Keep Your Eye on Kraft, Not Altria

Altria's (MO - commentary - Cramer's Take) cheap and just got cheaper because of this court ruling that puts the bankruptcy threat out of the picture.

But the real surprise is that you aren't getting any pop in Kraft (KFT - commentary - Cramer's Take), the type of thing you should expect if Altria's going to break up.

Here's how I think things will shake out. Altria wins the suit; that makes it so Altria can establish a BP Prudhoe Bay (BPT - commentary - Cramer's Take)-like royalty trust with tobacco and not worry that the feds will get all the revenue. What will it do with Kraft, though?

I keep thinking back to what Jim Kilts did at Gillette (G - commentary - Cramer's Take). He recognized that his most important shareholder, Warren Buffett, wanted Kilts to think big and create a consumer product colossus. So he called Procter & Gamble (PG - commentary - Cramer's Take).

Don't you think the people at Coca-Cola (KO - commentary - Cramer's Take) feel similarly inclined? Don't you think the beleaguered people at KO want to please Warren, too?

Well, why don't they call Altria and say, "We want to merge with Kraft."

Talk about a merger made in heaven.

The Altria 65 calls are going nuts as people suspect that with punitive damages off the table, Altria's free to do something big. But it is Kraft that will do the big things, not Altria. That's the one I would make the move on.

Random musings: Don't you think that J.P. Morgan's (JPM - commentary - Cramer's Take) Jamie Dimon is sitting there looking at American Express (AXP - commentary - Cramer's Take) and Citigroup (C - commentary - Cramer's Take) and saying: "If our stock is going to stay at $37 for one more day, I am going to explode in anger?" I think the stock's too overlooked here. But then again, I own it. And you have to believe that the AIG (AIG - commentary - Cramer's Take) folks are looking to unload their annuity division on someone, too; the stock trades like it.

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At the time of publication, Cramer was long J.P. Morgan.

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. 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."