The Bush administration, with Treasury Secretary Henry Paulson taking the lead, proposed broad reforms for Wall Street Monday, but “the Democrats are not going to let this happen,” Cramer said during Stop Trading!.
With the White House at stake, Cramer continued, there’s probably little chance of a bipartisan agreement on how to regulate the financial markets, which have been in turmoil for the last eight months.
“I think [the Democrats] can say, 'We want to be constructive,’” Cramer said, “but it’s important that they be destructive because they’re political.”
Cramer shrugged off the notion that Paulson, as a former Goldman Sachs chief executive, knew the markets were headed downward a year ago, which is when the Treasury secretary said he first began working on the proposals announced today.
“He didn’t know what was going on,” Cramer said. “None of these guys knew what was going on. They just got engaged about three weeks ago.”
Cramer also scoffed at the idea that this big-spender administration wouldn’t want a weak dollar in an environment where industrials are the only sector working, saying such talk is “disingenuous.”
Speaking of the weak dollar, Cramer offered up some plays worth trading off the declining greenback: McDonald’s , Coca-Cola , Heinz and the new Phillip Morris. And even despite today’s bad news, he’s still bullish on Schering-Plough , which should earn $1.40 a share this year, Cramer said.
Watch Cramer's exclusive video with Schering-Plough CEO Fred Hassan Monday night on Mad Money at 6 & 11PM ET.
Jim's charitable trust owns Goldman Sachs, McDonald's and Schering-Plough.
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