Cramer's 10 Reasons to Be Bullish

Is the bright side the right side?

When I read Doug Kass's excellent about-face case for a year-end rally, I believe I have to address the possibility that we could go higher from here, perhaps dramatically, because of some things that could happen and some things that have already happened. Here's a list of 10 things that have been and could go right that would propel us up 1,000 points -- to my Dow target -- by year-end.

1. The stock market is cheap. Most of the stocks I follow are in low or mid-teen multiples or at a price-to-earnings ratio vs. high growth rate that I regard as being just flat-out cheap, particularly when you consider a 4% 10-year Treasury. Retail at 10 times earnings? Lots of high-growth tech stocks at mid-teen multiples? It makes no sense to me.

2. Takeovers and going-privates could come back. On a large scale we saw BHP Billiton(BHP Quote) make a move today for Rio Tinto(RTP Quote). On a smaller scale there's money to go private, witness Restoration Hardware(RSTO Quote).

3. There are some very strong bull markets out there. Health care cost containment, agriculture, oil and oil services, infrastructure, tech and aerospace defense. There are a lot of sectors that work.

4. Interest rates. The financials are so dire that the Fed will have to cut twice by year-end or give us another half-point cut, which will flush a huge amount of money from the sidelines and embolden banks to start lending again.

5. The market still loves high growth. Witness Google(GOOG Quote), Research In Motion(RIMM Quote), First Solar(FSLR Quote), Apple(AAPL Quote) and Intuitive Surgical(ISRG Quote). Believe me, if this market were really bad, you wouldn't get those to go up, either.

6. The cheap dollar. The dollar, which everyone frets about, is just too darned cheap and the moment it bottoms you will see a wave of acquisitions from overseas that could blow your mind.

7. Oil. Oil could find a level where it just gives us some breathing room and allows the world to adjust to higher prices.

8. The government. The federal government or the Fed actually steps up and buys AAA and AA tranche CDOs to get things moving again. This is simply not that hard a task, but they haven't shown any inclination to do a thing so far. They could surprise us.