Listen to the Joystiq Podcast (because your ears can't read)

AOL Money & Finance

Cramer on BloggingStocks: Keep a close eye on tech

More

Jim Cramer on BloggingStocksTheStreet.com's Jim Cramer says a comment by the Cisco CEO about systems spending caused more damage than it should have.

Everyone thinks we lost tech. That's because everyone was hiding in tech. They thought it was "safe."

Perhaps we confused tech with Coke (NYSE: KO) (Cramer's Take) and Pepsi (NYSE: PEP) (Cramer's Take).

First, the root cause of all of this is the somewhat off-handed comment about how the financial services industry has cut back on spending for systems.

We never want to hear any company say anything about spending cuts by customers. It is intriguing that the only place where spending was hit was by these customers. It was enough to kill all tech, though.

Is it right? If tech hadn't been so hyped and if tech wasn't so linked to financial services, I don't know how much we would be down.


I do know this. These stocks are all being taken out and shot on Chambers' comments.

Oh, and it doesn't help that the best ad-serving technology out there, Quigo, just got bought by AOL in a very smart move, thereby hampering the Google (NASDAQ: GOOG) (Cramer's Take) case, which had been one of the best in tech.

I think that is an overreaction, of course. But we are no longer in earnings season, so the defenses won't come easy. You can't expect other tech firms to come out and say, "Chambers is wrong," because he isn't.

To me, what you have to do is decide whether every other tech company is as beholden to this particular part of the business.

Or, to get less emotional about it, is Cisco (NASDAQ: CSCO) (Cramer's Take) Caterpillar (NYSE: CAT) (Cramer's Take), which is uniquely levered to housing, and are we selling Emerson (NYSE: EMR) (Cramer's Take), Eaton (NYSE: ETN) (Cramer's Take) and Parker Hannifin (NYSE: PH) (Cramer's Take) (52-week high) because of it? Are we selling Ingersoll (NYSE: IR) (Cramer's Take), which has gone out of its way to say it isn't CAT, because of it?

I would try to find the stocks in tech that have less exposure: Intel (NASDAQ: INTC) (Cramer's Take), Corning (NYSE: GLW) (Cramer's Take), Hewlett-Packard (NYSE: HPQ) (Cramer's Take), Microsoft (NASDAQ: MSFT) (Cramer's Take) and Apple (NASDAQ: AAPL) (Cramer's Take) say, and watch them as test cases to see when we bottom.

Only after we catch a bottom in those can we safely wade in the water.

Watch and wait. Because right now the innocent are all guilty. We need to be sure who isn't, before we can pull the trigger.

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long Caterpillar and Hewlett-Packard.

RELATED LINKS

Five Dumbest Things on Wall Street

Jim Cramer's Portfolios of the Week

Reader Comments (Page 1 of 2)

| 1 | 2 |
Symbol Lookup
IndexesChangePrice
DJIA-223.328,280.74
NASDAQ-49.201,796.52
S&P 500-26.91896.42

Last updated: July 04, 2009: 10:02 PM

BloggingStocks Exclusives

Hot Stocks

DailyFinance Headlines

Latest from BloggingBuyouts

TheFlyOnTheWall.com Headlines

BioHealth Investor Headlines

WalletPop Headlines

My Portfolios

Track your stocks here!

Find out why more people track their portfolios on AOL Money & Finance then anywhere else.

BloggingStocks Partners

More from AOL Money & Finance

WalletPop Headlines