Is this article by Jim Cramer the kind of refreshing analysis you crave? (not)
>>Time to Bid Biotechs Farewell
By James J. Cramer
1/5/01 4:09 PM ET
URL: thestreet.com
When the Fed seemed to be frozen in time, more worried about inflation than about recession, a posture it had as recently as a couple of months ago -- oh Lordy!! -- the biotechs were all the rage.
We weren't sure why. There was a nifty debate on the site about why that was. Some speculated that it was because of exciting product introductions. Others speculated that it was just a bubble, the last bubble, in fact, now that storage had been reduced to rubble (although still-expensive rubble when you consider the McDatas (MCDT:Nasdaq) of the world, or roaches like Inrange (INRG:Nasdaq)).
I think it was because people thought the Fed was going to lead us into a recession and nobody would be worried about biotech earnings -- or lack thereof -- in a recession. In fact they were the safest place. Now, though, as the stock market heads down here, forcing the Fed to move ever faster, the economy will spring back to life faster and you will want to buy stocks with earnings that are going up. And sell biotech.
I think this selloff is for real. I don't like to sell stocks down 11, like Human Genome (HGSI:Nasdaq), or down 7, like Genentech (DNA:NYSE). But if they were to rally a tad, I would exit. These stocks will be sells on aggressive eases. Bide your time if you are long them. They are always capable of bouncing and I never made good money selling into a panic, which is what is going on in the BTK (the American Stock Exchange Biotechnology index). But for my money, this group, which, of course, is part of a bubble, has had it.
Time to skidoo. These stocks look like they will go down every time the Fed eases, and it will be easing aplenty in a very short time.<<
Marc |
