The “Fast Money” traders give their final trades of the day.
The “Fast Money” traders give their final trades of the day.
Jim Cramer prepares investors for the Fed to raise interest rates and shares his top rules for short selling in a low-growth environment.
First, they think that stocks are up right now because they are just vehicles that are being used for income and thus they will lose this status if rates go up. However, Cramer does not agree with that point of view unless there have been several rate increases already because a stock that yields even 3 percent is still more attractive versus bonds.
The second is the economy will fall apart as soon as rates increase because it is too weak to handle even the slightest move. Yet, Cramer has seen the economy experience whole quarters with dramatically lower growth.
The third misconception pertains to the critics who think that any time rates go up, the dollar will get stronger and exporters will be hurt by the translation of the dollar and overseas competition. While both of these issues do have a degree of truth to them, but Cramer warned not to get spooked and sell stocks too early when the Fed tightens because that could damage your portfolio too.
Ultimately rates are so low now that Cramer thinks the country would need to see significant increases in rates before there is a genuine impact to the growth of business.
“I don’t think you have to sweat these increases. However, that, again is not enough to assuage those who think the Fed will go on autopilot and raise and raise without being data dependent,” Cramer added. http://www.cnbc.com/2015/07/31/cramer-forget-it-you-cant-fight-the-fed.html
One group that always benefits from higher interest rates are the bank stocks because higher interest rates mean they earn more money from cash deposited. But what else will work besides the banks?
Cramer said companies that have the biggest year-over-year earnings revisions, such as the U.S. industrials that do not have a lot of overseas business, are a good bet as are the high-growth stocks that aren’t dependent on economic growth to do well, but can get a boost from the economy doing well. He also recommended restaurant and retail stocks that have already benefited from growth.
“Now these gains will be in fits and starts and will always be called into question from now on as the Fed tightens. But history is on the bulls’ side in the early rounds of tightening, as they tend not to cool off the economy drastically even as many will fear they will,” Cramer said.
Here’s what it boils down to:
Cramer anticipates there will be various three-day selloffs whenever a new piece of news comes out about a rate hike. On day one, all stocks will go down in a broad market selloff that is led by hedge funds and mutual funds that short the SP 500.
In the old days, Cramer used to buy bond market equivalent stocks on day two—that should no longer be the case. Instead, Cramer foresees money will gravitate to the
Jim Cramer thinks this market is about to change. In the future, the Fed will be raising interest rates, and that means investors must be more careful allocating capital.
“We recognize that the stocks bought for yield will be sold and that bonds with low coupons—low interest bearing paper—could be dangerous,” the “Mad Money” host said.
With this in mind, many investors will want to create short positions against the market. And while Cramer is not allowed to create short positions in his Charitable trust, he did short almost every day when he worked with Karen Cramer at his hedge fund. In fact, Karen Cramer hated long positions and loved the short side.
And Cramerica is just in luck, because Karen Cramer shared her short-selling rules with Cramer. Rules that are timeless and can still be applied today.
Rule No. 1: Called the Business Week cover rule. At the time, this publication often featured companies on the cover and their stocks would often jump following the issue’s release. Thus the rule to never short a company that could be on the cover of a big publication was born.
“I have augmented this rule and it’s very simple: never short a best-of-breed company. There are so many crummy, awful companies out there, why bother to short a company that is a standout that could be considered among the best of the best just because you are
The movie star has had many hits over a blockbuster 30-year career, but has never had a film open to more than $100 million in the U.S., according to Rentrak (. )
His latest film, the fifth installment of “Mission: Impossible – Rogue Nation,” doesn’t look like the one that will break the barrier.
However, Cruise has a lot to be happy about “Rogue Nation,” which he stars in and produced.
The Paramount film, which opens this weekend, has already brought in an estimated $4 million thanks to Thursday night preview screenings and is projected for a $40 million to $50 million opening in the U.S.
The action spy thriller is also sparking fire with critics with a 93% fresh score on reviews site, “Rotten Tomatoes.”
