NEW YORK (Fortune) - Thinking about Big Oil and food this morning ...

KRAFT: Company is laying off 8,000 workers over the next two years and closing 20 plants. Well, as Ronald Reagan, used to say, I'm not surprised. Yes the Number One food company in the land has a cornucopia of terrific brands including Oreos, Jell-o, Maxwell House, Oscar Mayer and Ritz crackers, but KFT (Research) is being squeezed on the low end by generics and on the high end by offerings from stores like Whole Foods. Also more folks than ever are eating out. Interestingly Kraft which is 85 percent owned by Altria (Research) was spun off by that company in 2001. Since then the stock has gone, point to point, nowhere. While Altria, powered by its subsidiary, Philip Morris is up 50 percent -- as tobacco litigation winds down. The spin-off was to set Kraft free, not the tobacco company! I'd be wary of any company that makes Lunchables...

KNIGHT RIDDER: The good news is the stock has a P/E of 9.6. The bad news is that fourth quarter earnings just came in and they're down 22%. Yikes! And it's not really an aberration. Newspaper stocks are very depressed as online venues, like Craig's List, steal away advertising revenue. So far no newspaper company has figured out how to fight back or incorporate the Internet into their business models. Folks like Don Graham at the Washington Post are trying.....Beware, this is a classic value trap. KRI (Research) is cheap, but will likely get cheaper....

EXXON: You may have seen Exxon's massive annual profit. $36 BILLION dollars. Revenue of $371 billion. (No, Dr. Evil, that's with a 'B.') Not a bad profit margin for an industrial company, by the way. If XOM (Research) was a country it would be the 17th largest in the world by GDP, bigger than Switzerland, Hong Kong and Sweden. Anyway, I've got to eat some crow here. A few years ago Wal-Mart became the biggest company in the Fortune 500 (by revenues), and I said it will be the biggest for years to come. OOPS! That was when oil was $25 a barrel. Today it's $68. Me no think of that. Is Exxon a buy, even though it's close to an all-time high? Listen up here real good. Exxon is always a buy. (P/E of only 11) That is until we have a new energy source. I don't see that yet or anytime soon ... And I bet the stock outpaces the market over the next five years too

Loose Change: Interested to hear the State of the Union address tonight and see how the President characterizes events in Iraq, Iran, and Palestine. Tough row to hoe if you ask me......Did you see the footage of that bull going into the stands at Mexican bullfight? CNN colleague Drew Trachtenberg tells me they've renamed him Ron Artest.....

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Email Andy Serwer at serwer@fortunemail.com.