It's time to talk about what did and what didn't happen when people came back from summer vacation.
First, what didn't happen. We didn't get a lot of selling by firms that were up a lot. We didn't get a September lock-in of gains -- too many funds behind the market, I imagine, too many funds where it would be too costly to get out. They didn't go away in September like they were supposed to.
Second, we didn't get the preannouncements that should have happened if the economy was already starting to wind down and nobody was buying anything. Housing didn't slow down after a California tax credit went away.
All traffic numbers I received from major retailers indicated that September has been stronger and August finished above plan so there were no readjustments to the downside. A weak dollar is making it so many companies feel better and aren't worried about hitting their targets, even if they are reduced.
Third, tech, which has now finished a destocking/restocking cycle, is growing in orders again, and strongly. That means when semi inventories went too low, people started ordering, but they didn't stop ordering when inventories got back to normal. And they hired outside contractors like Flextronics (NASDAQ: FLEX) (Cramer's Take) and Celestica (NYSE: CLS) (Cramer's Take) to build more inventory for them. You need to look at my four-part piece on this to understand how important this is.
Fourth, some tech orders have accelerated dramatically. One company that many analysts said was simply playing the restocking wave was Skyworks Solutions (NASDAQ: SWKS) (Cramer's Take), a tech company that makes souped-up cell phone parts for smart phones, among other phones. Its orders so accelerated that it took the stance that it had to tell people because its last estimates were just way too low.
That's a very, very big deal.
We didn't see the big drop-off in auto sales, post-"Clunkers," that everyone forecast. Instead, they still don't have enough inventory because they budgeted for 8 million cars sold and it is looking like it will be 10 million.
We didn't see further degradation in employment, the lone great bear story left.
Most important, while retail investors and small advisers turned bullish, hedge funds seemed to go overboard on the negative.
I see and hear no one who says, "I am a believer, I couldn't leave the bull if I tried."
Instead I see people fomenting new theories, new indices, new tells, new commodity theories that simply haven't worked and don't work in this kind of a market.
I wish others saw this stuff, too. Don Dion and Dan Fitzpatrick have, and it is great to have anyone see eye to eye with me.
But for the most part I feel I have been right, except when I write here!
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)
9-11-2009 @ 9:54AM
Ethan said...
No, you're a cheerleader.
9-11-2009 @ 10:21AM
Warren said...
"No, you're a cheerleader."
So show us why you believe that. A drive by insult doesn't mean much if you don't back it up.
9-11-2009 @ 11:05AM
ebrandler34 said...
I suspect that Ethan believes that the equity markets are juiced and frothy based on a monetized debt "sugar high". There are now too many people "invested" (both figuratively and literally) in the storyline that everything is fixed (or fixing) now.
You have politicians, who desperately want the "all better" narrative to take hold before the 2010 elections.
You have the deepest pocket, Wall St. types, who had the courage and fortitude to buy in March and April, needing shills and cheerleaders to coax money off the sidelines in order to multiply their returns (as the first players in the pyramid).
You have the CNBC media types that need to reinforce the notion that stock market "investing" isn't stacked against the home-gamers, having become little more than an upscale casino.
and lastly, Cramer's "in your face" bravado (which in all fairness is partially justified by his calls on both the downturn and the pivot point back in March).
In summary, the Fed and many major governments must cheer this market on, otherwise inflation will rear its head (not if, but when) and interest rates will spike, thereby collapsing the ponzi scheme altogether. So Cramer wittingly or unwittingly has taken a prominent position in the bull cheerleading section.
Is that well-articulated enough for you, Warren? Personally, "You're a cheerleader" was just as effective.
9-11-2009 @ 12:28PM
Warren said...
Yeah.
You know what I've learned in my years of investing? Nobody knows anything. Everyone has an opinion and they're all wrong - except for those rare occasions where they catch lightning in a bottle and happen to guess something correctly. That happens once in a while but generally everyone just flails in the wind with their "expert" opinions until the next big thing hits and everyone acts surprised because nobody saw it coming.
And random internet commentators? Those predictions are the worst. A track record that nobody could be proud of.
But, despite all of that, they dish out their opinions as though they are the only ones who have actually figured out how things work - and then when the market doesn't do what they said it would, they ignore that and come up with new opinions and the cycle repeats.
In other words, please STFU.
9-11-2009 @ 6:43PM
rpgpa said...
You guys cant write and write... while JC does provide some insight and some interesting angles. your a complete fool if you trust anyone in the GS frat house. PERIOD