Jim Cramer must be reading my posts

Like most everyone who can do math, I have spent many hours trying to figure out how President Obama will reduce the deficit, or spur growth in the nation, as he proposes $3.5 trillion for his budget. But I wanted to stop to discuss something I was just told.

It seems that around 6:45pm or so, Jim Cramer was asked his opinion of Alcoa. He stated that the stock is a speculative buy. Aren’t you shocked?

Well if you have been reading what I’ve said you wouldn’t be.

“There are companies in these sectors, or related ones, like Alcoa that trade at below book value now. This is an interesting value. But expectation of near-term growth is null. Yet at some point the vital raw goods will be needed, and demand plus speculation must drive the prices higher. And as that price rises, without another sector to compete with any real assurance, there will be a run..”

I know about Cramer's comment because I was just told about his comments from a friend that I was discussing the markets with earlier today. And my friend likes to keep account of the predictions and outlooks I have for the economy.

Now I know some people are looking at the market environment and thinking, ‘Alcoa may be cheap, but I want something that will move.’ It won’t happen.

President Obama has unveiled a budget of $3.5 trillion, filled with smoke an mirrors at almost every turn. Funded on the backs of the “rich”, which I take to mean higher taxes on the middle class. He is seeking to further stall any growth in investments with higher capital gains taxes. He is looking to crush the ability of private business to rebound with higher corporate taxes and Government intervention.

If anyone is looking at the market with the thought of a return horizon under 2 years, I feel they are foolish. It’s just not a reality. And even in that timeframe, assuming the pipedreams of Democrats are half-realized and just half-effective, the best return will average to about 15% after taxes.

But that is a matter for another day. I’m just going to bask a bit in the fact that Kramer is several days late and paying higher prices than what I called for. The difference may be minor, but the fact is that in this market, just getting vindicated is all you can really expect.