We’ve reported before that Cramer doesn’t think the market will go below the July 15 lows. He even has six reasons for that (we like that, arguments..). However, there are a number of ultra bears out there that argue that we haven’t seen nothing yet, and they too have arguments..

First Cramer, his six reasons:

• A bottom is forming in the housing stocks, signalling a bottom in the housing market that he says is coming in 300 days.
• The Federal Deposit Insurance Corp. has announced a plan to fix ailing banks, allowing stronger entities to buy good assets while the government assumes the bad loans.
• Both presidential candidates are likely to lower individual tax rates, which will help spark consumer spending.
• Commodity prices have crashed across the board, helping to lower the raw costs for every company that uses commodities.
• The price of gasoline is coming down even lower than Cramer first expected. “This is almost a tax cut in and of itself,” he said.
• The stock of Wal-mart (WMT – Cramer’s Take – Stockpickr), a place where millions of Americans shop, is showing some strength.

A bottom in the housing market in 300 days, now there’s a prediction! There are some signs that he might be on to something though:

• Sept. 4 (Bloomberg) — Sales of distressed Miami properties have begun, signalling a bottom for south Florida’s real estate market and the end of waiting for vulture funds armed with about $30 billion to spend.
• “There’s a purging going on,” McCabe said. “It’s my belief that the vulture buyers would form the bottom of the real estate market, and we’re almost there. That bottom may last for three years as foreclosure sales go on.”
• McCabe estimates that at least $30 billion has been earmarked by funds to buy distressed Florida real estate. Some investors have been waiting almost three years to buy, he said.

A bottom that may last for three years as foreclosure sales go on, hmm, that’s already a little less specific, but it will have to do. We showed earlier a piece from The Economist with some more indications that housing might be bottoming.

This is important, as we have argued several times that housing is key to the economy.

Another nice indicator is the following:

• It might seem like only oil-rich foreign governments have any cash to invest these days. And they have lots, more than $2.5 trillion by a Morgan Stanley estimate. But don’t count out cash closer to home. Merrill Lynch reports that total investable money right now in hedge funds has hit $156 billion, the highest since data collection began in 1992. The data considers just net cash in NYSE broker accounts.
• “Hedge funds have de-leveraged and continue to increase their record cash balances, which will be a very powerful source when they decide to come back to the market,” Merrill Lynch analyst Mary Ann Bartels tells Bloomberg. “The significant amount of cash on the sidelines is a contrarian bullish” indicator for U.S. stocks, she says.

However, we also argues that US stocks are expensive, and there are plenty of bears out there..

Financial tsunami coming

• Sept. 4 (Bloomberg) — The U.S. government needs to start using more of its money to support markets to stem a burgeoning “financial tsunami,” according to Bill Gross, manager of the world’s biggest bond fund. Banks, securities firms and hedge funds are dumping assets, driving down prices of bonds, real estate, stocks and commodities, Gross, co-chief investment officer of Newport Beach, California-based Pacific Investment Management Co., said in commentary posted on the firm’s Web site today.“Unchecked, it can turn a campfire into a forest fire, a mild asset bear market into a destructive financial tsunami,” Gross said. “If we are to prevent a continuing asset and debt liquidation of near historic proportions, we will require policies that open up the balance sheet of the U.S. Treasury.”

Considering Cramer’s background in hedgefund land, you sort of expect him to have the right view, but we wouldn’t even completely exclude the possibility that he’s trying to generate some buying volume to help out a few of his old pals (although we don’t think that’s very likely either, but one has to realize that the financial markets are most certainly not a level playing field).

Here another bear:

Credit crisis in infancy

• The credit crunch which has dragged on for over a year now, may still be in its infancy. Starting next month, banks in the United States and Europe must begin paying off hundreds of billions of dollars they owe by selling assets and issuing expensive new debt. “The gears of capitalism are grinding to a halt,” Mirko Mikelic, senior bond fund analyst for Fifth Third Asset Management, told Bloomberg. “There is a tremendous concern over the banking sector and a scramble right now for capital.” The flood of debts now coming due are the result of a boom in short-term bond issuance between 2005 and the first half of 2007 that led banks to take advantage of some of the lowest borrowing costs on record. The banks’ debts, structured as floating-rate notes, will come due over the next year or so, just as banks beleaguered by subprime problems are trying to raise fresh capital in order to stay afloat.
• By the end of this year, big banks and investment banks like Goldman Sachs, Merrill Lynch, Morgan Stanley, Wachovia, and U.K. lender HBOS must each pay off more than $5 billion in floating rate notes, according to a recent report from JPMorgan Chase. The problem doesn’t end there. Big lenders like General Electric, Wells Fargo, and Italy’s UniCredit Group also face bills coming due in coming months, the report says.
• JPMorgan analyst Alex Roever says financial institutions will have to pay off at least $787 billion in floating-rate notes and other medium-term obligations before the end of 2009. That’s about 43 percent more than they had to redeem in the previous 16 months, the Wall Street Journal reports. Bank representatives say they’re fully able to meet their obligations, either because they’ve already accumulated the funds needed to do so or because they have ample customer deposits they can tap. But, the rates they’ll have to pay if they want to issue new debt will be much higher than they were two years ago.

This is a story we don’t like, to be frank. It opens up the possibility that housing is not the most important crux of the economy. On the other hand, Cramer argued above that the Federal Deposit Insurance company is on to the case. That remains to be seen. We wouldn’t bank on it..

And then there is this guy:

Big bear?

• David Tice has made himself famous for successfully shorting stocks. Now the investment manager sees a bear market for the next five years, with share prices dropping 50 percent to 70 percent over the next 18 months. That would put the Dow Jones Industrial Average somewhere between 3,425 and 5,708. “We believe stocks have benefited from an unbelievable credit bubble” that is now bursting, Tice told Bloomberg TV.
• “Policymakers and central bankers have perpetuated a bubble like we’ve never seen before, with mortgage financing that has put government sponsored enterprises (Fannie Mae and Freddie Mac) in trouble,” he says. “The whole structure of the financing mechanism, where foreigners bought all these [mortgage] securities, has broken down. Institutions and foreigners no long trust our structure, insurance, ratings, etc.”

A sort of financial Armageddon. It’s hardly surprising that if you have pinned your career on being short, you come out with gloomy predictions, but as far as gloomy predictions go, this is, well, quite something.

The next president has his plate full..