A week ago it all seemed so inevitable. The bulls were in charge. The worst was over. I had to go on The Today Show, and I knew I would once again be asked about the call I made about how the stock market simply isn't going to be the place you want to invest in for money you really need, part of the radical re-evaluation of an asset class turned reckless, dangerous and joyless.
Worse, we had been up for four straight days, and there was a lot of that painful chatter about how "as goes January, so goes the year."
I found it all painful. This is a market that lets you divine no conclusions whatsoever about short-term performance of the market. It is true that we had solved the black holes of Wall Street, but Main Street's just beginning to haunt people, and that has the ability to derail Wall Street once again.
I said that any pundit who said this year is now going to be great -- and from what I could tell, the average plus notion was 20% for 2009 -- must simply be looking at everything but the data. I said I hoped the year could rack up a single-digit gain, which, considering the risk, puts this asset class well below municipals -- at least high-grade ones -- on the pecking order.
A week later, and look at this mess. Wall Street, supposed to be safe, was simply trashed, an obliteration led by Citigroup (NYSE: C) (Cramer's Take) and Wells Fargo (NYSE: WFC) (Cramer's Take) with an unhealthy preannouncement from Bank of America (NYSE: BAC) (Cramer's Take) thrown in.
We had a grinding decline, once again, of the oil leadership, which led to a full-scale implosion by Friday, even as people kept trying to run up the Oil Services HOLDRs (NYSE: OIH) (Cramer's Take) and Transocean (NYSE: RIG) (Cramer's Take) as well as Exxon (NYSE: XOM) (Cramer's Take). The group, I believe, has further to go on the theory that Chevron's (NYSE: CVX) (Cramer's Take) not an outlier -- that was ugly.
Meanwhile, we are interregnum stalled here, waiting for something to happen other than a back and forth about the absence of a senator -- trumped by the absence of a wide receiver of roughly the same name this weekend!
I worried last week because we were overbought, and my rules demand that I forgo some of the best part of any rally because once it gets severely overbought, you are severely history.
Now we are looking at crummy earnings and lowered estimates all week. The inevitability of the decline is now upon is.
By the end of the week, we will probably have to take the other side again. Always with the idea of being opportunistic, never with the sense that we are out of the woods.
Random musings: Adam Feuerstein could be the go-to guy this week with the health conferences. ... People in search of personal finance info should be bookmarking MainStreet.com, which has come on strong here and is developing into a must-read site for things saving, budgeting and un-paid-for 401(k) advice, if you know what I mean.
Jim Cramer is co-founder and chairman 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 had no positions in the stocks mentioned.
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Reader Comments (Page 1 of 1)
1-12-2009 @ 10:04AM
nick said...
Crammer still waiting for that boat load of cash you said I would get if I put my money in WACHOVIA? What is the next sucker move you got, betting on the CEO of GE getting fired? Want us to plunk alot of cash in Capital?
1-13-2009 @ 9:36AM
NICK said...
Crammer reminds me of Biden, they both use other peoples work to get by on. Crammer is the big lap dog for CNBC and their slime boss at GE.