Cramer’s Game Plans most often use earnings, analyst meetings and industry conferences as key catalyst, but President Obama’s crackdown on the banks has changed all that. Now investors have to take into account a new factor – politics – when deciding whether to buy or sell a stock. Case in point: Friday’s 217-point loss in the Dow and the S&P 500’s 2% decline following the president’s continued talk of increased regulation.
And it’s more than just Obama. There’s speculation that Treasury Secretary Timothy Geithner could be replaced, and Federal Reserve Chairman Ben Bernanke’s reconfirmation is by no means a sure thing. The loss of either man could cause the first serious correction since the bottom in March, Cramer said – “a thousand points, minimum.”
“We lose one, let alone both,” Cramer said, “and the horrible action we've seen so far this week will look like a picnic.”
For that reason, Cramer cautioned investors not to buy any stocks until the question of Bernanke’s second term is resolved.
What about earnings? In addition to the volatile political climate, Cramer said, there will be so many reports on Tuesday, Wednesday and Thursday that trading could be dangerous. He urged viewers to forego any buying and selling until they had passed. But here’s a list of the company’s announcing numbers and what to look for:
Apple reports on Monday and unveils the much-anticipated tablet on Wednesday. The pattern with AAPL has been to sell into a product introduction and buy it back after. He thinks the pattern will repeats itself.
On Tuesday, Cramer is looking at Corning and EMC to give us an idea of demand for technology worldwide. Nucor and US Steel will tell us whether there's any infrastructure spending on the horizon and if China's dumping steel. And one of Cramer’s favorites, Johnson & Johnson, reports, too.
Wednesday is heavy-industry day. Cramer will be watching Boeing to see if the company is ready to ship the Dreamliner en masse. Cramer is also keeping an eye on Caterpillar to see if there has been any pickup in U.S. machinery sales or any slowdown in Asia.
For Thursday, 3M also will teach us about Asian demand, since it gets so much of its business from that part of the world. AT&T will be reporting, providing an update on its price war with Verizon Communications . And Colgate-Palmolive and Procter & Gamble will tell us who is doing better selling toothpaste and deodorant (Cramer thinks it’s PG).
Finally, after the close Thursday, Amazon.com will report. Cramer said to remember that this is a market has been unkind to winners, and AMZN is up 150% going into next week. Anyone who owns the stock should prepare for some turbulence. If you don’t, buy Friday afternoon after the sellers will have cleared out. You might get Amazon as a nice discount.
The bottom line: Remember, new game plan, new rules, Cramer said. The Bear in Chief Obama now resides in the White House, and he seems to favor lower stock prices.
“So let’s wait for hibernation, Bernanke's confirmation and the fog of earnings to clear,” Cramer said, “before we pull any machine-gun buy [triggers,] let alone a single shot.”
Cramer's charitable trust owns Apple and Procter & Gamble.
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