- stocks for skittish investors;
- how retail investors want to jump back into stocks; and
- GE's rebound.
It's Not Too Late to 'Get in the Pool'
Posted at 3:08 p.m. EST, Friday, Jan. 14 This market is driven by fear, but it's not the typical fear that drives a terrific bull, rather than the greed that has it running into the slaughterhouse. It's the fear that everyone has of being the last guy in the pool, of looking ridiculous to their customers, friends or family. They just can't come in "up here," and that's why we don't have a lot of non-institutional participation. Worse, judging by the horror stories, many people seemed to have been hiding in leveraged municipal bond funds or tax-exempts of the dubious variety because they so feared stocks. They are "all in," but they are in the wrong pool! By the time they give up and get in, the water will most certainly not be fine. To me, the trick for people who fear it too much is to at least use the price breaks you get in high-quality growth stocks. Ever since Nike ( NKE) and McDonald's ( MCD) have been crushed off their last bits of news, I have said that playing those two with deep-in-the-money calls makes sense. Now they are starting to roar, but it's not too late. > > Bull or Bear? Vote in Our Poll Doesn't satisfy you? Then how about Southwestern Energy ( SWN), an ain't-missed-nothing-yet stock, because it was one of the worst performers in the S&P 500 last year. Or if you want something tech that hasn't moved yet, I am blessing Micron ( MU), like many others on the site (and I like that, because it is being blessed both technically and fundamentally). Fear of being last is keeping people out. These same people will capitulate at higher levels. It's certainly worth being in the market until they do. Random musings: People are asking me if I am backing away from gold after this dramatic fall. Why would I do that? I think gold's a currency that is a must-own in a time when the euro and the dollar slug it out for ugliness, and it is a metal that is in tremendous demand globally as insurance against financials. You don't stop getting insurance when it comes down in price. At the time of publication, Cramer was long SWN.
Retail Investors Want In
Posted at 5:38 p.m. EST, Thursday, Jan. 13 You have to marvel at the consistency of these highfliers, of a Chipotle Mexican Grill ( CMG) that gives a talk and soars, or a Netflix ( NFLX) and an Amazon ( AMZN) and Apple ( AAPL) that seem to be completely separated from the gravitational pull of this market. I keep using these stocks as barometers of health, because as long as they keep running, they are visible beacons to retail investors of how much money can be made. Yesterday, as I walked around the Ford ( F) factory floor, these were the stocks that just kept getting talked about and talked about. Unfortunately most said they had either sold them or they missed them. But they are followed closely as a measure of how the market is doing. Why is that healthy? Two reasons: One is that despite all of the bullish sentiment I keep hearing about, I don't see people in these stocks. I just hear people gripe about not being in them. That's not the sign of a peaking bull market. It's the opposite. At the beginning of the blow-off stage to the Nasdaq in 1998, we had a lot of this same reaction to the highfliers of that era. "I missed them." Kept hearing that. The market was able to almost double while people bemoaned "missing them." It wasn't until everyone was "in them," as I think they were in the latter part of 1999, that you had to worry. We are far from that. The second reason why it matters is that they intrigue people. You don't get a "The market is crooked," or "I can't touch the market anymore" when you are with the rank and file. You get much more of "I can't wait until they come down so I can buy them." A "want to buy" attitude -- not an "already in" mentality -- and a cautiousness "waiting for a pullback," not a reckless buy-at-all-costs style, is another important sign to me that we have further to go and that retail investors are just now beginning to focus on making money in the market again. At the time of publication, Cramer was long AAPL.
Posted at 3:14 p.m. EST, Tuesday, Jan. 11 Certain stocks are telling you that demand exists, even though the aggregate numbers might say otherwise. Global demand, like for engines and transportation equipment for expensive infrastructure projects and power plants and the need to finance them. Kind of like the stuff that the General Electric ( GE) makes. (I both work for GE and own shares in the company.) GE doesn't get talked about much, I think a legacy of the days when it was a hard-to-understand finance company that seemed to have a ton of leverage -- more than people realized -- and was more geared to Central and Eastern Europe credit cards (no thanks) than water infrastructure (thank you) and energy alternatives (with crude at $90 a barrel, thank you very much). That perception is wrong. People seem to remember that GE cut its dividend big-time. They seem oblivious to how it raised its dividend last year not once but twice. People seem to think that the company's still a finance company, that oh-so-funny "hedge fund in drag." Boy, is that ever NOT the case. Finance is back to financing. The portfolio, heavily reserved, it now looks like is too heavily reserved. During the heyday -- and after more than a decade in the wilderness, I now think we are getting back there -- I used to watch GE as a tell for where we were going. It is time to do it again. I am not allowed to own stock except for TheStreet.com ( TSCM) and the stock GE gives me for working at CNBC. Let's just say if I had to redo my contract, I'd sure wish I owned more common. You aren't restricted. What are you waiting for? The third dividend boost? Fine, it probably won't be that long from now! Random musings: Stay long coal. They are ALL undervalued. Even Consol ( CNX), which is pretty much universally hated...