NEW YORK (Real Money) -- 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 the E.U. deserves a big piece of the blame for the Greek mess;
- All the good news we're not paying attention to;
- Why its not time to start buying on this dip yet.
Click here for information on RealMoney, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.
The European Union Shares in Greece's Disgrace
Posted on July 1 at 4:18 a.m. EDT
Which would cost more: building a new defense against a Russian-allied Greece, or giving Greece a big break on debt that should have been marked down years ago?
I know what the answer was in 1947 -- give Greece what it needs to keep it democratic.
And we did.
Could it happen again now that Greece has to find some money somewhere as it is now an official scoundrel: It's in arrears on IMF debt -- Jeez, that's a rarity -- joining the ranks of Zimbabwe, a totally failed state. Its currency, if it had one of its own, would probably rate about the same level as Venezuela's. The country is a total disgrace among nations.
But it owes so much that the disgrace is really on the other foot. In this country, when we lent people mortgages with no documentation fully expecting that they couldn't pay, we did so with impunity because we knew that they could be rolled up and sold to Fannie Mae or hedge funds or whoever we could jam them to. The government came after those who made these loans and made the lenders cough up tens of billions in fines for their efforts.
In that sense, maybe Germany's getting off lightly. As I said earlier, when you lend someone 300 billion euros ($333 billion) it is your problem -- not theirs.
That's why I think the Union shares in this disgrace. Its high and mighty attitude toward Greece, knowing that the Greek house isn't worth nearly what they lent it for, isn't all that becoming.
In reality this situation is even harsher for the Germans than the bankers. The Germans have been huge winners in the euro; the Greeks huge losers. The Greeks should have cut and run years ago or the Germans -- notice I say Germans because these other countries seem not to matter at all -- should have booted them.
No one has a right to be high-and-mighty here.
So the saga continues, but I don't have a lot of sympathy for either deadbeats who take loans or those who give them to them.
There Is So Much Good News Out There
Posted on July 1 at 11:24 a.m. EDT
Things are happening that aren't even being noticed that are so positive they knock your socks off.
How much is Ace, run by the very smart Evan Greenberg, down on this deal? That would normally be the question. Nope, in this tape it's actually up four courtesy of the accretion of the deal and the transfer of Chubb's domicile to Switzerland, where Ace is based. The name Chubb stays, as it should, because Chubb's brand is pristine. As Pop always said, "Jimmy, use Chubb, they pay," meaning Chubb is famous for being there with the check the moment you need it. I always felt that I had done well in life when I needed Chubb. This is an amazing company and this acquisition is a stunner.
Of course, any consolidation is regarded as fantastic for the entire sector in which the takeover occurs, and this time is no different with Dow company Travelers (TRV - Get Report) ramping and Hartford (HIG - Get Report) rallying smartly. It's both a fever that more deals are on the horizon and a belief that pricing will tighten, making this cutthroat industry less competitive. I say be careful on that score. There are many different lines of businesses and I don't see any price relief coming. In this market, though, companies' stocks are innocent until proven guilty.
Then how about Fiat Chrysler (FCAU - Get Report) surpassing Ford (F - Get Report) in domestic sales, led by a 25% increase in Jeep sales. Auto sales remains red hot and they are a principal prop to the economy. Why don't the stocks move? Because they are all international and the rest of the world's not so hot, but if the market wasn't obsessed with Greece, we would be talking about this remarkable resurgence of a company that almost disappeared. (Ford is part of TheStreet's Dividend Stock Advisor portfolio.)
Then we are hearing that, at last, there could be a bottoming in the terrible casino numbers in Macau. These stocks, long popular favorites, have just been horrendous. But they are finally on the move and I think they could soar if we get any real relief from the declines. I have always felt that Wynn's (WYNN - Get Report) a great operator, but it's been a total avoid. That could be changing. Not calling the bottom yet. But getting there.
Finally, there's the housing call. Hardly a day goes by without one more housing-related stock going higher. Today is Stanley Black & Decker's (SWK - Get Report) turn, with a research note out that power tools could be up as much as low double digits this quarter. Makes sense: Housing formation will be the story of the second half, with only biotech takeovers rivaling the story. I like the homebuilders including Lennar (LEN - Get Report), Toll (TOL - Get Report) and Horton (DHI - Get Report), but I particularly am enamored of Home Depot (HD - Get Report) and Lowe's (LOW - Get Report), which are the single best plays on the beginning of housing investment as home price improvement dictates the spend and the spend is going higher.
This Is Still a Time for Selling, Not Buying in the Stock Market
Now that Greece has had a short-look at what a country without a currency feels like, there is some sort of change of heart going on that makes people more optimistic.
I think that's terrific and it would be great if there were a resolution. I still wonder why skepticism disappears so quickly and dissolves into a belief that all is well.
I say, if we get an opening this high and we get a fake-out this close to the holiday, then there will be a re-test that will be ugly and we will feel totally snookered.
That's why, if we are up like this, the logical thing to do is some small selling, not buying, because we were only down 2% yesterday, something that could have been realistic had nothing happened but Puerto Rican collapse.
Let's see what happens, but has the lesson not sink in not to be too optimistic about anything and anyone but Mario Draghi and his moves at the ECB?
I am sticking by the scenarios laid out earlier and betting that without a serious rally in the European bourses that were down more than 4% yesterday, selling beats buying unless you have something with an edge, like the biotechs -- Receptos (RCPT), Alder (ALDR) and Radius (RDUS - Get Report) -- that I laid out yesterday in light of the Celgene (CELG - Get Report) stake in Juno (JUNO).