Why Raisin Bran Is a Better Y2K Bet Than Tech

Cramer says the market will probably rally over Y2K, but not yet. In the meantime, he thinks Raisin Bran looks like a good buy.
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As I poured my Raisin Bran this weekend, I was struck by how there aren't any Y2K issues involved in raisins or bran.

IBM

(IBM) - Get Report

wishes it could say the same. So does

Lexmark

(LXK)

, which at this very moment is telling us about the freeze in spending because of Y2K that it is seeing right now.

This Y2K situation seems to dovetail rather perfectly with the

Gulf War

. People hung back from buying everything during the fall of 1990 because of the inevitability of the war. Every day we had a draining of confidence as oil would spike daily and interest rates went up. Like Y2K, we were hopeful that once the shooting started it would go smoothly. Like Y2K we didn't know if it would.

But before I get too negative, there is one big difference: The gloom from the Gulf shrouded

everything

. Retailers were doing poorly. Autos poorly. Chemical companies were getting hit. Banks, already shaky from the savings-and-loan crisis, were getting whamma jamma'd by declining real estate prices.

Now, Y2K is only shrouding tech. In 1991, with the war hours away, the market began to rally. You had to get in ahead of the bombs bursting in air. If you got in too far ahead, you got hammered. If you got in after, you missed it. A part of me tells myself that for the tech stocks with Y2K problems, it will be just like that. You will have an exquisite moment to buy. It just isn't here yet.

Which makes Raisin Bran that much more timely right now.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may 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

jjcletters@thestreet.com.