Cramer Credits Tech Stock Rally to Immunity from Obama, 'Politburo Chief' Pelosi
CNBC "Mad Money" host Jim Cramer credits lack of government regulation with a recent market jump in technology stocks. The tech-heavy NASDAQ composite (NASDAQ) shot upward 3 percent, from July 8 through July 23, even defying other market indexes that had down days in the same time period.
Cramer theorized on his July 23 show that the tech sector during that time period, despite the setback on July 24 in the wake of news that Microsoft (NASDAQ: MSFT) reported lower than expected earnings - because of government.
"So, now let me explain a pattern that I've discerned that could be incredibly important - important for you to take profits on if President Obama regains his clout and starts pushing hard with the rest of his agenda," Cramer said. "Everyone today wrote him off because of health care. I got to tell you, you can't write this guy off. He's too darn popular."
Cramer explained that there are underlying, always not-so-obvious reasons beyond the fundamentals of a company that can push a prolonged rally.
"Let's look at the streak the tech stocks have had here," Cramer said. "The NASDAQ has now closed up 10 straight days, 12 days. When you see something like that, you got to take a step back and ask yourself, ‘Is there something going on that's bigger than all the visible themes - the ones that I've talked about on the show endlessly - the low semi-conductor inventories and product cycles based on the mobile Internet, and valuations that just got too low.'"
That reason - a reluctance by Washington to regulate the tech sector on profits, compensation and other areas that the politicians have their eyes on.
"There is," Cramer explained. "I figured it out. Washington doesn't care about tech. It's not trying to legislate tech out of its profits. It's not trying to handcuff tech into pay, having a higher cost. That's right, I'm telling you tech is immune from President Obama and more importantly Politburo chief Nancy, I mean Democratic chieftain Nancy Pelosi. And that's why tech can go higher."
The "Mad Money" host also explained the tech sector was impervious to card check, cap-and-trade and other liberal hot-button items the Obama administration is attempting to push through Congress and that had a lot to do with its success.