Feels almost too good to be true. Once again, did we dodge the more than 3% to 5% decline? Once again have we put the trouble behind us? Did we have just enough October scare to inoculate?
I remember a week ago thinking there weren't enough "October's the roughest month" articles perhaps because those who wrote the "sell in May" and "sell in September" pieces felt chastised. I thought that the word had come from editors on high-stop being so bearish already.
But then by Thursday we were all well aware of the power of Rocktober and next thing you know people were whispering crash by Friday.
But then, in the span of 24 hours, an unemployment number comes out that is suddenly more important -- could have fooled me -- than the real labor number (Institute for Supply Management vs. monthly payrolls), oil, which looked low $60ish is now low $70ish, the dollar which looked $140ish on the euro is now looking $150ish, the market which had looked overbought now looks oversold, and Washington, which had looked askance about new job programs, now looks to be putting some sort of tax credit for hiring proposition. Next thing you know they will extend the tax credit for new home buying to everyone!
Then the four most important stocks in the market -- Apple (NASDAQ: AAPL) (Cramer's Take), Google (NASDAQ: GOOG) (Cramer's Take), Goldman Sachs (NYSE: GS) (Cramer's Take) and JP Morgan (NYSE: JPM) (Cramer's Take) -- all took off. Why are they important? Apple is the mobile Internet tsunami which has been hurt by successive declines in Research in Motion (NASDAQ: RIMM) (Cramer's Take) (justifiably), Skyworks (NASDAQ: SWKS) (Cramer's Take) (not conclusive and I disagree with the weakness) and Qualcomm (NASDAQ: QCOM) (Cramer's Take) where, somehow numbers had gotten too high (rectified).
Why Google? Because this company, I believe, will report numbers that show a great acceleration in growth. JPM and GS are the two strongest franchises in finance and they had led the financial rollover.
When you add in the forward progress made by Wells Fargo off the key Goldman upgrade, you can see how everything that looked bad a week ago now looks good.
I, for one, think all of this is too glib. I sold Monday, not bought, for Action Alerts PLUS. I want to take out $2 for every dollar I put in. I have a very high cash position for AAPLUS, the highest in a long time.
I didn't use last week's decline to put a lot to work.
Why? Isn't everything good?
Yep, that's why I don't trust it. I don't trust a market where everything is horrible on Thursday and everything's good on Monday.
Because in that kind of market, everything's bad by Thursday again.
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 was long Goldman Sachs, JPMorgan Chase, Qualcomm and Wells Fargo.
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Reader Comments (Page 1 of 1)
10-06-2009 @ 11:47AM
ebrandler34 said...
So Mr. Cramer,
Did you post this as a "token" caution sign that will somehow offset the relentless cheerleading posts you have on record for the past 45 days? (Not that you've been wrong, though)
All I've heard from you over August and September is "Buy the Dips", but today it's "raise cash"..... ???
This is where many people question your credibility. Can you please articulate what makes you so cautious today, having projected unbridled exuberance all this time?
Is this just manic-depression, or covering your bases?