TheStreet.com's Jim Cramer says that as long as we're trapped in a commoditized stock market, use the futures to go bargain-hunting.
What if individual stocks want to go up, but the market wants to go down? Don't laugh. In 1982, when The Kansas City Board of Trade started trading Value Line futures (before there were S&P futures), we used to kick around in securities classes what would happen if eventually stocks became so commoditized that individual companies couldn't be removed from the gravitational pull.
For example, we know today looks like a terrible day, with Europe down horribly and our futures real soggy. But then we look and see that J. Crew (NYSE: JCG) (Cramer's Take), one of the best retailers, is not just saying that the fall season is good; it is saying it is blowout beyond imagination. The big Dow stock 3M (NYSE: MMM) (Cramer's Take) is not just saying that things are getting better; it is showing that business is very strong. The monster insurer and fellow Dow stock Travelers (NYSE: TRV) (Cramer's Take) is boosting the dividend and showing you how a responsible financial can behave.
All of these stocks would be shoe-ins to go higher, but they are part of the commodity gravitational pull. Of course, I think that the best way to deal with this phenomenon, as we have learned, is to let the futures get you into great stocks at better prices. But we have to accept that, at least for the moment as we look at the morning futures, none of these individual company's triumphs matter because we have gotten trapped in a commodities vortex oil-dollar-S&P 500 that's the worst I have ever seen since the creation of futures that treat stocks like they are all corn, soy, or wheat.
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)
10-22-2009 @ 10:26AM
Jennifer Dajo said...
Has anyone seen the movie Jim is in called "Stock Shock-the Short Selling of the American dream?" Here is an article about it. http://www.prlog.org/10384356-cnbcs-jim-cramer-demands-sec-protection-in-the-financial-film-stock-shock.html
10-22-2009 @ 1:12PM
Iridium said...
Well wealthy people shop at J. Crew and a lot of wealthy people have done very well this year.
J. Crew also forces it's employees to wear J. Crew clothes. Many times the employees have to use a J. Crew credit card to purchase the clothes and go thousands of dollars in debt just to be able to work at the store.
J. Crew really isn't a good company. They won't hire people that they don't think will fit thier image based on the clothes they wear. Just like Buckle.
If you are a size 8 or above girl don't even think about applying at J. Crew of Buckle.
If you want to see the real retail picture go to a Macys or New York and Co. These stores already are having 75% off sales for collections that came in during October. They still have racks of summer clothes they can't get rid of. I bought a $200 summer sportcoat at Macy's yesterday for $14.99. There were still 10 others on the rack.