O petróleo está em queda, mas a incerteza continua em alta

[Ulisses Pereira]

"The Cut Has Changed the Market"

By Jim Cramer
RealMoney.com Columnist
9/19/2007 8:20 AM EDT

"But what about oil?
But what about the dollar?
Is it enough?
Is it too much because of inflation?
Are they behind the curve?
Is it wrong that hedge funds get bailed out?

I have no objections to any boilerplate questions about the Fed and its rate cuts. They make sense. I do, however, occasionally want to suspend suspicion and cynicism and even, yes, skepticism, for the moment after something as monumental as yesterday's half-point cut.

I say that because sometimes my job conflicts with the need to be the skeptical reporter. That's because there's an overriding need on this site and in what I do for a living, which is try to make people money. People want to know how the market will react, they want to know if it is time to buy, or too late to buy, or okay to buy, or good to sell. Those questions are obfuscators. They are theoretical. They get in the way of making money, and if answered incorrectly, they block the chance for making money.

Of course all of those issues are concerns, chiefly oil. It's not "good" that oil is going higher, even though to anyone with a car, it is obvious that it hasn't filtered through. I paid $2.60 yesterday, a dollar lower than I would think I would have had to pay given crude. Weak dollar, possible inflation flare-up, all bad.

But the simple answer is that things were not right going into the meeting. Big things. You shouldn't have T-bills so high when the 10-year is so low. That's 105 degrees on the thermometer. Those who fought 50, thinking it is too much, that it means panic, are the same people who would deny children antibiotics lest they scare the parents! It's all nonsense. Retail, autos and banks are real economy sectors, and everyone knew they were hurting.

I swear, I think there were a lot of underinvested people squawking Tuesday, pointing out all of these risks. Anyone who is truly "worried" about business can't be "worried" about a half-point. Anything that gets us to where the short-rates are lower than the long rates is a win for business and business people know it.

Why would their stocks not gravitate higher when that's the case?

When you have the CEOs of outfits like Ford (F - commentary - Cramer's Take - Rating) and GM (GM - commentary - Cramer's Take - Rating) calling for rate cuts, that means something. They can afford to offer lower-cost financing to move inventory. Strapped homebuilders could get some relief as banks are now going to lose a half-point less when they are renegotiating.

People will feel better and spend more at retail, helping a Kohl's (KSS - commentary - Cramer's Take - Rating), a Target (TGT - commentary - Cramer's Take - Rating) or even the hated Sears (SHLD - commentary - Cramer's Take - Rating). How can that not be better?

As far as whether rates can "save" homebuilders and stimulate buying, all I can say is: How can it hurt? The summer and fall are already miserable. The firesale will prove to be a blip for Hovnanian (HOV - commentary - Cramer's Take - Rating), but at least a blip that shows you that Hovnanian may be solvent. So don't buy the homebuilders, but you can't short them any more.

Or how about the banks? Do you feel worse about buying Washington Mutual (WM - commentary - Cramer's Take - Rating)? Wachovia (WB - commentary - Cramer's Take - Rating)? Doesn't it make you feel better about the margins a Thornburg (TMA - commentary - Cramer's Take - Rating) could have or that a Downey (DSL - commentary - Cramer's Take - Rating) or a First Federal (FED - commentary - Cramer's Take - Rating) could have? I would buy them both.

In the meantime, the effects of cash rates being lower of course lowers the competition to an AT&T (T - commentary - Cramer's Take - Rating) or a Verizon (VZ - commentary - Cramer's Take - Rating) or a Con Edison (ED - commentary - Cramer's Take - Rating) or a Genesis Lease (GLS - commentary - Cramer's Take), like I had on last night with its 8% yield. What a great story that is!

So, let's put away all of the theory and shelve the morals. Today's a better day than before the half point. As someone who even the New York Times acknowledges was the most vocal critic of the Fed because they didn't know how bad things were out there, I relent and praise.

They know something is very much awry. They had to suspend the worries that I mentioned up top because they had to save jobs. Because they had to save the economy, and anyone who thinks they didn't is simply a simpleton. Sure, if they wanted to, they could "break the back" of inflation. But things had gotten out of hand very quickly and there's no reason to cause a recession in order to try to knock down the price of oil and corn. If houses were in the CPI, you would see that their goal might very well have been to stop deflation, not stop inflation.

In sum, don't be distracted. It's not too late to buy. And if you are short or underinvested you've got to get your butt on a site, in a newspaper or on television expressing those qualms I ignore at the top of the page.

How else are you going to bring in the shorts and put money to work on a sale?

At the time of publication, Cramer was long Sears Holdings. "

(in www.realmoney.com)