This article originally appeared on Jan. 27, 2014, on RealMoney.com. To read more content like this plus see inside Jim Cramer's multimillion-dollar portfolio for FREE... Click Here NOW.
NEW YORK (Real Money) -- On Jan. 1, 2014, all of the notable strategists explicitly outlined a pullback in stocks in January. Better still, they suggested it could occur at some point in 2014. Well, unfortunately, I have a dose of bad news to report: They didn't.
How do I know this? I went back and combed through all of the "2014 Roadmap" PDF docs that flooded my email inbox in December. Then, I made a list of buzzy economists and strategists and watched interviews of them until 1 a.m. on Sunday. Hey, you think I got ahead in life by sitting on my behind, following the crowd and partying it up on the weekend? Guess again.
This particular strategist forecast a spring 5% to 7% retrenchment in the markets, so in that regard, I am a touch surprised to see this timetable apparently sucked forward. The premise for my correction call was these four factors:
1. Bad, surprise-ridden underbelly of the U.S. economy. This underbelly is bringing indigestion to national retailers, and could impact the financials of transports (most notably logistics companies) in the first half of 2014.
2. Artificial expectations on an impending capital expenditure boom. "Flush" with cash or not, corporate America has given us no indication, either with actions taken on balance sheets or in earnings calls, which they are poised to reinvest aggressively for the future. All of the language I hear is a "focus on productivity" and "restructuring benefits." Companies appear content to sit on low-yielding cash (most of which is held overseas) or use it to line the pockets of execs nearing the end of an employment contract via share repurchases.