Leadership of the Rally Is Suspect

This is a rally without Citigroup (C - commentary - Cramer's Take), without General Electric (GE - commentary - Cramer's Take), without American Express (AXP - commentary - Cramer's Take) and Bank of America (BAC - commentary - Cramer's Take).

This is a rally off a level that we held before when the fundamentals were substantially better for everything but LIBOR.

This is a rally where the promise comes from the oils, which is not a good thing, because we need gasoline to stay down; and from tech, which is irrational given that we just learned about the next leg down.

I don't want to read too much into AXP/GE/C/BAC, but I would rather see the rally concentrated on those stocks and not Chevron (CVX - commentary - Cramer's Take) and Exxon (XOM - commentary - Cramer's Take), as the latter two are so easily manipulated up as to be embarrassing. They are pure ETF plays where the ETF tail can wag even the biggest companies in the world -- except the banks, where no amount of ETF-buying seems to be able to move the group.

I would trust the rally to be worth more than the 200 to 400 points from here if the financials led it.

But this leadership -- the Potash (POT - commentary - Cramer's Take), the Mosaic (MOS - commentary - Cramer's Take), the Chevron, the Freeport (FCX - commentary - Cramer's Take) -- is at the front of an inflation-based rally, and to me that's simply preposterous.

The only thing that works in this kind of market is to buy the dividend stocks as their yields grow by half-point increments, still look for the ones that haven't moved and the recession-resistant stocks. Occasionally you get an intersection, such as Chevron at a 4% yield, but for the most part it's the Procter (PG - commentary - Cramer's Take) / Clorox (CLX - commentary - Cramer's Take) contingent, augmented by the better yielders like Nucor (NUE - commentary - Cramer's Take) and Caterpillar (CAT - commentary - Cramer's Take).

Random musings: U.S. Steel (X - commentary - Cramer's Take) again hits the level that is akin to the 1932 decline,. I wonder if the people at AK Steel (AKS - commentary - Cramer's Take) wish they had pursued that $30 or $40 deal that was rumored to be occurring.

At the time of publication, Cramer was long Procter & Gamble, Freeport-McMoRan, Chevron and GE.

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