CNBC’s Jim Cramer said Thursday that the stock market was hammered this week by a “set of bogus worries” from commentators and “misguided money managers.”
The “Mad Money ” host said investors were unnecessarily worried about the possibility of lower interest rates from the Federal Reserve, China devaluing it’s currency and earnings.
“Now that the dust has settled and the averages are rebounding like crazy … it’s clear that selling stocks into the teeth of the sell-off earlier this week was a big mistake,” Cramer said. “This was an FDR moment, where the only thing you had to fear was feat itself, because so many of those worries were totally groundless.”
U.S. stocks closed higher, Thursday erasing most of the steep losses from earlier in the week, as global bond yields rebounded while investors digested better-than-expected trade data out of China.
Stocks had sold off at the start of the week on concerns about the impact on global economic growth from the escalating trade dispute between the U.S. and China.
President Donald Trump announced last week that the U.S. would impose 10% tariff on another $300 billion worth of Chinese goods, effective Sept. 1. China later retaliated. The tactics amplified a trade fight that has rattled financial markets and threatened to drag on the global economy.
Cramer has suggested the U.S. economy is better than the recently embattled stock market has reflected recently, telling investors that they are being “faked out” by tanking U.S. equities. He argued that investors and TV pundits need to “dial back the rhetoric” and to look at the “reality of the companies that are reporting” solid earnings.
“Here’s the bottom line: it’s easy to foment panic. It’s easy to spread fears of a recession. And, hey, if I really believed a slowdown was imminent, I’d by screaming it from the rooftops like I did in 2007 and 2008. But we just don’t have those circumstances now,” Cramer said Thursday.
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