This market keeps defying the bears

Given the dramatic run that rests on positive news only, it's time to trim.

By Jim Cramer Sep 12, 2013 9:31AM

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Red Arrow Pointing Upward © Fotosearch, Fotosearch, Getty ImagesCan the Standard & Poor's 500 ($INX)  actually go up for an eighth straight session? That would make for the longest winning streak since the beginning of July, when the 10-year U.S. Treasury at last settled in after a wild ride. Can the market really be on the verge of taking out the early August high that is tantalizingly less than a point-and-a-half away from the current level?


Sometimes I think that I shouldn't even bother to ask anyone because this market just defies and defies and defies the bears, and is climbing the steepest wall of worry I can recall in recent memory. No, it is not as dramatic as the wall scaled after the financial meltdown, the climb that began in March of 2009.


But it is dramatic nonetheless, and it rests on two different pillars. First, it only sees what's good, and not what's bad, or it spins the bad in a good way. Second, when domestic issues get rough, it shifts focus to something that's positive globally -- and vice versa.


Wednesday, for example, was a quintessential day in this bizarre bull run. Instead of fleeing the homebuilders on some incredibly horrendous mortgage-applications number, bulled-up investors bought these stocks, betting that the worst must be over. Talk about turning a negative into a positive. Meanwhile, not since 2008 have we decided that China has now trumped our own ability to move the cyclical needle. Ever since the Baltic Dry Freight Index bottomed in August and has never looked back, we have seen industrials catch bids in any moment when there's been dramatic stock-market weakness.


So who am I to say that now, with some Syrians firing missiles at Israel's Golan Heights (did anyone not see that coming?) that the market will at last break its winning streak?

We saw some truly terrible numbers Wednesday night from Vera Bradley (VRA) and Men's Wearhouse (MW), on top of cautionary guidance from PVH (PVH) and hideous outlooks from Francesca's (FRAN) and Jos. A. Bank (JOSB). Despite this, though, for all I can tell that someone will see a silver -- not moth-infested -- lining in the apparel stocks. Maybe they will just go buy shares in TJX (TJX), the closeout company, to exploit the trend.


To me, it is again time to trim into an overbought stock market, something we have done pretty much every single day this week for Action Alerts PLUS. Believe me, we would do even more trimming if we weren't so darned restricted in the stocks of so many companies, as we tell subscribers in our alerts every day.


That said, I know this: Even after the market roared up eight straight sessions in early July, you didn't get the reckoning until August.


Somehow, I think this time we could be in for a quicker selloff when the streak is broken, given that we have seen some serious deterioration in both the home and retail-apparel sales departments. But that's been a "too-cautious" outlook for days now. In the end, you always have to go with the disciplines that brought you here, and we are not buying anything for the trust, at least until we raise even more cash. Anything else just seems imprudent, given the amazing run that the cruelest month has already given us.

 

cramer

 

 

Jim Cramer is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for Action Alerts PLUS, which Cramer co-manages as a charitable trust and is long PVH.

 

 

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87Comments
Sep 12, 2013 10:49AM
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NTU in case you miss my reply in the thread below.
Doesn't much matter who Obama pissed off, he isn't running again and won't ever again.  If they get the chem weapons out of Syria without firing a shot I say good for Putin.  As far as playing, well Putin put his credibility on the line now, if they can't actually get the chem weapons out, no one will trust him again.   Anyone who thinks Putin is cleaning up corruption is a fool, he takes a profit from it.
As far as morality, that's not for me to judge, there are some things everyone can agree on, and some we can't.  I used to be anti gay marriage, until I met a couple in Toronto, they adopted a young 3 year old girl, she came from an abused home.  She now lives in a home with 2 parents who love her more then any thing and they happen to be 2 of the most kind and generous people I have ever had the pleasure of meeting (they are the neighbors of relatives in Toronto).  I see no reason why 2 individuals who love each other and are great people can't have the exact rights as everyone else.
Sep 12, 2013 1:50PM
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It is funny to see the same thing happening with Auto sales, School Loans and Credit Card debt that happened with Housing...... Not enough consumers to satisfy the greedy no problem lower the bar and sell ..... sell...... sell. When the shlt hits the fan........ Woops.. We need a bailout. Guess what responsible tax payers... You were once again an un-willing consumer to suit the greedy pigs by using the useless hoard...... Ha Ha Ha...... what a joke.

