Why are people chastising this market?

They're not revealing their positions, and it's my belief that those who denigrate this rally are either betting against it or sitting it out.

By Jim Cramer Mar 6, 2013 10:07AM

thestreet logo"Are you short?"


"Did you miss the rally?"

 

"Do you have a ton of cash?"

 

"Do you need the market to go down to outperform?"

 

These are the questions I want answered right now when I hear people denigrate this market. These are the questions that cut to the psyche of an investment professional -- because, right now, many of those individuals you see being interviewed, or whom you might be reading, have missed this market. They are, therefore, of a different mindset than they might otherwise be.


In other words, they need the averages lower, not higher, in order to catch up. Even if they don't like the market, they do have to catch up if they are going to be rewarded as handsomely as they hope to be, with new money, with bigger bonuses, or whatever perks for which they might be striving.

 

I believe that not only that this rally is hated, but that the people who hate it are either betting against it or sitting it out. So many people came on air Tuesday and backhandedly chastised this market that I've had to figure they are of the cohort that didn't make the money when the money-making was there to be had. What's backhanded? Here's some I heard:

 

Arrow Up Photodisc SuperStock"The market is too extended right now, so I think it is the wrong time to commit capital."

 

"I would like this market on a 5% pullback."

 

"I am looking to buy more stocks as the market goes down."

 

The simple truth is that anyone who follows these dicta has not been able to keep pace -- because the market has been traditionally overextended for ages, and we haven't seen that kind of a pullback. Not only that, but as the market goes higher, a 5% pullback would only bring it back to a level where these people hadn't liked it anyway.


Let's take the consensus case manager. That's someone who says, "I will wait to see what happens with the sequester, and then I will buy, but I will buy small, because I think the Federal Reserve might discontinue its bond-buying and then the rally could fizzle."

 

My thinking is that this is the same kind of money manager who didn't take advantage of the decline before the fiscal-cliff resolution and had to pay up afterwards. We know, of course, that this was a costly strategy, but as of Tuesday it had still been better than doing nothing.

 

This kind of money manager is clearly not all in, or has very little conviction, due to fears about the fickle nature of Washington. They fear the Fed minutes. They fear the Thursday employment numbers. They fear the Labor Department nonfarm payrolls. They fear the words of every Fed governor who talks about the bond-buying. They fear all testimony by Fed chief Ben Bernanke. They fear all press conferences by House Speaker John Boehner and President Barack Obama. For all I know, they fear "Meet the Press" on Sunday.

You simply cannot invest in a climate of self-imposed fear in the kind of bull market we have now. If you find yourself thinking, "OK, we are fine right now, but just wait until the bloodshed," then you aren't going to take positions with any confidence, and you'll be spooked by every mention of anything involving the Fed. That means you are going to be so defensive, that you'll have much less exposure to stocks and more in cash, which is a license to fall behind in rapid fashion. You will most likely not have participated in the consumer packaged-goods upswing, and you certainly aren't going to be involved in the industrials or the home plays, because both would be hurt by the Fed's actions.

 

You would most likely be short those sectors if you were a hedge-fund manager.

 

Consequently, that advice, at least from this kind of person, is tainted or questionable. That's why I want to know your positioning. I know that's a bold interrogatory. But I am unique here. I have to play with an open hand. I feel the sword of this market on my neck every minute, courtesy the public portfolio that is Action Alerts PLUS, and all I can say is that at least you know for certain where I am coming from.

 

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.   

 

 

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64Comments
Mar 6, 2013 11:22AM
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If you keep on priming the pump, you're gonna flood the engine sooner or later.
Mar 6, 2013 11:12AM
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Hey I got an idea........... The banks are flush with money to loan... right? It is not moving into the private sector very fast ....... How about if Obama changes the SBA loan rules so that white men can get a small business loan also.... Win Win..... ends the reverse discrimination on white men and pumps up the number of people for possible business loans....... Maybe it would even improve employment.
Mar 6, 2013 11:15AM
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With 15 years before possible retirement, I made no change to my main retirement accounts, but other than that all new money is going into value stocks, bonds and mostly cash. The economy is not fixed and you would be an idiot to buy large into this market.
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The stock market is a bubble right now about ready to explode.

 

In 2007 the stock market was over valued at the levels the stock market is hitting now.

 

The economy is about 40 percent weaker now than then.

 

What makes anyone think the stock market should be at the levels itis right now???

 

MARKET CRASH AND BURN later this year.

Mar 6, 2013 11:36AM
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Maybe it´s because this rally is based exclusively on the Fed money printing and, unless they keep it when inflation hits hard, it will unwind badly.
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I remember when the DOW hit like 13,000 a lot of people were saying in a couple of years the DOW should hit 33,000 pretty much they are moving money market accounts into the stock market to steal the money again and will trash the stock market later this year.

 

Pump and dump that is the game the Wall Street bankers play.

 

Pump and dump.

