When your job is to write a commentary about the stock market you start with a blank Word document. It stares at you and says, “Come up with something noticeable that makes sense of the market.” Right at that moment, the inception, you can go either way. You can detect a pattern that points to an absurdity, let’s say a warning about a two-track bias, one with light volatility and the other with craziness. Or perhaps a simple jeremiad flagging a dangerous oddity of mega-caps versus non-mega-caps that bemoans, or worse, causes worry that might tempt people to “get out now.” “Get out now.” That’s an ill-advised warning I penned in my “Wrong” column for TheStreet.com, the business website I co-founded, warning readers of impending doom after we had had that doom. That past was at noon ET on October 8, 1998, oh so many years ago. Everything you write online can and will be saved and used against you. I wrote that commentary in a moment of weakness that day, within minutes of the bottom of a painful bear market, a forever-flagged searing panic tattooed to my temporal lobe. It’s an instructive, visceral moment, born on the trading desk of Cramer & Co., because Karen Cramer, my now-former wife, the best pure trader on Earth at the time, sitting at my seat at the top of our U-configured desks, catalogs in hand, watching and waiting, dispatched me for a hot pretzel and a Diet Coke. Once I had gone on her mission, instead of getting out of the market, she borrowed a billion dollars, far more than we had a right to, and put it to work. Her firehouse of money struck the market at its absolute bottom minutes before the Federal Reserve issued one of those “any liquidity necessary” bulletins that obliterated the bear for good, followed immediately by the interstitial fire of short covering born of panic making sure that darned thing was slain. The whole thing occurred while I was at the corner of Water and John Streets in the financial district of New York City, slathering mustard and wiping my hands of a bright yellow spill. I had been weakened by months of ursine saturation bombing. It was an ugly moment. Her strategic pivot made our year. It was a humbling bet against what amounted to us, causing me to hastily change the “get out now” to something akin to what she was doing. But it was too late, the damage had been done. I bring up this mortifying moment because it reminds me of what happens if you write to extreme. If you put pen to Word, as it were, and issue an equivalent of “get out now.” That’s when you write to fright, forever warning all about the hazards of a moment when the mega-caps could bring down the market, or of the dominance of a few stocks versus the sluggish path of the smaller, $100 billion cap brethren. Yes, there’s a corrosive jealousy that lingers heavily when I read these pieces, of which there was one in the paper this weekend, no need to flag the siren by name, but it was there alright. So many journalists take advantage of the right to fill that blank page with warnings that amount to “get out now,” without the consequence or a post-mortem. How I wish there was an editorial coroner that forever labels a piece as “Wrong,” as surely as my unhedged warning posted at the bottom of the bear market of October 1998. Why analogize now? Maybe after a historic run from the bottom to the top, I have read so many of these pieces which ended up as nothing more than defective bricks in the wall of worry. It’s a journalistic wall that’s noted and often acted upon. Acted on because of its rationality, as in “holy cow I had no idea how narrow the market is,” or “I can’t believe that Nvidia ‘s behind so much of the run.” These amount to abandoning the wall rather than scaling it, and have kept you out of so many points, hidden in the 5% sidelines that feel so cozy. I hate these pieces. What should be written then? How about a hedge to the thesis, something about how things could go right, perhaps during the time it took to walk from the office to John and Water Street all those years ago? Something like “the narrowness could be a reminder of so many past bull markets, where other stocks joined the resting leaders and broadened the market.” Or even better how about “10 stocks that could go up next” not with a quote from some money manager or two but from the journalists, themselves? So many of the “get out now” pieces are the musings of the journalists, while the rare bullish pieces are couched with Panglossian money managers justifying the run. I hate those unaided proclamations. You see, this market rally has been based on the narrowness of itself. But that means nothing. It could simply be a precursor of something bullish next. It could preface a changing of the guard. It might be a screed full of sound and fury signifying nothing. There’s nothing wrong with being bullish. There’s nothing wrong in warning all of those sidelined bears that the best could be yet to come, or a wider phalanx could beckon. Why necessarily fill that blank Word document with solemn warnings about how foolish the bulls can be? I think the answer is two-fold, both damning. First is that there’s no consequence to a journalist penning something that amounts to “get out now,” something that dogged me for years after it was time-stamped in thestreet.com. Second is, sadly, the need to write a piece as an assignment, something that’s demanded as part of your job. How much better is it to write about “A Hard Rain’s A-Gonna Fall,” thank you Bob Dylan, than to declare the time halcyon? How much easier it is to damn than to praise, knowing that if you are wrong there will be no consequence. Of course, this bias does not exist just in the media. Bearish analysts and commentators can surface, usually though, as a consequence of a sharp decline. But these people tend to be foils and no more, just a series of Mike Wilson barbed wire on top of the worry wall. Thank you, Morgan Stanley. But in the end, what matters is fear. I read this weekend’s staple of narrowness as a sign of impending doom, and thought to myself, wow, that’s scary. You did, too. But maybe you just weren’t aware of the hazards of “get out now,” because it’s part of the numbing sensation that comes with reading one more obvious warning about how “stupid you are to stay long, you idiot.” Too harsh? Maybe something I had to write because it was my turn to write on a cloudy Sunday morning before an afternoon of pulling weeds in my garden. Yes, I am supposed to write something. No, nobody’s saying, “How wrong Cramer can be, just watch the collapse that occurs now.” So go timestamp my piece. Remember it as being the last piece – the fin de siècle, if you will – before the great collapse of a midweek in June. I don’t mind. I already wrote, “get out now.” Nothing worse than being the last bear skunk in a bull market party unless it doesn’t matter because you had to fill a page of non-consequential bearishness. You did your weekend assignment that had to be done to check the box and head to the Hamptons or the mountains or just to sleep late. And, yes to sleep well, because your prediction had no wake if the market tacked higher, and branded you a genius, perhaps forever, if last week was the top. (Jim Cramer’s Charitable Trust is long NVDA. See here for a full list of the stocks.) 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When your job is to write a commentary about the stock market you start with a blank Word document. It stares at you and says, “Come up with something noticeable that makes sense of the market.”
Right at that moment, the inception, you can go either way.
