Don't abandon this market
Just wait until stocks fall to more attractive prices.
So we would go in to the office at the old hedge fund today, and I would start our 6 a.m. meeting with a simple view: "Why aren't we 100% short?" Why should we own anything?"
That's how I feel as I log on to the PC today. Why own anything? Why not be 100% short? The economy is getting weak; the debt ceiling is irreconcilable; Japan will never get its act together; taxes are going up; earnings are missing estimates; President Barack Obama is about to speak, which will be dreadful for stocks; Elizabeth Warren is about to be banking czar; China is slowing; and if oil goes up, it causes demand destruction, but if oil goes down, we've had demand destruction -- just like 2008.
What is the point? Sell everything?
If I consistently came to you and said to sell everything no matter what, I think I could far more easily justify that position to you than to say there are some things worth buying at a price. I could blast right back at all of the critics with a simple riposte: Just you wait. When the market goes down big this week, as will happen with one day in expiration week, I could do a big "I told you so" and spit in the eyes of my detractors, even if the big down day came from a much higher level.
So satisfying. So smug. So delicious.
But just so unhelpful. Still, that’s irrelevant when you are trying to make a point of looking intelligent.
Instead, though, I am going to choose to be no more than mildly pessimistic, and that's about it. Take Alcoa. The company didn't do as well as I would have wanted. Amazingly, that's actually the fault of Alcoa, not me. Yep, incredibly, the company didn't live up to my expectations, and my expectations, remarkably, aren't what's wrong. It isn't me! It's the company! But I am not going to abandon it -- not like I did with Alcan after a couple of tough quarters, only to watch it get a monster takeover bid.
I am not going to abandon the market. I am just going to wait for better prices. I am not going to make a grand sweeping statement that we have seen the highs or that everything stinks or that it is all over.
I am simply going to say I don't like the market, but I would like many of the things I am hearing if stocks were at lower levels.
So using Alcoa as a microcosm, if you didn't own Alcoa, you would be buying here now that the big, bad quarter is over and you could leg in lower. That's pretty much the metaphor for this market, as opposed to "sell everything."
I don't like the tape . . . now. But maybe later and lower.
So why short everything? At those meetings I described, all I did was spout conventional wisdom. And conventional wisdom barely made you money. More likely it just lost you money. It wasn't a strategy, just a statement of disgust.
At the time of publication, Cramer was long Alcoa.
Follow Cramer's trades for his Charitable Trust.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
The stock rises 9% after the company reveals strong second-quarter results.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.