On today’s Wall Street Confidential video on TheStreet.com, Jim Cramer discusses the market sell-off hitting that bottom again and we may hit it again. He said this may be similar to the May-June bottom that we saw last year, although this one happened much faster and carried much more fear than back then. He says we are oversold and will bounce, but we’ll sell off again after Japan and Europe bounce. The linkages are false. Cramer says the Japan carry-trade is to blame but he still thinks this is a smokescreen. Cramer said this is the first day we are a market of stocks rather than a stock market and that is encouraging. He did note that the defensive stocks are bottoming first (15 of my 20 first-line defensive stocks are now up on the day).
The sub-prime companies are worthless according to Cramer, but he said New Century (NEW) will probably go out of business to Cramer and NFI is at risk too. LEND may survive but the book of business may be overstated and it could go down to $10 or $11 before bottoming. He also briefly noted that this elimination of the bad sub-prime lenders will give Countrywide (CFC) a clear path to owning the industry.
Jon C. Ogg
March 5, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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