Skip navigation
MOST POPULAR RELATED TAGS
  • TOPICS
  • SECTORS
  • COMPANIES

MAD MONEY FEATURES

Podcasts PODCASTS
Watch the Lightning Round whenever and wherever you want.




Widget OFFICIAL MAD MONEY WIDGET
Grab this all-in-one application and get recaps of the show sent right to your desktop or blog.




Soundboard CRAMERS SOUNDBOARD
Admit it: You've always wanted to hit the "They
know nothing!" button. Here’s your chance.




Mad Money PhotosCHECK OUT OUR PHOTOS
Check out Cramer on set, back to school, behind the scenes and more.




ShopSHOP FOR MAD MERCHANDISE
Buy Cramer books, bobbleheads and other Mad Money merchandise.




Ringtones RING TONES
Pick up the phone! It's Cramer! New Mad Money sounds for your cell phone.




Mobile AlertTEXT MESSAGE ALERT
Mad Money's mobile. Get show highlights sent to your phone.







Text Size
Apr.20
7:24 PM ET
Monday, 20 Apr 2009
A New Beginning?

Sure, the Dow dropped 290 points on Monday, but don’t panic. This pullback was just a blip on the screen after six weeks of tremendous gains on Wall Street. There are signs that a new business cycle is beginning, Cramer told Mad Money viewers, “and it could very well turn out to be a good one.”

A number of factors are at play that softens the blow of today’s losses. For one, President Obama is finally on board, having dropped his anti-stock talk of late February/early March. Some of the market’s big declines came when the White House was repeatedly understating the averages’ importance. Well, not anymore. And Obama seems to have forgotten his initial call for changes in the tax code, charity deductions and cap-and-trade emissions standards. This is a main reason March saw such a strong rally.

Also, the professoriate and punditocracy, as Cramer called them, have quieted their calls for bank nationalization, and that, too, is a sign of change in the market. Plans put in place by Washington, by both the Federal Reserve and Treasury, are resolving the toxic assets weighing on company balance sheets, while stronger banks like JPMorgan Chase [JPM  Loading...      ()   ] are scooping up their ailing peers. These are all positives that make Monday’s dip less worrisome than if it had happened six weeks ago.

Another key point, though, is that all the excess inventory that companies once held has been sold off, so new orders should start to rise again. This has happened across some of the economy’s most important sectors: housing, autos, computers, even retail. At least that’s what recent reports from Intel [INTC  Loading...      ()   ], Best Buy [BBY  Loading...      ()   ], Nokia [NOK  Loading...      ()   ], Corning [GLW  Loading...      ()   ] and others have said. Add in banks’ renewed ability to lend, and you have the makings of a new business cycle, which, of course, is crucial for a sustained move higher.

These are the bullish reasons to believe in Cramer’s long-term thesis. Days like Monday are, in fact, a part of that general trend higher, not evidence that the theory’s been disproved. We are in a recession, after all. But the possibility of a depression has been taken off the table. So investors should stay in the game. Cramer expects more good news to come.


Cramer’s charitable trust owns JPMorgan Chase.

Questions for Cramer?

Questions, comments, suggestions for the Mad Money website?

© 2009 CNBC, Inc. All Rights Reserved

Tools:
PrintEmailAdd This share icon
Next Post
  • digg share
ADD COMMENTS
Remaining characters


Current DateTime: 05:21:40 25 Nov 2009
LinksList Documentid: 29778428

Current DateTime: 01:03:47 25 Nov 2009
LinksList Documentid: 29779196

Current DateTime: 02:05:46 25 Nov 2009
LinksList Documentid: 29779199

Current DateTime: 01:02:04 25 Nov 2009
LinksList Documentid: 29779198
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2009 CNBC, Inc.  All Rights Reserved.
A Division of NBC Universal
Thomson ReutersThomson Reuters