 

 

Sep 12, 2013 10:30AM
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the market may simply be seeing a slow continous drip of money flowing in no matter what the market looks like. 

 

people who yanked their 401K money OUT a few years back are now stepping back into the pool.  either moving cash from safe to "risky", or simply restarting the funds with their employers. 

 

so much of how the markets grew in the 80's when 401K's and IRA's were basically born, it's simply the flow of new money in that raises the markets.  not a function of fundementals.

 

trouble happens when CEO's think they are gods and think their actions are actually the REASON for the markets to go up

Sep 12, 2013 2:52PM
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"Obama resigning in disgrace..." .....

If howdy doody did not have to resign after "mission accomplished" then why in the hell should President Obama.

President O. is a genius .....he basically told aipac the saudis the qataris and the zio-neocons to go f *ck themselves and shove their well laid war plans up their well laid @ssholes ......he pushed the issue back to congress and shone a light on the nonsensical rationale for yet another march to war.

Putin may have to pay a price next year at the Sochin games but being aware beforehand will hopefully mean they are ready to deal with whatever scumbags the saudis and qataris send their way to make mischief.

If we do strike syria it will be clear that the office of POTUS holds no real power.
Sep 12, 2013 10:16AM
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I will bet you my Treasury and Federal Reserve full reconciliation against your fake Bull Runs every day and on Sundays too... you will lose. Few people really care about the Exchange levels any longer, they are wholly focused on which weapons to use when we overrun DC, NYC and other meccas for train wrecks. The privileged class went too far. They will be eaten.
Sep 12, 2013 12:38PM
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Fat Cat's only form of entertainment are these chat boards.....and his grey poupon on a lonely night.
Sep 12, 2013 12:22PM
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Yes, Fatty.....I stuff Miss Lilly, "once in a while."

 

The Weirdo I was referring to, was YOU.!!

 

Good investing to all...

Sep 12, 2013 2:57PM
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Sold my NOK today ...bought at $1.78 sold at $6.45 .!!! Woo hoo .....

And btw although cramer is claiming this one as a win ....(he jumped in when it was around $4.50 or so) ....he said stay away when it was around $2 ....in fact he poured scorn an anyone who would own it !!

Staying in cash till December !
Sep 12, 2013 12:23PM
Sep 12, 2013 4:29PM
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"Five years after the worst of the financial crisis, the world has not yet come close to building a "harmonized, robust" market for over-the-counter swaps, a top U.S. Federal Reserve official said on Thursday. New York Fed President William Dudley said in a speech he is concerned that OTC derivatives reforms have been delayed and will fall short of a broader revamp of financial markets in the post-crisis era. The Basel Committee of regulators and central bankers are forcing the mandatory clearing and on-exchange trading of OTC contracts where possible in the 20 leading economies, or G20, and for all transactions to be recorded. Last week, new rules meant to make the $630 trillion market safer were eased to avoid harming economic activity, as some banks have argued. Despite the slow progress, Dudley said regulators may need to push even harder to ensure enough derivatives become "standardized" and freely traded as opposed to "bespoke." As well, the venues that clear the trades, known as central counterparties, must comply with all global rules, and so-called trade repositories must have all trading data available.

"The OTC derivatives reform effort fits in very well with the broader reform agenda, but there are significant risks that we will fall short in this arena relative to what we are likely to achieve elsewhere," he said in prepared remarks to a derivatives conference in Paris. Dudley, whose branch of the Fed directly oversees Wall Street, acknowledged that swaps rules are more difficult to implement than bank-capital rules, for example. But as it stands, he said, the Fed and other regulators cannot determine the amount of risk that remains in the system, or how secure is its infrastructure."

