Cramer: 4 things I learned from talking to a dozen Club members and other investors over the weekend

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This stock market is torturous. After nearly a year of distress, investors are starting to accept the lack of ability to make money and the ease with which money has been lost. I spent yesterday in the City of Brotherly Love doing bottle signings for my wife’s Fosforo Mezcal, a tobala agave spirit that it the exact pick-me-up this market needs. Anyway, I always say I will talk stocks, sports and spirits. Philly is consumed by sports right now, on the cusp of what could be some of the most exciting days ever with Phillies advancing to the National League Championship Series and the Eagles off to a 6-0 start in the NFL. But the conversation always turns to stocks and I am always comfortable talking stocks. Here’s what I learned from my canvas of dozens of people this week — a group that is in sync with all the folks I talk to all the time when I walk around the New York Stock Exchange. 1. Most people are staying the course This too shall past. We know to ride it out. This is terrific from a historical point of view, because this stance has proven right over the up-and-down cycles of the past, as I pointed out in last week’s October “Monthly Meeting” for Club members. But it’s not so hot from a sentiment point of view, because it is so far from a capitulation that I fear an elongated bear market. I probably spoke to a dozen Club members and we all had a more resigned attitude, accepting that there aren’t many opportunities right now. Most were glad that I told it like it is — is there another way? — and didn’t sugarcoat that there’s not much to offer. There are a few stocks here that I like, nothing to pound the table on. When one of your favorite groups, a potential leadership sector, is the banks, there is no enthusiasm for the market. 2. Many have fallen in love with the 2-year Folks know they should be investing for the long term right now, but they also know that the yield on the 2-year Treasury is just under 4.5%. That’s a pretty good return, especially in this market. Sentiment followers: It’s a good sign that people no longer fear of missing a move, but a bad sign that they can park themselves in a 2-year Treasury and do much better than stocks. Most people were bummed that I didn’t like the market. But they were incredibly respectful. Most were watchers and they know I have been cautious. I think at another time they would wanted names–favorites from the trust say-but when asked, and I was, I responded by saying you should go watch last Thursday’s Club meeting and you’ll see how you feel. 3. They see too much junk in the market People have been burned by all the junk that’s been put out by the market’s puppeteers. Their reaction, for the most part, is that there are so many bad stocks that they should just invest in ETFs, preferably ones that track the S & P 500. They did seek verification that this was an okay strategy, given that I am a stock guy. All I could say was please be careful, you can lose money in an index fund, too. I asked everyone if they were in cryptocurrencies. Got a lot of “been there, tried that, lost money, no thank you.” I asked everyone if they were in special purpose acquisition companies (SPACs). More “been there, tried that, lost money,” except one guy who was a promoter in some SPACS. He got shares for nothing and made fortunes and continues to make fortunes because even down here it makes sense to sell. I think it is sad what the SPACsters and the brokerage houses did by favoring rich institutions and hurting them with bogus merchandise. Everyone’s been hurt by one or more of these. I fear that still one more generation has been destroyed by the greed of those who could not resist SPACs or IPOs of name brands that have no hope of being profitable. 4. They’re very tired This was the most sober and downcast I have seen people since 2008, the only difference now is a disgust with politics in general and Washington specifically. For what it is worth, no one blamed Federal Reserve Chair Jerome Powell. I asked if anyone owned any FAANG stocks. The answer: Tried it but lost too much money. No one would ever think about buying Meta Platforms (META) or Amazon (AMZN) or Alphabet (GOOGL) again. They still own Apple (AAPL) for the most part. Again, if you are coming to a bottle signing for Fosforo, you know my view about Apple. Inflation came up constantly, but there was also a sense of ennui about what can be done about it. Many of the people I spoke to wanted to try to buy property — there are some terrific up-and-coming neighborhoods in Philadelphia — but the rate hikes took that off the table. Bottom line So let me give you my main takeaway from all of these conversations: The market has worn people down. The bear has won. The lack of desire to discuss the market other than how bad it is has really become pervasive. I know there are clowns on Twitter who despise me and say that I got them in at the top, but I pretty much heard the other way, especially given that we turned bearish last November. Most just want to wait until the Fed is done raising interest rates and I am not one to criticize this view. I do say there will come a time when that attitude is too negative. But we are not at that time. All in all I am glad people are cautious. When oil goes down or when rates tick up, or the dollar goes higher and the market reacts to it in a vicious fashion, people don’t want to go anywhere near it. So they don’t. (Jim Cramer’s Charitable Trust is long META, AMZN, GOOGL and AAPL. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

Jim Cramer in front of the NYSE, June 30, 2022.
Virginia Sherwood | CNBC
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