NEW YORK (Real Money) -- The holy grail of tech vs. the evil power of oil. That's what's duking it out this morning and, as long as the president stays away from the microphone, it could actually be a push.
What's the holy grail of tech? That's when Intel (INTC - Get Report) lifts sales, earnings and gross margins because of enterprise demand. Anyone who has followed Intel as long as I have knows that when you get that mid-60s gross margin and more orders than you can handle then the leverage is monstrous and the guidance conservative, simply because it can't keep up with the momentum.
Yep, it's happening, and it is happening just in time because the downward pressure from Iraq threatens to take out the entire consumer/transport leadership, and this market's desperate for a leader.
Intel's moment is here not just because of demand pickup, but because CEO Brian Krzanich cut back capital spending at the right time and also because he is getting out of the extraneous businesses and focusing on growth markets. You, see Krzanich's a return to the old days at Intel, when it was run by brilliant engineers, not by sales or marketing people. He's the real deal, and this kind of older tech leadership, with low valuations, real profits and a potential for increased dividends, suits the market's bulls entirely. I really like him because he gets that Intel has to think like the younger generation that worships the handheld and plays games -- he's a gamer himself -- something I wouldn't know if my daughter hadn't told me to check in with Reddit.com daily to stop being so old.
But more importantly, will it matter? It will if Brent calms down and the president devises a game plan that throttles back the terrorists, not something easily done because the only real way this crummy miserable government in Iraq seems to be able to tame the terrorists is with the equally terroristic thugs from Iran. The pox-on-both-your-houses scenario might be too dangerous and lead to all sorts of ramifications that renders the holy grail of tech meaningless, even as a return to enterprise spending is a godsend for so many companies in the universe.
Believe me, we would be discussing nothing but Intel if it weren't for Iraq, but that's a needless construct. It's something I tried to do with biotech back in 1990 when Iraq invaded Kuwait, thinking that the old Cephalon would withstand the pressure because its new drug prospects were so great that nobody would care about Iraq when that company had so much in the pipe. I was wrong and the pressure coursing through the airlines to companies like Target (TGT), nee Dayton-Hudson, was far too great.
So, let's see how it plays out. But I can tell you, if President Obama grabs the microphone today or even if the Republicans attack him again for napping, and West Texas Intermediate crude spikes to $110, you will be looking at Intel in the rear-view mirror, except in this version objects in the mirror are farther than they appear.
Action Alerts PLUS, which Cramer co-manages as a charitable trust, has no positions in the stocks mentioned.
Editor's Note: This article was originally published at 6:42 a.m. EDT on Real Money on June 13