 

I wanted to post this for all readers who are tired of MF Cat trashing my posts. JUST the US share of derivative exposure is $630 TRILLION now. Globe wide... paper & electronic currencies, debt instruments and derivatives FAR EXCEED $1 quadrillion now. We haven't had an economy in at least 5 years and without one, we cra**** a guaranteed inevitability. For the narrow and closed minded... derivatives have never been reconciled, so they very well contain fake and dark pooled money. Derivatives PRIORITIZE ahead of stocks, bonds and secured positions. If you haven't grasped what I've been saying since 2009... YOU have nothing... nada... stocks cannot liquidate- the bonds for redemption are worthless and everything else including real estate and metals isn't worth anything without viable currency. Sell now FOOLS... better to drive a burning car into the river than to go crispy while it is artificially forced to continue down the road. 

Sep 12, 2013 10:37AM
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 "firing missiles at Israel's Golan Heights" ....

2 Things .....first of all the Golan Heights are syrian but mainly occupied by israelis .......and secondly from the Jerusalem Post .....

"Two mortar shells fired from Syria landed in the southern Golan Heights adjacent to the Israeli-Syrian border on Thursday.

Initial evidence suggests that the shells were a result of errant fire from Syria's civil war that accidentally entered Israeli territory, the IDF stated."


Apply some rigor to your journalism ....remember you are not supposed to be a shill for dershozitz and peretz anymore !!

Sep 12, 2013 12:08PM
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Why is the Dow down?  Good economic news is everywhere ... I am shocked ...shocked! MSN says the market has run out of steam ... that is a good reason!!! 

Will this dishonest manipulation ever end?
-- No Syria war,
-- Taper now and get it over with.
Sep 12, 2013 11:51AM
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Market defies the Bears = Wall Street/Crime Street ! To the To Big To Fail   To Big To Jail   DIE BANK OF AMERICA DIE !
Sep 12, 2013 2:24PM
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American debt is declining .. wonderful news today..  It will boost markets. Oh, I forgot. Traders who are manipulating the markets, want bad economic news.  This cesspool that makes up Wall Street manipulates news for profit before thinking of the  well being of the Nation.
Sep 12, 2013 12:27PM
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Trends in a manipulated Market can turn on a dime. Normally, without the QEs to infinity, most times trends like increasing truck sell meant the economy had turned a corner. These aren't normal times. Therefore relying on past trends is fool's gold.
Sep 12, 2013 4:35PM
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Howdy Doody should have resigned several times, but made Himself a War President for "all the wrong reasons."

One of his objectives was to stay in office and make many he owed favors to....Rich.

That was his "only" ....."Accomplished Mission".

 

Americans do not like or want change, with especially our Children in harms way...

But as usual, it took several years for our Citizens to realize we were throwing money and lives down a shidthole or into a rat's and flea infested nest.

Now they blame the wrong person for the troubles that were started by GREED and REVENGE.

I will never forgive the "former" for that; And yes, "I was agin' him and not fer him."

Sep 12, 2013 4:12PM
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The Market defied the Bears until today ... today traders began manipulating QE tapering again. They make Wall Street proud.
Sep 12, 2013 12:21PM
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Jimmy, it's not the Bears that are shocked, it's the Bulls. It's not hard to figure out with Global FEDS printing money and borrowing cost for Big Money at or near all time lows. There are likely more companies buying back Stock now than Real People actually investing in them. Then you have the manipulations of frequency trading along with Record Stock buying on Margin. The Bears have figured this out, clearly the Bulls have not.

So in reality the Markets aren't defying anything, YET. But oh when it comes time to pay the piper, Jimmy will be singing an entirely different tune. His first words will be, but nobody saw it coming, when in fact, almost everyone saw it coming.

Sep 12, 2013 9:51AM
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Whats the old saying about a fool and his money?

Sep 12, 2013 12:48PM
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There is no "market" any longer, it´s all in the hands of a few manipulators. Everything is artificial, thanks to Bernanke, who extinguished the concept of "price". Good riddance.
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