After a 37 point drop in the Dow and 10 points in the s$p cramer says stocks are on sale. Hahahaha. Stocks are up hundreds and hundreds of percent and he thinks this is a pullback.
Cramer: Stocks Are on SaleBuy, Buy, Buy
CNBC.COM_|_January 12, 2010_|_8:22 PM EST
âThis market needed a breatherâ from its big 10-month run, Cramer said during Mad Money, and on Tuesday âWashington provided a terrific pretext.â
News that the White House wants to tax banks was just what Wall Street needed to start a sell-off, one that took the Dow 37 points lower and cost the S&P 500 almost a full 1%.
The US economy canât recover without the banks, Cramer said, and President Obamaâs renewed focus on the sector â for unpaid Troubled Asset Relief Program loans and excessive compensation packages â makes its tenuous situation even more tenuous. Americans need access to credit, and taxes would further diminish an already reduced supply. Investors saw the potential danger and took the group down accordingly.
But make no mistake, Washington provided a bit of a convenient excuse to take profits. Letâs face it, the market canât surge 3% a week without an eventual pullback. And thatâs why the materials and agriculture companies declined right along with the banks. Still, Cramer emphasized that this was a typical pause in an otherwise bullish environment for stocks.
For one thing, he saw a silver lining in Alcoa âs<cnbcquote><![CDATA[(AA)]]></cnbcquote>more or less disappointing earnings report : âsome pretty amazing cash flow numbers.â Cramer predicted a big 2010 for the company, saying a turn is coming in Alcoaâs key markets. He thinks AA is a buy.
Also, those materials stocks â the coppers, steels, and mining-equipment players â fell because investors feared a slowdown in China . But Cramer is OK with that. Heâd rather see the country grow at a manageable pace instead of one so feverish that the government steps in. A complete shutdown by the Chinese Communist Party is a much worse possibility.
Today also saw a pullback in corn and oil , and Cramerâs all right with that, too. Inflation can kill a stock rally, so a softening in commodity prices is sometimes welcome.
Lastly, the Nasdaq, up 44% in 2009, also needed a rest . A continued move like that would too closely resemble the dot-com bust of 2000. Better for the index to pause now than end up giving all of those gains back.
âThe marketâs throwing a sale,â Cramer said, and investors should take advantage.
Cramer: Stocks Are on SaleBuy, Buy, Buy
CNBC.COM_|_January 12, 2010_|_8:22 PM EST
âThis market needed a breatherâ from its big 10-month run, Cramer said during Mad Money, and on Tuesday âWashington provided a terrific pretext.â
News that the White House wants to tax banks was just what Wall Street needed to start a sell-off, one that took the Dow 37 points lower and cost the S&P 500 almost a full 1%.
The US economy canât recover without the banks, Cramer said, and President Obamaâs renewed focus on the sector â for unpaid Troubled Asset Relief Program loans and excessive compensation packages â makes its tenuous situation even more tenuous. Americans need access to credit, and taxes would further diminish an already reduced supply. Investors saw the potential danger and took the group down accordingly.
But make no mistake, Washington provided a bit of a convenient excuse to take profits. Letâs face it, the market canât surge 3% a week without an eventual pullback. And thatâs why the materials and agriculture companies declined right along with the banks. Still, Cramer emphasized that this was a typical pause in an otherwise bullish environment for stocks.
For one thing, he saw a silver lining in Alcoa âs<cnbcquote><![CDATA[(AA)]]></cnbcquote>more or less disappointing earnings report : âsome pretty amazing cash flow numbers.â Cramer predicted a big 2010 for the company, saying a turn is coming in Alcoaâs key markets. He thinks AA is a buy.
Also, those materials stocks â the coppers, steels, and mining-equipment players â fell because investors feared a slowdown in China . But Cramer is OK with that. Heâd rather see the country grow at a manageable pace instead of one so feverish that the government steps in. A complete shutdown by the Chinese Communist Party is a much worse possibility.
Today also saw a pullback in corn and oil , and Cramerâs all right with that, too. Inflation can kill a stock rally, so a softening in commodity prices is sometimes welcome.
Lastly, the Nasdaq, up 44% in 2009, also needed a rest . A continued move like that would too closely resemble the dot-com bust of 2000. Better for the index to pause now than end up giving all of those gains back.
âThe marketâs throwing a sale,â Cramer said, and investors should take advantage.
