Political Risk Enters Market via Kerry

In the next 10 days, it will become clear that John Kerry is the candidate for the Democratic Party. It wasn't supposed to be like this. Kerry, while not a good campaigner, looks and acts presidential, which is a big leg up on the other guys. He is occasionally conservative, although always veers liberal -- too liberal for me, I'm afraid -- in the end.

But so what? He was awarded a Silver Star, the U.S. military award for gallantry in action. Nobody in his right mind is going to attack a Silver Star winner for being soft on defense, and if he did he certainly wouldn't get away with it in a national election (although they sure did it in Georgia to Max Cleland.)

Which means there is going to be a race here, a real race, one that isn't over before it starts as it was with Howard Dean.

Plus, Kerry's rich. He's one of the richest men in the country, as long as he stays married to heiress Theresa Heinz, and history teaches us that lots of money can win in politics.

To me, that spells political risk. I don't know anyone who thinks that Kerry would be as good for Wall Street as Bush has been. But I also know that New York Attorney General Eliot Spitzer, my friend and formerly an investor in Cramer Berkowitz, the hedge fund I ran, endorsed Kerry. And he did so only after spending a lot of time with Kerry about the scandals on Wall Street.

Kerry, it seems has a real candidacy going. I think that when that officially dawns on people, the market's going to take a bit of a breather, if not a tumble.

I had been reluctant to write this until I truly could get my arms around the election. I figured there was still a chance for Dean. I think Dean's candidacy-- whether he admits it or not -- ends tonight.

So the political risk increases starting Wednesday and will run until everyone feels this way, which is probably a 10-day affair.

You have been warned.

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James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS by clicking here. While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column to [e-mail]. Listen to Cramer's RealMoney Radio show on your computer; just click here. Click here to buy Cramer's latest book, "You Got Screwed!" Click here to order Cramer's autobiography, "Confessions of a Street Addict."