NEW YORK (Real Money) -- Jeez, the market's in a foul mood. It is interpreting everything positive as a negative and it is reading through anything bad as if it trumps the good. Anyone who says stay the course is getting creamed and is regarded as whistling past the graveyard. Must Read: Jim Cramer’s Picks for What to Buy in Oil and Biotech Into 2015 But I can't look at it like that. I am stuck with the facts that we are in a negative moment that calls for antidepressants because, as rational as it might be to sell oil companies and even to sell some financials because of lower commodity prices and lower interest rates, I think that when the market recovers from its bout of selling, there might not be all that much opportunity to get back in. But for a moment, let's just bow to the negatives. I truly do believe that oil's not done going down and neither are the oil stocks. Oil has a habit of overshooting on the downside, and you can see that there's no room and I can see there's no room, and it's so obvious that oil has to go lower that it is remarkable it hasn't already done so. When I look at how Wall Street is positioned on oils, I am equally as shocked that there is still a sanguine attitude, as if there might be a bottom and you don't want to miss the bottom. Now, I think that there is NO HURRY to buy the oils, none at all. My status has been clear: you need to see number cuts and downgrades galore, and until every bull is slaughtered, there's no reason to own them. And when I say every bull, I am talking about the need to say all buys go to holds or sells. We are so far away from that, it is a bit mortifying, as most of these analysts don't seem to understand that these stocks are still up substantially as a group and that makes no sense. These were growth stocks that are now trying to find their way to value level and that takes time. Anyone trying to get in front of a move from growth to value knows that not only does it not happen overnight, but it takes several quarters of pain before people even realize that they are buying stocks that are expensive on earnings, as virtually all the oils are. That's 10% of the S&P 500 that is overvalued. Must Read: 7 Best and Worst Chemical Stocks for the Era of Lower Oil Prices There's a second group that's now become overvalued short term and that's the financials, because of the sudden decline in interest rates that is taking peoples' breaths away. We are now recognizing that the Fed isn't even a factor anymore. It's the dollar, it's the worries overseas, it's the desire for safety and, if you are anywhere in the world and you are wealthy, you think you are about to lose money, and so you buy Treasuries. Bank managements were hoping that this was the year that they would get some rate relief and the Fed would tighten. Now it looks like it doesn't matter what the Fed does, rates are going lower. So, the bank stocks have to go lower. Now how low? Low enough to trim, but not to sell all because the group's just too cheap. I think you have to accept some pain and own the goods ones. I said the same about Wells Fargo on Squawk Box. We know that Wells Fargo isn't set up for lower rates. It does better in higher rates. We know that this company will most likely not report the earnings number that people want. Numbers most likely have to go down. But what does it do? Go to $49, $48 down $3, $4? As much as some would think, this isn't 2008 when Wells lost four-fifths of its value. It's far more likely that it is similar to October of 2014 when an Ebola scare caused the stock to sell off to $47 from $52. Then it was a straight shot to $56. Can you be that nimble? Maybe a hedge fund can be knowing that its earnings may not be as good as expected. Short-it-now-cover-later kind of thing. But isn't it better, when there is no systemic risk to Warren Buffett's favorite bank, that you just tough it out? Then how about the international stocks that are headquartered here. Let's take General Electric , which is getting whacked, down 2% on a Deutsche Bank analyst downgrade and estimate cut in part because of a slowdown in the rest of the world (GE's less than half domestic). It's also getting hit in part because of how much of its business is now energy related, including its recent Alstom acquisition, the French engineering firm it just bought for $15 billion. No one wants engineering or France right now. Do you bolt? Even as I see limited upside as oil goes down, you would be selling a company that has no systemic risk -- it has an oil business, it isn't an oil company -- and has a 3.83% yield with 10-year rates below 2%. Maybe it has two more points of downside. If that's too much for you, you have my blessing to sell. I would rather hold it at this point at $24 down from $27, even though I am not encouraging you to buy it. Must Read: When Must I Buy a Stock to Get the Dividend? This downgrade comes on the heels of a downgrade of Caterpillar , a company with much more energy exposure than General Electric that needs strong economies worldwide, or at least improving economies, to beat its numbers. It doesn't have them. Even at its 52-week low of $85, I am not all that tempted by Caterpillar because it traded below here at the end of 2013 when oil was doing well and China seemed to be doing better. Now, should we extrapolate GE and Caterpillar to the whole industrial group and sell them all? I think that's a mistake. Companies that have oil exposure that do a ton of business overseas and will be hurt by both the declines in those economies and a strong dollar are going to be too painful to own into earnings period. But companies that benefit from lower oil, with good yields and not that much economic exposure overseas? Those are buys, not sells. Now then, why is the market going down at all? First, we were up double digits last year. Second, there is a panic belief that the world must be coming to a stop because of how quickly oil has fallen and how fast interest rates have declined. Third, people are selling because they are trying to get ahead of what will happen when oil goes to $40, if it does, because that's where you can expect bankruptcies in the oil patch, including the most-stretched companies in the business. Me? I say accept the foul mood. Respect it even because financials, some industrials and all oils have to readjust to the downside. But two out of three of those have already done what we call enough work on the downside that I don't feel like it is rational to sell -- remember it is a mood we are dealing with not a reality-- given that we know that lower rates and lower inflation historically have produced gains, not losses in the vast majority of stocks. So, surrender to the pain if you must. I would rather think about the gains that could be around the corner when you have a selloff that's got some speed to it. Oh, and remember this: think of the Ebola pullback. How many times did people say wait for a pullback and then they got one and people panicked, thinking that Ebola was going to destroy the earnings of so many companies. We are having the pullback. Are you using it or are you waiting for lower prices or are you panicking altogether? I can condone waiting for lower prices, I can condone buying the stocks of companies that benefit from lower oil, I can condone selling of the oils and some financials if you are nimble, but don't look to me for the get-out-now call. Must Read: Bank of America’s 10 Top S&P 500 Stocks to Buy for 2015 Editor's Note: This article was originally published at 1:46 p.m. EST on Real Money on Jan. 6. Been there, did that, and the situation just isn't that dire to warrant such a declaration.
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