Philip Morris Has Finally Been Smoked Out

It's time for MO to drop out of the DJIA and let Microsoft in.
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Pssst -- want to get the Dow back to 10,000? Let's throw out Philip Morris (MO) - Get Report and put in Microsoft (MSFT) - Get Report. Think about it. MO no longer trades on its fundamentals. In fact, it never will. It is increasingly reminding me of Owens Corning, A.H. Robins and, yes, that old Dow stock itself, Johns-Manville.

I know, we have

Union Carbide

(UK)

in the Dow and that weathered Bhopal. We also has

Exxon

(XON) - Get Report

with the

Valdez

. But those were discrete events that could be quantified, however outsized.

AT&T

(T) - Get Report

and

IBM

(IBM) - Get Report

faced antitrust suits, but those didn't crush either company, although it led to the breakup of one of them. But MO is now trading strictly as a proxy for lawsuits.

What can MO do about it? I don't know. It tried paying all of those states for

Medicare

; no dice. It tried to get some protection in Congress; forget about it. It tried to beat back all of the cases and succeeded for years until people had the evidence they needed to convince juries that it wasn't always the plaintiffs' fault. Now, it is entering a brave new unrepresentative era, just the opposite of what the index is supposed to indicate. And it looks like we are at the beginning of a wave of suits.

If it were just a downturn in butts, I'd say, don't boot it. But this is a secular problem that will hobble MO -- I hate to say it -- forever. Time for the biggest company, the one that virtually determines the performance of whole other indices, to join the Dow. Darn the four letters, full speed ahead.

Random musings:

Great holidays to all!

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long Microsoft and AT&T, although positions can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

letters@thestreet.com.