and your
Dells
. You call up the charts of the
National Semis
and the
KLA Tencors
. You obsess over the next move for
Qualcomm
and
Broadcom
, and you wonder if this is the real move for
Skyworks Solutions
or just a fake-out like with
Triquint
or
RF Micro
.
When I check around after a particularly good call on
Ultra Pete
undefined
, many of you are on the bad call for
Gateway
. When I hear about how great
Black & Decker
( BDK) is doing or
Pentair
(PNR) - Get Pentair plc Report
or
7-11
(SE) - Get Sea Ltd. (Singapore) Report
, I get told that the inventories for the Maytag-like
Texas Instruments
are too high. When I thrill to the incredible numbers that
Federal Realty
(FRT) - Get Federal Realty Investment Trust Report
throws up, you throw up! You are too busy gagging on whether
Doubleclick
is "for real" this time.
This market has left the old market behind just as I had to leave my wife's market behind. It's making great strides in a host of benign and mundane areas, both new and old companies, and it's not waiting for Cisco to cross $20 to do so.
Look, I can't blame anyone for not wanting to move on. Do you think I know what metric drives Federal Realty? Do I really want to know the penetration of Pentair's filtration systems or the demurrage of
Union Pacific
(UNP) - Get Union Pacific Corporation Report
vs. the red-hot
Norfolk Southern
(NSC) - Get Norfolk Southern Corporation Report
? Less than truckloads, whaa??
I live by simple truths: I look for the bull market where it is; I try to learn a few new stories every week; I try to listen to conference calls of companies I don't know; I try to figure out each day what metric matters in a particular industry. I do it because I am fascinated by it, so I have that edge, most certainly. Perhaps I am the rare guy who shows up for practice cause he genuinely can't think of anything else he'd like better to do.
But for those of you who are wondering how to get big gains, the answer is simple: Don't be Karen Cramer circa 1993. Don't wait for Stone Container to cross $18 or for Georgia Pacific to break out of $36 or for Maytag to take out $22 -- the ungainly analogues to Cisco and Dell and Intel of another generation.
It will cost you too much money ... in lost opportunities.
At the time of publication, Cramer was long Intel.
James J. Cramer is a director and co-founder 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.
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