Drugs Should Rotate Back Into Favor

Fitting that this market's whole story comes down to Zyprexa, an anti-psychotic drug by Lilly (LLY - commentary - Cramer's Take) that makes you less delusional and more accepting of the harsh realities out there.

Because that's precisely what we need to take right now. The harsh reality is that everything from personal computers to big-screen televisions, from cell phones to main frames, from large computer services to semiconductors is slowing. That whole world of tech has just been undone.

At the exact same time that the tide seems to have turned on liability, the rage for Canadian drugs has died down and the drug companies themselves have rationalized their structures to the point that they may be more profitable than they were in the old days.

You see, it is not so much that Lilly might trump IBM (IBM - commentary - Cramer's Take) -- as Doug Kass wrote on our sister site last night -- but that the drugs offer the perfect alternative to the deteriorating economic picture. Or, to put it another way, Pfizer's (PFE - commentary - Cramer's Take) as good as Motorola (MOT - commentary - Cramer's Take) is bad. Plus, you get a nice dividend!

I don't think people realize how much economic activity is being put on ice right now. Whole industries that had been booming, like trucking and transportation, have just been poleaxed. Autos are in depression. You can't ask housing to do any more than it has.

At this exact moment, in walks Lilly with news that its earnings are much better than we thought. In walk Merck (MRK - commentary - Cramer's Take) and Schering-Plough (SGP - commentary - Cramer's Take) with cholesterol drugs that are necessary. Or Genentech (DNA - commentary - Cramer's Take) with its Avastin. Heck, next thing you know, Bristol-Myers (BMY - commentary - Cramer's Take) will win some patent dispute and Aventis (AVE - commentary - Cramer's Take) will buy it.

I know there are people out there right now saying, "Cramer, you hated the drugs." These are the same people who always email me and tell me how much I loved the Red Hots. Sure I did. And the Nazz went from 2000 to 5000 overnight and I got what I could out of it. And then I moved on.

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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. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click here to get his second book, "You Got Screwed!" and click here to order Cramer's autobiography, "Confessions of a Street Addict."