Mega plano orçamental foi promulgado por Trump

[Ulisses Pereira]

"The Bond Market Is Boss"
By JIM CRAMER
OCT 05, 2011
2:48 PM EDT


"I found myself fascinated today listening to David Faber interview some of the greatest minds in credit at the Barefoot Economic Summit. Fascinated because so much of what he and his guests are bantering about is so much more important than stocks, than the entire stock market, not just here but in Europe as well. That's because credit's the most important issue out there. It was the most important in 2008. It is the most important now. And most people who only invest in equities have no idea of its importance and how it impacts the world.

I sure didn't' know when I started working at Goldman Sachs (GS) almost 30 years ago. I came in with guns blazing about stocks and I quickly realized I was facing a tank called bonds with a peashooter.

In fact, in the first marathon Friday night session (mandatory classes that went well toward midnight after a long, hard day of learning at the desks of others) it was drilled into my head that the bond market's ten times bigger than the stock market. And that was back in the 1980s. It's probably 100 times bigger now given all the sovereign debt worldwide and all of the debt the U.S Treasury alone has issued since those classes convened.

But it is not just size. Unless your business is a total cash business, you need credit. Unless your country spends dramatically less than what you take in from taxes, you need credit. You cut off credit, a nation can fail. You have heard of banks that are too big to fail. We've got countries that are way too big to fail and are on the verge of failing. They are too big to fail because they will cause almost every debt holder of size to fail.

That's not the real point here, though. The point is that most people who follow the stock market don't realize that the bond market's the boss here. The debt holders hold the key, whether it is Eastman Kodak (EK), where the company thinks it is in charge (believe me, it isn't) or whether it is SocGen, Paribas or any of the French banks, or with Greece itself. The debt holders are so powerful that they can hold up governments that might want to do the right thing. The debt holders in real estate, the banks, won't allow borrowers to refinance at the low rates that Fed chief Ben Bernanke has given us. The debt holders in Europe won't take the losses that the government would like them to take.

You know how powerful they are? Remember that scene in The Godfather: Part II, when Cramer fave Hyman Roth says to Michael, "We're bigger than U.S. Steel," a tacit acknowledgement of the behind-the-scenes power of the Mob? Well, the Mob has nothing on the bondholders. Once you realize that, you can start understanding why we keep going down on credit news even as the corporate earnings news is terrific.

So, when you are confused about the power of credit, just remember that Roth-Corleone power play. Then you will be able to put equities in the pecking order to which they belong. "

(in www.realmoney.com)