Cramer's Stop Trading! Sears Not So Bad (12/4/08)

Stocks discussed in Jim Cramer's Stop Trading! TV program, Thursday December 4.

Home Depot (HD), Lowes (LOW), Sears (SHLD), PHLX Housing Sector Index (HGX), Toll Brothers (TOL)

If housing bottoms on June 30, as Cramer predicts, there are three stocks which might rise on the news: Home Depot, Lowes and Sears. Cramer noted HGX, which includes Toll Brothers seems to be finding a bottom now and the market will follow six months from now. “That’s exactly how the market works,” Cramer said. He dismissed bearish comments that Sears may go out of business and said “Things aren’t so bad there.”

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Comments

[dsrtwriter:]

What incompetent advice. Talk about a contrary indicator.I watched the interview with Bob Toll, who is a decent guy.Cramer's take that a housing recovery may actually lead us out of this recession is backwards.

Sure, I agree with him that with lower interest rates, and more realistic cuts in house pricing,theoretically that would bring buyers in. But those buyers have to have steady jobs, and that is where there is such erosion.

Our economists' dogma on free trade and the idea that we are now too
"sophisticated" an economy to need manufacturing, that we have migrated to a higher plane of "service" jobs, that high school and college graduates thrown out of work in America simply have to "retrain", has resulted in much of the problem.

For all the touted theoretical advantages of free trade, it has not worked for America, in an era where we have no higher level jobs to migrate to.
Low wage countries can build everything from computers to aircraft; they are not confined to low tech textile jobs anymore. Hello, Harvard economists, are you listening?

So housing will rebound when we have workers with steady jobs who can finance sensible downpayment mortgages, not no-doc or no interest mortgages.

And that is not going to happen until we decide to reorient our priorities for the economy.As long as manufacturing can be done offshore at low wages and benefits and export tax free to this country, we will continue as a Wal Mart economy- until the money runs out.

2008 Dec 05 01:18 PM

[MrsLinarcos:]

Cramer, you have no idea what you're talking about. I worked for Sears and I know what's going on. Do you?? Have you shopped Sears?? Have you seen how employees are being treated? How constantly being out of stock of items needed on the floor for a sale or not in stock? How about waiting in line too long to get checked out?? Are you aware of cash wraps being closed, therefore making it harder for a customer to get out quicker when they're finished getting what they came in for? Are you aware at all that Eddie Lampert is NOT a retailer at all?? That all he is, is a hedge funder and not really putting money in a company that's been around for over a hundred years?? If I were you, I'd sell all the stock, Sears (SHLD) is going bankrupt and all your "buy Sears" is all for nothing. Customers and employees see what's going on, however, you've turned a blind eye.

2008 Dec 29 09:01 AM