Oil and Government Blocking the Way

Today is such a microcosm for this miserable market. We have good research saying that tech stocks have come down too much. We know that the banks are setting themselves up for record quarters.

But the federal government is creating a world that makes us feel like we should be investing in another country -- once again last night I said China is right, we are wrong. The judgment of oil is the swift sword that wipes out every rally.

Oil and government -- both doing the wrong thing and going the wrong way -- conspire to kill any rally.

I still believe that the tech recommendations can will out today. I still believe in the PowerShares QQQ (QQQQ - commentary - Trade Now) trade and in the "crowded short" theory that Doug is propounding.

But what is playing out is the kind of debate I am going to have with Ron Insana tonight. There's just too much bad to give us a rally. Defense is still the way I want to play. Government (meaning failed plans to fight unemployment, coupled with cap-and-trade and a climate of anger toward business) plus oil (meaning the wiping out of the manipulation trade) seems to beat anything good, including the fundamentals!

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

Random musings: People who say that margin rules shouldn't be raised to head off speculation don't seem to understand that willy-nilly credit is the enemy of sanity! I pushed for the Fed to raise margin rates during the dot-com period, to quell speculation that ultimately led to a collapse of stocks. I thought the Fed should focus on stopping credit creation in the mortgage market to head off a bubble. Why should the oil market have different rules? How do these apologists explain the need at all for margin requirements. Maybe we should have no money down? These apologists for the system never accept that the $147 oil price that almost destroyed the U.S. consumer was caused by reckless margin and over-leverage and too much credit creation.

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Know What You Own: In Friday's trading, the most active stocks include Bank of America (BAC - commentary - Trade Now), the S&P Depositary Receipts (SPY - commentary - Trade Now), CIT Group (CIT - commentary - Trade Now), Citigroup (C - commentary - Trade Now), the PowerShares QQQ (QQQQ - commentary - Trade Now), iShares MSCI EMF (EEM - commentary - Trade Now) and the Financial Select SPDR (XLF - commentary - Trade Now).

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