Jim Cramer: Top 5 Reasons Not to Sell It All
Just trying to be more constructive here.
- We are very, very oversold and people are getting very negative. We all accept that we are going down and many are taking action.
- Many stocks will be impacted when we go over the fiscal cliff. Notice I said "when" because unless politicians rise above, we are going over it. But other stocks, international stocks with bases here that sell soft goods that make them buyers of commodities, will do well and they need to be bought into the weakness.
- Everything in the end gets discounted, meaning that we can adjust to anything and when we get there any new negatives won't mean much. But a new positive or a deal will send us soaring.
- The new taxes and spending cuts, while draconian, will not be the end of the world for the big secular growth stories out there, including health and wellness, as well the desire for a bargain.
- Plenty of companies have the power to raise dividends to where even the after-tax the returns are far superior to bonds.
Am I being a Pollyanna about this with these five positives? History says that to be solely destructive is to miss an important move in the market, although we don't know where it might begin.
We also know that EVERY SINGLE TIME in every single downturn, no matter how big or small, we've had stocks that bottom before others, usually in thirds, depending upon the circumstances. Sometimes industrials bottom first because the shock that brought them down is one-time only. Sometimes it is the soft goods that hit bottom and begin to bounce because the proximate cause of the decline is a downturn in the economy. Other times it is the higher-yielding stocks that bottom because they are fixed-income alternatives.
These are givens.