We Have Pulled Back From the BSC Brink

(Editor's Note: RealMoney is free to all TheStreet.com readers until Monday night. We hope you enjoy this article. If you would like to subscribe to RealMoney, please click here.) Are we better off than we were when we had the middle-March scare from Bear Stearns (BSC - commentary - Cramer's Take)?

Is Lehman Brothers (LEH - commentary - Cramer's Take) better able to handle the downturn, or the shorts for that matter? Is the Philadelphia Housing Sector Index (HGX) going to slice through 129, and are Centex (CTX - commentary - Cramer's Take), KB Homes (KBH - commentary - Cramer's Take), Lennar (LEN - commentary - Cramer's Take), Pulte (PHA - commentary - Cramer's Take) and D.R. Horton (DHI - commentary - Cramer's Take) going to come under withering attacks again? Is Toll Brothers (TOL - commentary - Cramer's Take) the sole survivor?

I actually think things are better now. Capital has been raised, lots of real estate has been sold, there's a sense that if you cut price for a home it will sell, and we have legislation in the hopper that will put the brakes on foreclosures, slowing them down to a more manageable level.

The only thing that has changed is earnings power/dilution. We have had so much capital issuance in the financials and so little business done that we need another round of cuts and another cut in earnings per share.

The difference is viability. I think the viability of the investment houses, this time around, is much greater. When I read through the bearish case at Lehman, it isn't about bankruptcy, it is about earnings power, and a place like Lehman, run by Dick Fuld, knows how to cut back when earnings per share are faltering.

I do not believe things are good. My take here is to buy nothing until the only things that have saved us in this market before, the oscillator at minus 5 and the bulls in the mid-30s, happen again. At this pace, it's going to happen sooner rather than later.

At the time of publication, Cramer had no positions in stocks mentioned.

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