Recap of Jim Cramer’s comments on Wall Street Confidential, Wednesday November 28. Click on a stock ticker for more analysis:
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Cramer noted parallels between the current slump and the difficult market in the 1990s; in both cases, an Arab stake in Citigroup brightened prospects in the financial sector, in the 90s, there were "shotgun marriages" between big banks, and recently, a prospective merger between BAC and C was announced. In 1990, the Dow dropped 11% and the Dow's fall is currently at 10.5%. Although 1990 saw a $200 billion problem compared to today's figure of $500 billion, Cramer noted the economy has grown substantially since 1990, and the figure of $500 billion does not mean so much.
Cramer thinks financials are bottoming, and sees WFC's rise despite terrible news as a sign. In the process of bottoming, banks and builders will fail. "What I think you have to do is cover all your shorts financial and start picking the ones you're comfortable with," he said. Although there is no way of predicting how long the bottom will last, the seven month decline in 1990s may be a gauge. Cramer concluded "What I think matters is that we're seeing the same signs."
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