The Oil Crisis and the Flight to Quality By James J. Cramer

Originally posted at 1:36 PM ET 10/12/00 on RealMoney.com

We seem to be replaying the 1990 situation more closely than I would care to talk about on this site. I don't want my strong Middle East feelings to color my writing here on the site. But to me, the 1990 parallel makes me feel like we are pretty much still in the month of August of 1990, the so-called second leg down, when it became clear that oil wasn't coming down any time soon.

The crisis is keeping bonds from selling off -- flight to quality. But that's where the differences with 1990 end. Oil will keep the Fed on hold and will keep buyers from bottom-fishing in the financials because a sustained spike in oil will chill consumer spending while also causing credit problems.

We are all contrarians at heart. I am sure there are some of us who want to say buy at the sound of gunfire and sell at the sound of bells ringing with peace. This kind of conflict, however, won't end like that. So, I take no heart in betting that way. Better just to watch and wait and hope, and yes, pray.

But I said I wouldn't go into that.

http://www.thestreet.com/comment/wrong/1122585.html

-- Martin Thompson (mthom1927@aol.com), October 13, 2000