One of Cruise’s most remarkable hallmarks, however, has been the durability of his career that has made him one of Hollywood’s most consistent box office stars.
Here are some quick stats on Cruise’s U.S. box office over the years according to Rentrak:
— From 1992’s “A Few Good Men” to 1996’s “Jerry Maguire,” Cruise had
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Upgrading to Windows 10 using “express settings” will automatically make Microsoft (Tech30) Edge your PC’s default Web browser, even if you used a different browser when your PC was running Windows 7 or Windows 8. ,
You can still make Google (Tech30) Chrome, Mozilla Firefox, , Apple (Tech30) Safari or another app your default browser in Windows 10, but it’s not as easy or intuitive to do that as it was in previous versions of Windows. ,
Here’s how to do that:
1) Click the “Use this as my default browser” button. That will launch the Settings app, opened to the “Choose default apps” tab.
2) Click on the Microsoft Edge logo. Picking a browser won’t immediately be visible: You’ll have to scroll down to where it says “Web browser,” and click on Edge.
3) Click on the browser of your choice. You’ll be prompted to choose an app. Then close the window to save your changes.
Choosing “custom” instead of “express” settings during the Windows 10 upgrade installation will
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Big Oil earnings have nosedived in the past year. The latest results that came out Friday were even worse than expected.
Chevron ( announced a 90% drop in earnings on Friday. It went from bringing in $5.7 billion in the second quarter of 2014 to hauling in a mere $571 million this year. )
Exxon Mobil ( isn’t much better. It raked in $8.8 billion in profits for the second quarter of 2014. This year, it earned less than half that amount — $4.2 billion. )
The problem for these companies is well known by now: Oil and gas prices have plummeted from over $100 a barrel last summer to under $50 now. It’s a lot harder to make money when you can only sell your product for half of what it used to be worth.
Many experts don’t see oil prices rebounding any time soon. July was actually the worst month for oil prices since October 2008.
The world simply has too much oil for sale these days as the Middle East continues
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CNNMoney has confirmed that the company has closed a new round of funding of nearly $1 billion.
According to PrivCo, a data provider on privately-held companies, this values the firm at close to $51 billion. That means it surpasses Chinese smartphone company Xiaomi as the most valuable privately-held company. Xiaomi was most recently valued at $46 billion, according to PrivCo. Airbnb comes in third; it’s valued at over $25 billion.
Uber’s valuation has increased by $10 billion in just seven months, said PrivCo research analyst Chris Pisarski. The company had raised $1.8 billion at a $40 billion valuation in just December.
While it took Facebook (Tech30) nearly seven years to achieve a $50 billion valuation, Uber has hit it in just five years. The service operates in more than 300 cities in 58 countries. ,
The new funding comes from investors including Microsoft (Tech30) and Bennett Coleman Co., an India media conglomerate. These are new investors to Uber — or at least newly disclosed investors, according to PrivCo. (Previous rounds have included undisclosed funders.) Microsoft declined requests for comment. ,
Zuckerberg’s announcement that Chan is now pregnant with a baby girl prompted thousands of congratulatory Facebook (Tech30) messages on Friday, and some of them were extraordinarily personal, with women’s stories of other miscarriages and the silence that often accompanies heartbreaking loss. ,
“My husband and I are going through the same thing,” a user named Bethany wrote. “We just had a miscarriage in May…so it’s nice to know I’m not alone.”
A user named Jennifer wrote of her miscarriages, “The pain is so intense and the sense of grief is real. Thank you for letting other couples know that they are not alone.”
Zuckerberg posted a picture and short essay to his personal Facebook page on Friday afternoon. He has 25 million followers, so the news spread very quickly.
“Most people don’t discuss miscarriages because you worry your problems will distance you or reflect upon you — as if you’re defective or did something to cause this. So you struggle on your own,” he wrote.
But then he struck an optimistic note: “In today’s open and connected world, discussing these issues doesn’t distance us; it brings us together. It
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