Mar 6, 2013 12:12PM
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AA dow stock of the year at 18 now 9

gold at 1900 now 1600

FB at 36 now 28

AAPL at 700 now 430

GM at 34 now stuck in the 20's

 

meanwhile the dow index which he hates is at new highs

BEWARE OF THIS HACK 

Mar 6, 2013 12:31PM
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Its time for the feds to stop the QE program , and soon ! The only thing keeping this market alive is pumping 85 billion a month into it ! Its full of hot air , nothing more. When the Feds and Ben stops pumping the cash , the market will deflate . Can you say 6000 DOW... LOL
Mar 6, 2013 12:41PM
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Cramer - "record high, time to buy folks dert dert"
Mar 6, 2013 11:58AM
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THE CYCLE OF INEVITABILITY

Birth: A civilization is born out of a void. People work hard and gain from their efforts.

Growth: More people come and work hard. Prosperity comes because everyone works hard and makes gains.

Maturity: Pariah come; make laws so there are lawyers, taxes so there are bookkeepers, money so there are bankers and financiers, bureaucracy so there are politicians, paper so there are administrators.

Decline: People get tired of working so lawyers, bookkeepers, bankers, financiers, politicians and administrators can usurp all power and use corruption to suppress the masses into servitude. Civilization crumbles.

Death: The people rise up and destroy all pariahs.

Re-Birth: A new civilization is born out of the void. A “No Pariah” sign is posted. People work hard and enjoy life.

Mar 6, 2013 12:40PM
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85 billion in cuts is not a 'self-fed' fear - it was given directly by my Obama.  Wait till the jobs report shows the big lay offs etc.  This will hurt and there will be more than a 5% pullback with time.
Mar 6, 2013 11:18AM
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certainly with a buy low, sell high rule book; if this IS a peak, it's not a time to buy.  it's time to 'hope" for a serious correction in order to get onto the ride! 

 

but what is the volume of sales?  if the common man has only a 401K mutual fund to work with, does "he" and all the masses equate to 50% of the market?  20%?  what is that particular buying volume? 

 

or are these peaks coming from the 1%'ers?  or institutional buying from other institutions? 

Mar 6, 2013 11:52AM
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Hey Mr. Harvard grad... swallow this (but don't choke)... the effects of hyper-printing fiat money and the two outrageous currencies-- debt contracts and derivatives were PURELY evident in late 2006 when in sync- housing values began jumping in appreciation without substantiation. Much like it did just after April, 2001's market crash, the economy began self-correcting. TARP changed the outcome and sent the native economy crashing. It has never recovered. All that has occurred since is manipulation from huge commercial tranfusions of false capital in a triangular pattern-- Fed to banks to business platform entities. Housing hasn't recovered, it's been kited (fake sales in key neighborhoods to raise values) as mortgages fell in margin to substandard levels for servicing (everyday is a loss because the current rates fall incredibly short of overhead). Banks lend it (poorly), sell the debt contract back to the Fed and get more to do the same. All costs involved are accommodated by more printing. It's a loop created by and manipulated by stupes! IF you invested in gold bonds or stocks in 2007-08, your original dollars have been diluted as much as 10,000%. It IS that high because the original $50 to $60 Trillion in global currencies now exceeds $1 quadrillion or more and that doesn't include those debt contracts or derivatives (which were in the Trillions in 07-08, imagine what they are now). IF you shelved it and bit your lip while greed flashed gains before your eyes and you went blind-eye to them-- you have exactly what you started with and it isn't diluted 10,000% unless you liquidate it now (the worst possible time to). People are chastising the market because they can visualize the swollen mass of piss and puss filled bubble looming over their heads and certainly are not looking forward to a Trickle Down. In fact-- a Truss Up and super gluing to the Fed, banks, billionaires and every financial pariah on Earth is the best idea. You've lived the life of a pariah, Jim.
Mar 6, 2013 11:36AM
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The market is close to where it should be; in "Inflation Adjusted Dollars." It's still way down from previous highs factoring in buying power. 
Mar 6, 2013 2:10PM
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What's driving the DOW? Cheap easy money. Had Obo never been inflicted upon us, we would have passed this mark a year or two ago, and it would have been because we had a real strong economy, not the fake economy we have now.
Mar 6, 2013 2:57PM
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Cramer looks out the window to forecast the weather again.  Market went up?  Cramer predicts market will keep going up until it doesn't.  Market went down? Cramer predicts market will continue downward.

 

Keep up the great work, Jim!  The Nobel committee will be calling any day now.

Mar 6, 2013 11:26AM
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We are still driving up this morning, its early though, we don't have that warm fuzzy feeling....Be careful this afternoon, profit taking is a big possibility plus manipulators will no doubt put their two cents in...As much as we love this market to keep going higher, be cautious.
Mar 6, 2013 1:57PM
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Cramer:

You bet we missed this rally because we lost not only

the money that was in the market but also the equity

in our homes.

The vast majority of americans are fighting

for there lives.

They are broke there pensions are gone or in jeopardy.

You guys will have to find some other sucker to buy

so you can sell.

This real economy is in shambles, it will take

years more than you and I have to

return to prosperity.

 

Mar 6, 2013 1:36PM
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I wish I could retire now before this thing deflates.

Mar 6, 2013 3:15PM
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I remember clearly one morning in early 2000, Kramer was interviewed on CNBC and was asked for mutual fund recommendation. "Buy anything from Janus. They have the highest percentage of technology in their funds."  Yep, that was when the NASDAQ was at 5,000. This guy is a market chaser and will run you right into a brick wall.
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