NEW YORK (TheStreet) -- Jim Cramer fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he blogged on:
- Why restaurants and retailers are the winners of the moment, and
- The full faith and credit of higher profits and better growth.
Click here for information on RealMoney, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.
It's Not Safe to Buy Oils Yet
Posted at 11:17 a.m. EDT on Friday, Nov. 28, 2014
The consumer goods plays and the consumer spend plays are all acting as if numbers are way too low.
I can see that for the restaurants and retailers. Anyone who was doing well before this is doing better. But I am shocked at how fast the consumer goods plays, particularly, stock like Procter (PG) , are performing because those are companies that won't see the benefits for a couple of quarters because they are hedged or because the cumulative declines they are experiencing in packaging and gasoline may not matter this quarter. They are really baking in a terrific 2015.
Now the oils are simply in freefall and I think that they are going to levels that make me feel there is no way yet you can buy them because WE HAVE NOT HAD THE NUMBER CUTS YET. There will be no way to figure out where they are going until the cuts happen.
For example, do you buy an oil with a safe dividend of 6% knowing that it can't protect you from a 10% decline from here? I think that's really the risk/reward. All I can say is that if an oil is at a two-year low and it yields 6% or more, I find that mighty tempting.
The drillers are disastrous, again, until budgets are cut and they must all be cut below $70.
The total collapse of many of the chemicals -- because of an attenuated decline in their ability to charge higher prices if oil is down -- seems a little overdone, but again there will be number cuts, too.
The market's acting rationally overall, but the exacerbations in light of the Saudis carrying the day and the lack of oil demand, or at least ability to store oil at what are thought to be low prices, is pretty shocking. Have to let this all settle, though, before you pick -- and you can only pick among the most hedged. Too early. Still better to buy retailers and restaurants, the true winners for the moment.
At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, had no positions in the stocks mentioned.
What Really Drives This Market
Posted at 3:40 p.m. EDT on Tuesday, Nov. 25, 2014
So that's why we rallied!
That should have been your reaction to this morning's amazing 3.9% growth in gross domestic product for the third quarter, giving us the fastest growth we've had in 10 years. That's a monumental turn and, while I typically don't care about these broad "macro" numbers, this one is so encouraging I think it's worth discussing.
First, when you have a run like we have had in this stock market, it had better be backed by something. This isn't a Fed-inspired rally any more, one where we like certain stocks for their bond market equivalence. Sure, those stocks are hanging in but they are not generating the performance they once did. In fact, they have been left behind by the rest of the market despite their terrific yields relative to the 10-year Treasury, the oft-compared alternative.