show that weak consumer spending is a figment of some people's imaginations, Jim Cramer said on
Stop Trading! session.
Cramer said Wall Street and the media have been wringing their hands about the sharp decline in discretionary spending that they say will accompany any drop in housing prices. But Cramer said bullish comments from management on Tuesday's Deere and Home Depot calls suggest those fears are wildly overblown.
"A lot of discretionary spending is going on," Cramer said. "Your home is not imploding."
Cramer added that strength in Deere's lawnmowing business should protect the company from pullbacks in spending on home construction, and that complaints about executive compensation at Home Depot have grown old. "Maybe Nardelli isn't the biggest jerk after all," he said of the Atlanta-based company's CEO.
Cramer said "everyone's a winner" in Tuesday's marketwide rally, but he cautioned that the good feelings could be fleeting.
"There's a bet being made that Ben Bernanke's a genius," Cramer said, laying out the so-called soft-landing case that depends on
chief Bernanke rolling up interest rates enough to contain inflation fears without starting a recession. Cramer cautioned, though, that the Bernanke rally could evaporate Wednesday should the consumer price index show a stronger-than-expected increase tomorrow morning.
Cramer said tech stocks were up Tuesday in large part because they had already "hit the pavement." But he warned that he doesn't expect to see biotech
participate in any coming rallies because of management's poor credibility with investors.
At the time of publication, Cramer had no positions in stocks mentioned.
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