Mad Money

Cramer: This could be a sea-change in the market

Cramer: How Apple is powering the new industrialization of America

Jim Cramer has a message for all of the doubters of the market rally out there: stop thinking this is a rally.

Instead, realize that this is a sea change, where the market is no longer influenced by the things that used hold it back before President Trump won the election.

"We are now captive to far greater forces than most people realize," the "Mad Money" host said.

Gone are the days when the market tanked every time someone from the Federal Reserve opened their mouth. Gone are the days when investors were caught in a tug-of-war between Democrats and Republicans.

When Cramer looked at the new-high list on Monday, he realized that with exception of a handful of defense contractors, stocks are rallying because of the expectation that there will be worldwide economic growth without inflation.

Apple CEO Tim Cook looks at a display of the new 9.7' iPad Pro during an Apple special event at the Apple headquarters on March 21, 2016 in Cupertino, California.
Getty Images

Technology stocks in particular have roared since the election, with Apple hitting a new closing high on Monday. So much of the rally has roots that started in Silicon Valley, Cramer said.

When industrial stocks head higher, many investors think that it is because more orders are coming in. Cramer disagreed, stating that the real story is that many industrial companies have invested in technology. Thus, when they do receive orders, they are able to fil them more profitably than before.

The same thing goes for bank stocks, Cramer said. As they vault higher, investors should be thinking about the cloud and mobile technology that these companies will turn to for maximizing profits.

Thus, the price of Apple's stock is not determined by the White House. Yes, it has a large cash hoard overseas that could benefit from Trump's agenda of repatriation, but that's not the main thing powering Apple higher.

"What is really driving the stock of Apple is something quite different. A realization that Apple's worldwide sales are coming in better than expected, its service revenue stream is on fire and its design and manufacturing supremacy is leaving long-time competitor Samsung in the dust," Cramer said.

Apple is really a consortium of winners, in Cramer's book. As Apple succeeds, it pulls many other business areas with it, from the semiconductors that go into the iPhone, to the glass on the screen, to the software that powers the apps that go in to the phone, to the phone companies competing for business.

Some may consider the sea change in the market to be reflection of the new industrial America. Cramer considers it the old industrial America, which is using technology to dominate and prosper in a world that is less bound to the White House than many realize.

"Lots of investors still think Trump is the only thing driving this move and he can take it away with a tweet. Personally, though, I think it's about more than that," Cramer said.

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