TheStreet.com's Jim Cramer says the safety theme will come back if only because these companies' earnings will be good in six months. Editor's note: Jim Cramer will present his 2009 stock outlook for the first time at TheStreet.com Investment Conference on Saturday, Oct. 25. Click for details.
Now they come after the Procter & Gambles (NYSE: PG) (Cramer's Take) and the General Mills (NYSE: GIS) (Cramer's Take) and the like, betting that the action will be better in the cyclicals with all of this money being printed worldwide.
Commodities are also coming back because of reflation. And we have to feel that many of the infra and ag names are finally sold out by the hedge fund redemptions.
Here I am speaking of a Freeport McMoRan (NYSE: FCX) (Cramer's Take), with its good yield and a belief that the hedge funds are at last done.
I don't buy it. I like a balanced portfolio, but I want to buy the GIS/PG all the way down because we are going into a recession, not going out of one. These companies pay dividends, raise dividends and have great commodity tailwinds.
Colgate's (NYSE: CL) (Cramer's Take) down a lot too, and I am liking that one.
I know they have fallen out of favor because everyone was hiding in them, but I really think that these stocks are banks, just banks that can self-finance, and that's a real positive.
I would not be surprised if they kept coming down, but I would buy them down all of the way. They aren't going away ... unlike everything else these days where you can argue bankruptcy for many is coming in a recession.
Safety will come back as a theme if only because the earnings of these companies will be good six months from now. I can't say that for a lot of other companies for certain.
Random musings: More nonsense from commentators: When are the private investors going to show up, and isn't it time for the government to step back? They obviously don't know that the Great Depression is on the table and the private sector isn't big enough. ... XTO (NYSE: XTO) (Cramer's Take) down so badly on an insider sale. Chesapeake (NYSE: CHK) (Cramer's Take) is insider buying and nobody cares. Check out that Chesapeake convertible preferred. That's a winner. ... Hedge fund names Monsanto (NYSE: MON) (Cramer's Take), Jacobs Engineering (NYSE: JEC) (Cramer's Take) and the like, finally going up. Tells you the sellers are done. ... They are forcing KeyCorp (NYSE: KEY) (Cramer's Take) and Sovereign (NYSE: SOV) (Cramer's Take) to go to the federal government. ... Aflac (NYSE: AFL) (Cramer's Take)? Is that one short of capital? ... Lot of people still pillorying me for saying on Monday that you should take money out of the market. Maybe they are not worried about Citigroup (NYSE: C) (Cramer's Take), GM (NYSE: GM) (Cramer's Take), Ford (NYSE: F) (Cramer's Take), Morgan Stanley (NYSE: MS) (Cramer's Take), Comerica (NYSE: CMA) (Cramer's Take), Sovereign, Prudential (NYSE: PRU) (Cramer's Take), Hartford Financial (NYSE: HIG) (Cramer's Take), MetLife (NYSE: MET) (Cramer's Take), Principal Financial (NYSE: PFG) (Cramer's Take), Ameriprise (NYSE: AMP) (Cramer's Take), Bank of America (NYSE: BAC) (Cramer's Take), Wachovia (NYSE: WB) (Cramer's Take), XL Capital (NYSE: XL) (Cramer's Take) and some others.
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RELATED LINKS:
Cramer: I Was Too Bullish
Balance Sheets Matter Now More Than Ever
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Jim 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. At the time of publication, Cramer was long Freeport-McMoRan, General Mills, Procter & Gamble and Morgan Stanley.
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Reader Comments (Page 1 of 1)
10-10-2008 @ 9:50AM
Jim said...
Sometimes I feel like Cramer is somewhat akin to a "tout" at a racetrack.They pretend to know which horses will win.If you pick enough stocks one is bound to be a winner.
10-10-2008 @ 11:39AM
Sheldon L said...
I was one of the guys picking on Cramer this week but...
He is ABSOLUTELY RIGHT that you can buy certain diversified companies selling small consumables like General Mills and P&G into the ground (where they are not going).
10-10-2008 @ 11:52AM
beachpaul said...
Calm down. There are about to be some tremendous buys. The hedge clippers are bailing. Warner Music will be back to $4.50, where the hedges knew it was a great buy. It is again. TWX under $10.? A grand theft! Big Bussiness had a great run. Why should I have to see a dealer, put his kids through a private school, watch his wife drive a new car every year, free lunches, gas all on a company card when I should be able to buy the car I want off the internet from Ford? Why? Ford at $2! I'll take 5,000, thank you! You don't get it. Inflation, deflation, bull! It is the internet! Didgitalization. It brought the music industry business model to it's knees. Now it is ravaging everybody else! It is time for a change. About time!
10-10-2008 @ 9:15PM
monique baugus said...
Jim, please explain what you meant by "I DONT BUY IT" Buy what? that the hedge funds are or arent done? do you like commodity FCX and such? I am confused. Also I owned PG and still do for 20 years, since 18. I am 43. IN 2006, I had enough with splits and dividends to buy a nice home!! I was shocked! So monthly, I think it's wise to have a DRIP ...and where you have to send them the money ...not online, it's too easy to get nervous and run to computer and sell! It's nice when it's tucked away,,not CHK!! I dont know if these will ever ever come back. I am a chartist. But PG and JNJ, yes, they WILL COME BACK ...
But, my neighbor owns all CHK ! He si 76 . We told him to buy it wheny you went wild over gas, such as PDO and MDX and such highfiyers, HK you recommended FOR ONE WHOLE WEEK< ONE ENTIRE WEEK DEVOTED NIGHTLY AND DURING THE DAY EVEN ON THESE GAS COMPANIES, some going out of business, or at least price reflects that! GOD, now they are all all all so down...I showed my neighbor the chart.He said "it wll come back. Then tonite, to hear that the CEO, who I love, and always bought after him, except this last time, I knew (By my CHART) that it was a broken stock, not a broken company
So for the record, are you still recommending agriculture like POT (wht Canadian money, and also the price of commodity will NEVER go that hight again)..THat was insane, going up 400 percent or more, all of these. EVEN SQM I loved! But got caught in that..
SO explain yourself a little bit more, please.
And should we now short CHK, due to it's going under due to CEO and margin call and HE BROGUHT PRICE DOWN,,,what a shame, Why didnt he warn my neighbor!! THAT WAS HIS ENTIRE INCOME!! I told him to diversify, but he's old. HELP!A fan, but cynic
Mo
10-11-2008 @ 9:57AM
towncrier said...
this is the time to dollar cost average into the best corporate stocks on a weekly or monthly basis for the next 1 to 5 years. pick ones that you think will survivers with absolutely necessary and needed products. a good dividend, not subject to drastic cuts is a plus when deciding.
this economy and stock market is broke and needs to be repaired. untill that happens, no one can call a bottom and the only defense is dollar cost averaging.
10-17-2008 @ 5:27PM
Bassett said...
I bought 400 shares of lmc at 14.70 at your recommendation over a year ago.what do you suggest i do with it now?