Cramer: Breaking links of correlation
Jim Cramer | [email protected]
To me these were all ephemeral linkages, the stuff of hedge funds playing off certain patterns that weren't etched in stone and instead were momentary when our economy was linked, lockstep, with those overseas.
They were signs of fragility in the system. They were signs that we were either going to go back to the great recession or stabilize.
But with Europe out of the emergency ward, courtesy of lower bond yields and refinanced banking institutions, the big black holes have been patched up and we no longer have to be hostages to commodities.
We have come to view commodities as separate unto themselves and not indicative of anything other than excess supply. Their declines no longer signal that we must sell everything that's not nailed down.
Notice that I said "everything." For a long time we would sell down the foods and drugs on bad commodities pricing as hedge funds were just whipping around the S&P 500 futures on a daily basis in relation to commodity inputs that made no sense at all. That finally seems to be behind us.
It's incredibly aggravating to me that those who used to live and die by this stuff simply stopped doing so without any explanation or justification. If these things were so important, aren't they still important? But we hear nothing.
May I just add that they are like the ideologues who also try to control things by shoehorning the "action" into their political views. Eventually we will realize that their political views meant nothing at all. And they were only in play during the dark old days when there was talk about nationalizing the banks and taxing people to the max. All of that is now off the table.
And the ideologues? They should leave the table just like those risk -on/risk-off and commodities followers who turned out to have no clothes on.
Ideological emperors and commodity-based emperors: You are naked.
Go put some clothes on and get out of here.
Disclosures: Cramer's charitable trust has no positions in the stocks mentioned.