Cramer: Well, What Did People Expect Amazon to Do With Whole Foods?

 | Aug 24, 2017 | 6:54 PM EDT
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Stock quotes in this article:

amzn

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cost

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kr

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hain

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hd

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shld

Really, what did people think would happen with Amazon (AMZN) and Whole Foods? Did people figure that Amazon would take already high prices that Whole Foods has and raise them even more? Did people think that this was about raising the gross margins of Whole Foods and Amazon?

No!

It's about cutting them. It is remarkable how thoughtless those who own Costco (COST) and Kroger (KR) or Hain (HAIN) might be. The chatter on this deal the WHOLE time was that this kind of pricing would occur.

Now I know that some might have thought that it could happen later, not sooner. But were they in for some sort of trade involving food inflation or something?

Now what this speaks to is how hard it is to own retailers who truly do compete against Amazon with no price advantage. No price advantage, no premium multiple.

Same deal with Home Depot (HD) . The fact that Sears (SHLD) said that it is ramping up Kenmore-Amazon in California was enough to knock down HD.

We know that not everyone can fall prey, as I wrote earlier today, but can we just now assume that if you own shares in a company that competes with Amazon without any proprietary reason to win, that you are in with mo-ron shareholders like those who fled today.

In other words, no bottom, not yet. Not until we get a total washout that some had to believe thought had occurred that most certainly, after today, hasn't.

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