After the huge rally on Thursday in the wake of the

Fed

's rate hike, investors are back to worrying about the Fed's next move, said Aaron Task on Jim Cramer's

"RealMoney" radio show Friday.

Task, co-executive editor of

TheStreet.com

, is filling in for Cramer this week.

The market on Friday was flat, as people are now worried the Fed will have credibility problems if inflationary pressure picks up over the summer and it has to tighten rates again, he said. This is leading to a division in the marketplace, Task said, referring back to Cramer's June 7 show during which he talked about the three camps of investing.

First, there is the hard-landing theory, where people believe the Federal Reserve will take interest rates too high and cause inflation, he had said.

Second, there is the soft-landing thesis, according to which people believe the Fed rates will go up gently until the economy cools. Once it cools, the Fed will be finished raising rates, Cramer had said. In this scenario, earnings in the economy are not destroyed and it does not result in a recession.

A third camp has emerged recently, Cramer had said. In this camp, there is a slowing of the economy, but a speed-up in inflation. In the hard and soft landing theories there is no acceleration of inflation, just a diminution of it, he had said.

"I want to disagree with the third theory,

also known as the stagflation theory," Cramer had said. "Because the only thing that works in the third camp is gold."

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On May 12, gold hit $730, and on June 7 it was at $630, Cramer said. This told Cramer the Fed is wrong, because in a stagflation scenario gold should be going higher.

As of June 7, he had said, banks were moving up. This happens in a soft landing. If we were going through or nearing a recession, the banks would be near default.

Gold continued to fall throughout the month of June and was rallying on Friday, and is up big, Task said, adding that Cramer is right and people should keep an eye on the price of gold.

Responding to a listener's email, Task said the stagflation scenario that occurred in the 1970s is less likely to happen today, even though commodity prices are breaking out, because we are more of a service economy than a manufacturing economy, so higher energy prices are not as big of a problem for corporate America today as they were in the 1970s.

"Today, the biggest costs for companies is their employees, which is about 70% of corporate costs," he said.

Also, Task said that the fact that workers are less likely to be in a union today than in the 1970s, combined with the threat of outsourcing making it difficult for employees to ask for more money, make a 1970s stagflation scenario less likely.

Sempra's Sweet Spot

Sempra Energy

(SRE) - Get Report

is in a great position right now because we are heading into the hurricane season, and that means we are probably going to see higher natural gas prices, Task told a caller.

He advised the caller to put a stop in at $44 (the stock was recently at $45.46).

Although alternative energy plays are legitimate, they are more speculative long-term plays, he said. Right now, natural gas, oil, and other traditional energy makes up the bulk of the resources we need, and Task believes Sempra is well-positioned to benefit from that.

Palm's

( PALM) quarterly statement did disappoint, Task told a caller. However, the company's guidance for the full fiscal 2007 year was above expectations so some people may think of it as a buying opportunity when taking a long-term view, he said.

Task's guest, Cody Willard, president of CL Willard Capital and a contributor to

RealMoney.com

, said he likes Palm from a long-term perspective. It is cheap and he believes it will earn a lot of money in the next three or four years.

Although the stock is getting hit hard off bad guidance, Willard said he wouldn't chase it, but nor would he be selling it with a longer-term view.

Akamai Technologies

(AKAM) - Get Report

has tripled in 12 months, Willard said, adding that he likes the company and believes it is well-positioned, but expensive.

When a caller inquired about

Johnson & Johnson

(JNJ) - Get Report

Task said that after buying

Pfizer

's

(PFE) - Get Report

consumer products line, the stock got hit because there was concern that they overpaid for those assets

Johnson & Johnson paid $16.5 billion, which is four times the revenue that the consumer products division was earning for Pfizer, Task said.

However, he believes it was a great move for Johnson & Johnson as the consumer products segment is a faster-growing business than the pharmaceutical business. Task said he sees the fallen stock as a buying opportunity and believes down the road this acquisition will be looked upon as a savvy move.

There has been a lot of opportunity in big-cap, stable, blue-chip stocks like

Home Depot

(HD) - Get Report

, Task told a caller.

However, the problem with Home Depot is that the Fed's tightening has put downward pressure on the real estate market and not as many people are buying homes, he said. Home Depot is suffering from that.

Task suggested the caller to look into big-cap retailer

Wal-Mart

(WMT) - Get Report

, which he said is a stock that has a chance to turn around here.

Staying Pat

Task asked guest Cody Willard, president of

CL Willard Capital

and a contributor to

RealMoney.com

, whether he has repositioned himself in the market since the Fed's move on Thursday.

Willard responded that he has not repositioned himself, and he missed Thursday's rally. Although many people believe what the Fed did yesterday was a bullish sign, Willard said it hasn't changed his point of view.

"The fact of the matter is the fed raised rates again," he said.

Willard said he doesn't expect a hard landing later in the year, but said the dislocation in so many different markets makes him believe that it isn't a good time to be aggressive. He said he is waiting for the market to cycle itself out and he's not in any rush to get back in.

Microsoft Muscle

Microsoft

(MSFT) - Get Report

recently announced the delay of it Office 07 product, as well as plans for co-founder Bill Gates to step down, Task said.

In addition, there is talk that the company may need to break up or change their management or both, he said, asking Willard how concerned he is on the matter.

Even with the pushbacks, Microsoft is still generating billions of dollars of cash every quarter, he said. They have $50 billion of net cash on their balance sheet, so even if they bring out Office 07 in late 2007, Willard believes they are building up a pent-up demand.

He does not believe the company is dead money or that he is suffering opportunity costs by staying in it, he said. He is up on the stock from when he bought it six weeks ago, while the

Nasdaq

is down double digits since that time.

"I don't look at what the stock has done in the past, but want to look ahead and see where I am going to make money in the future," Willard said, adding that he truly believes Microsoft is a potential "double" over the next couple of years.

In light of the news that

Apple

(APPL)

is being faced with options backdating, Willard said this is the first time since March 2003, when he first bought the stock, that he is considering getting out of it entirely, he said.

"I don't think it's good that the company is disclosed and has gone to the SEC and said they might have options backdating or options irregularity," he said.

Aaron L. Task is the co-executive editor of TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships.

Click here

to send him an email.