Buy Banks on the 'Foreclosure Ruling' Dip
Bank stocks should not be down on Friday, Cramer said during “Stop Trading,” as the result of a ruling on foreclosures by a Massachusetts court.
The Supreme Judicial Court of Massachusetts voided the seizure of two homes by Wells Fargo and US Bancorp because the banks failed to show they held the mortgages at the time they had foreclosed. Fear that other state courts would follow suit weighed on these two bank stocks, as well as Bank of America , JPMorgan Chase and others.
But Cramer disagreed with the selling, not the least because he doubted a ruling from one of the most liberal courts in the U.S. would be repeated elsewhere in the country.
“It’s going to be forgotten after Monday morning,” Cramer said, “when one of the lemming analysts downgrades them.”
The “Mad Money” host reiterated his call on Bank of America, which he said Thursday was one of the best ways to play a rebound in the American economy. (Click here for Cramer’s 10 reason to own Bank of America.) He also said that Friday’s dip was a great chance to buy the banks before what he thinks will be their eventual push higher in 2011.
CNBC’s Herb Greenberg reported that the Justice Department’s anti-trust division is looking into complaints that UPS and FedEx are blocking customers from using third-party shipping consultants and negotiators to save money. Cramer said that after the run these stocks have had, it’s no surprise that investors would use the occasion to take profits and then return to them later.
Finally, Cramer urged viewers to read Mosaic’s most recent conference call, calling this a “remarkable moment in this [fertilizer] industry.”
“The best fundamentals in the world right now,” Cramer said, “are with the farm-related companies.”
—Reuters contributed to this report.
When this story published, Cramer’s charitable trust owned Bank of America and JPMorgan Chase.
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