The Federal Reserve won’t act until things are dire, so that was just the doom and gloom the market needed. It’s never a question of if the Fed will intervene, it’s just a matter of when. So the bleak picture Stumpf painted might have been just enough to prod Chairman Ben Bernanke into action.
But in the meantime, clear out of Countrywide , Washington Mutual , Downey Financial , E*Trade , Standard Pacific , Pulte Homes , Centex , Beazer or any of the mortgage lenders. If Stumpf was spot on, these stocks won’t work for a very long time, Cramer said.
Instead, buy defensive stocks like Coca-Cola , Altria , Colgate-Palmolive and Clorox. Even Avon is great these days. And don't forget healthcare plays like Medco Health Solutions .
Hang tight, Homegamers. The worse the market gets, Cramer said, the brighter the future looks.
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