Cramer: Now’s the time to do some buying (video)

He saw the “whoosh” and thinks the market is now oversold.

From a CNBC special Thursday after the close, starting at the 4:00 minute mark:

Bob Pisani: So when people ask “what do I do?” is your playbook tomorrow to wait another day?

Cramer: No, you actually have to do some buying.

Pisani: Really?

What happened? What should you do? from CNBC.

My take: Cramer didn’t mention Apple, but he came close…

Cramer: I don’t know when you buy Amazon other than it’s when down big and people are really scared.

Below: How Wednesday and Thursday’s pain was spread among the tech mega-caps:

cramer market oversold

7 Comments

  1. Gregg Thurman said:

    Yesterday, before he said it, I took Cramer’s advice.

    Bought 440 Nov 9 Call Spreads and initiated my “free” shares strategy.

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    October 12, 2018
  2. Jonathan Mackenzie said:

    The whole market is ridiculously over valued. I like AAPL because it has the best chance of supporting it’s current price, but in a market wide reset it could still easily decline to 180.

    We may very well see buyers rush in and bid prices back up to where they were, but that does nothing to prevent the inevitable. Once the real impact of rising interest rates is felt across this market that has fueled growth with debt, it will be impossible to support the current multiples. Tulips have gone on sale. I’ll pass.

    A whole generation of investors have learned the wrong lessons about what constitutes value. Buying the dip works until it doesn’t. Markets are still grossly distorted.

    We may get a stay of execution, but one day the axe will fall.

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    October 12, 2018
    • Gregg Thurman said:

      Once the real impact of rising interest rates is felt across this market that has fueled growth with debt,

      ALL growth is fueled by an increase in cash liquidity. The goal is to keep the growth of liquidity from becoming fuel for destructive inflation.

      I don’t see the Fed rate increase as a negative, but rather as inevitable as there is now early signs of inflation greater than the Fed’s target of 2%.

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      October 12, 2018
      • Jonathan Mackenzie said:

        I don’t view it as negative either, in fact I think it was kept far too low for too long. The return to normalcy is critical. But the market has been priced into La La Land by free money. When the cost of capital reverts to the mean, earnings multiples will as well. Most stocks are in for a pretty severe haircut. And since markets tend to overshoot, it could get ugly.

        But I’m all for rising interest rates. The sooner we get to 5% the better in my book. But there are many people who are now investing who have never seen 5% and whose impression of stocks was formed in an artificially liquid world. These folks are going to get an education over the next few years. Some will learn, others will panic.

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        October 12, 2018
        • Jonathan Mackenzie said:

          I think my reply may be poorly worded. It sounds like I think I know what the market will do. I don’t. But I do know that markets go down as well as up. Over long periods of time, up is usually the better bet. But I am reading so many people talking about stocks like NFLX, TSLA, AMZN, and even AAPL as if they can’t go down, or if they do it must be a buying opportunity because they can only go up from here.

          I think this very long bull market has taught many people that it’s easy to make money on stocks. All you have to do is buy. That strategy has worked for the last decade. I am not certain it will work for the next one.

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          October 12, 2018
          • Gregg Thurman said:

            I agree with you to the extent that firms without a tangible product, operating on slim margins will be driven into extinction since the ‘70s. It’s the wearing , made possible by the low cost of capital that overheat the economy, and by extension, the markets.

            The current expansion lasted as long as it did because so much capital was ripped from the world’s economies during the banking meltdown of 2008. A byproduct of that reduction in liquidity was near zero inflation. But now those monies have been largely restored and inflation, destructive inflation, is a real threat.

            How will Apple fare in this “new” economy? The survivors are always those with strong balance sheets and low debt.

            Just as you are concerned by low interest rates, I am concerned by super low unemployment rates.

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            October 12, 2018
  3. Fred Stein said:

    Ten year treasuries are 3.14%. Apple earns 6% and growing. It’s an undervalued as both growth stock and as yield* stock.

    *If one counts the 5% (or more) annual buybacks as dividend re-investment, the yield is 6.4%.

    1
    October 12, 2018

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