Banqueiros centrais trazem neblina para Sintra

[Ulisses Pereira]

"With War Over, We'll Get Another 10% Bounce"

By James J. Cramer
04/07/2003 08:45 AM EDT


"Is the war over?

I know there's the hunt to find Saddam Hussein. And there's the battle of Tikrit. But the battle of Tikrit might turn out to be the Battle of New Orleans, the big victory after the war.


Let's presume the war is over. The only reason people aren't saying so is that there's always the chance of a doomsday defense somewhere.

If that's the case, what are we entitled to, a 5% bounce? A 10% bounce?

The one map that has gotten me the furthest is the 1991 map, which says that, at a minimum, we get another 10%.

Let's take stock for a moment. The Iraqi "problem" has frozen a lot of business -- we don't know how much of course, and the bears will say there were tons of other reasons and problems. That will now unfreeze. I am a bottoms-up guy. But I own stocks like Masco and Target and May and Schwab that were much higher not that long ago. I think they should be able to rally to where they were before the "freeze."

Before you email me, each of these stocks has individual problems. But you are outthinking the market if you let that get in the way of euphoric buying. You don't have to tell me about the problems; I know about them. You don't have to tell me that the problems "won't go away" with the end of the war; I know that. What you should ask yourself, before you email me, is "If this guy knows the problems, why is he saying those stocks will go higher?" The answer to that is circular and unattractive to many of you: It's my professional judgment, after 22 years of doing this stuff, that such a move will happen.


Look, step outside the last few weeks. If you knew we could win this war with fewer casualties than the last one, and you could stop listening to the anti-American propaganda out there for 10 seconds, you would have to recognize that we may very well have put into motion something pretty amazing here: the possible beginning of the end of the brutal, horrid regimes that for so long have threatened the peace in one region in particular and our world in general.

That will be viewed as positive by the market. It will cause bonds to go down, optimism to pick up and, perhaps, a recovery to occur. The idea that you can tangibly identify what causes a recovery is just baloney. It is all psychological, provided you have an accommodative government. And anyone who thinks these folks aren't accommodating is crazy.


That, in a nutshell, is the reason I think some stocks that have been forced down by psychology, notably retail and banking-related shares, will enjoy a nice bounce up here.

When I was at the hedge fund I would pen columns like this and end them with: If you disagree, please feel free to short the move.

Hmm, you know what? That's a good way to end this column, too! "

(in www.realmoney.com)