For back-to-school season, Cramer said Staples' ( SPLS) conference call tells him that PC notebook sales are really strong. "That's a core Intel ( INTC) product and Hewlett-Packard ( HPQ) product." Cramer owns both EMC and Hewlett-Packard for his charitable trust.
Investors who got caught up in the morass of the Long-Term Capital Management mess in 1998 missed the multiple expansion prevalent in a lot of the high-growth stocks benefiting from interest rates coming down. "I remember in particular America Online exploded to the upside in 1998," he said. "That was the beginning of when you started having the dot-com explosion, and if you focused only on whether Citigroup ( C) was going to come out of this hole, or whether Bankers Trust was going to make it, you missed the easy money." Cramer owns Citigroup for his charitable trust. In 1998, "Long-Term Capital was a discreet hedge fund that had the ability to take down pretty much every broker because they had borrowed a lot of money," Cramer said. "Here we have a lot of different hedge funds that have borrowed a lot of money but nowhere near the size of Long-Term Capital." Whereas the current crisis in subrpime involves a gigantic spread of problems, in 1998, it was a concentrated spread, Cramer said. Long-Term was a large hedge fund that would have failed if it weren't for a Fed-led bailout. The quantitative fund got into trouble when Russia announced it would default on its debts. The U.S. stock market fell 20% in reaction, and European markets dropped 35%. Investors flocked to Treasury bonds, driving interest rates down a whole point.