The world revolves around the sun.....nope, my mistake, it revolves around this world with earnings and ten year rates, along with technical bs.
So as I have explained before, when interest rates were as low as 1.5%, it didn;t really matter what your company did as long as it paid a better dividend than the the ten year rate. So most of those dow stocks, telecom stocks, and defensive stocks all had a nice rally based on fluff and the low ten year rate.
But now the ten year is double the rate of a year ago. Those companies with dividends.....facing reality that their earnings/revenue growth and now dividends are not up to par with the guaranteed rate of 2.94 from the government.
So what is the investor to do? The investor now shuns those dividend/defensive stocks because le'ts face it, their earnings are not going anywhere that nobody knows. If anything, they are facing declines.
So money is now on the prowl for those companies it shunned; the companies ACTUALLY growing, companies with PLANS/INITIATIVES to grow, and companies that produce a lot of cash flow that if one did their own homework would see comes out to a higher rate than the current ten year rate and this is just from no growth(Deckers).
There are plenty of companies with higher premeiums already as not all companies are treated the same. But those companies that have not fully recieved their premeiums, as long as the interest rate stabilizes around this level, those companies are going to get back some respect.
But you will get clowns like Cramer(a proven clown, says to buy netflix again 18 months after saying sell for double the price and the same price he liked it last) and Guy Adami("fast trader" my #$%$ he can probably barely pay his rent) focus on these "momentum" plays.
These two trolls pretend the market is not run by machines(85-90% of trading) and that what is momo today has any reason for being up than some technical BS.
For example, Apple at 385/share was down 26% for the last 52 weeks.
Apple today at 490 is down 26% for the last 52 weeks. Every closing for Apple has closed it in the range where at the close, its price "today" would be 26% lower than 52 weeks prior. Welcome to technicals and machines.
See, in between earnings, tehcnicals and the machines make up the price(unless you get some big guns like a carl Icahn to shake some trees). When an earnings comes out terrible, technicals go out the window and REAL market influences come out and play and RESET the price drastically.
Deckers is now up 130% from the low set 11 months ago. Have you head cramer talk about deckers cash flow? Have you heard him talk about UGG PURE? No, but I guarantee you once Deckers gets much higher, you will har that $$$$ make a call to buy, where there is much more risk.
Look at them talk about netflix these days. When it was at 60, anybody and their mother could have made a stab for one of the most used products in America. Everybody "hated" it(typical retail thinking alike).
On the under armour message board, under a different username, I made a call that netflix was a steal at 60 on my jan. 1,2012 post, under username indian8788. Part of my top pick then.
Nobody got how CHEAP it was at that level, like retail who hasn;t see this whole ride up how cheap we(deckers) is.
Then now when the stock is up 400%, now CRAMER "sees" how cheap it is. Don;t you see what a schmuck he is? This is the guy giving out advice to people? Jon stewart should toast his #$%$ again.
Besides a new 52 week high and momentum, Cramer has no reason to say buy netflix . He doesn;t state any cash. He doesn;t use valuation. This is a guy approaching the roulette table betting on black or white, whichever color fancies him at the moment.
Seriously, what the heck is going on here? How does this guy get a show(I don;t care how well he did for his fund which if you read in his book was a real roller coaster and he got asked to leave)?
Bottomline, his approach has nothing concrete to it. He has a show they put on when he takes a day off to "explain" how he oks for stocks. He states he starts with the new 52 week high list and states clearly these companies must be doing SOMETHING right to make a new 52 week high(ignoring the fact that the MARKET has the right to overpay and overvalue companies).
Yet Buffet approaches stocks the complete opposite way(who's richer and more stable?) and looks for companies trading CHEAPLY but yet still provide a great product and the market is just mispricing it low in the short term(market has good says and bad days).
Cramer is a POS clown who fluffs up his record. His job is to ENCOURAGE trading and pretend he was a fan of a stock the whole time(tesla, under armour,) yet he is just a goof.
130% move off the bottom for Deckers, barely a mention from the guy. Who is he realy looking out for? We hit a new 52 week high. We are innovating. We are trading cheaply for any UNEXPECTED growth.