Boohoo Obama Needs to Cheer Up
Sentiment is so negative right now it’s “out of synch with reality,” Cramer said on Monday. The last time perceptions about the market and economy were this off the mark, Cramer was screaming, “They know nothing!” at Washington. Well, he took up the cause once again, hoping to convince viewers that the US has seen some very important changes since Lehman Brothers collapsed.
Lehman filed for bankruptcy one year ago Tuesday, and a host of glass-half-empty pundits claim that nothing’s different. The banking system still functions without new and improved regulation, they’ve said, much-needed transparency is nowhere to be found, and the securitization of toxic paper continues unabated. Even President Obama – “who should be taking credit for a system that’s stronger than ever,” Cramer said – sounded downbeat today during a speech to Wall Street. But the Mad Money host had a different take on things.
“The truth is,” Cramer said, “we’re in much better shape than anyone could have hoped for a year ago, despite the pessimistic chatter.”
Housing, the epicenter of the crisis, has gotten a boost from an $8,000 tax-credit incentive, but the sector’s rebound shouldn’t lose steam when the government ends its program in November. Not with mortgage rates and home prices so low. “Cash for clunkers” did its job, jump-starting the autos industry and clearing out inventory, which is something no one thought possible last September. At the same time, mobile Internet is driving a big portion of the tech sector, and retail is thriving, even though no one seems to think so.
Also, FedEx and UPS , key indicators of economic health, are “optimistic,” Cramer said, commodities markets are “healthy,” and we could be on the cusp of a “gigantic new aerospace cycle” now that Boeing’s much-delayed 787 Dreamliner looks ready to take flight. Natural gas, of which the US has quadrillions of cubic feet in potential reserves, could also do its part to lift us further out of the recession by replacing oil as a bridge fuel and thereby reducing the trade deficit. And fuel prices are cheap now, too, which has been a boon to companies like Dow Chemical , PPG Industries and Owens Illinois .
Cramer continued his list of positives – a strong dollar, low interest rates, solid banks like Wells Fargo , Goldman Sachs and others – but his point was that “none of these amazing positives” are talked about, “even in the president’s speech.” Cramer said that anyone who fails to see the glaring differences between then and now are “out of step.” He was right back in August 2007, and he thinks he’s right again about one very important thing.
“The system has been saved,” Cramer said.
Cramer’s charitable trust owns Goldman Sachs, PPG Industries and Wells Fargo.
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