CNBC’s Jim Cramer said on Tuesday that he remained largely cautious in the stock market until he saw tangible signs that the weakness was drawing to a close.
“The liquidation will eventually recover,” said the host of “Mad Money”. “I just think it’s worth the wait on the sidelines with fresh money until we find out how things can change, or your favorite stock gets crushed to the point where it’s too cheap. to ignore it, like Micron’s abrupt collapse after the close. “
Cramer said six main issues are contributing to Wall Street’s weakness, including inflation that appears to be more persistent than the Federal Reserve initially expected, high natural gas prices and supply chain disruptions. .
The other three, according to Cramer, are the coronavirus that is discouraging people from returning to the workforce, the uncertainty around the infrastructure bill in Congress, and the semiconductor shortage.
“The idea that everything is going to continue to be horrible, that those six dice rolls are going to pop out of snake eyes is too easy. Something will be right with one of them – it’s almost always the case. case, ”Cramer said, after the Nasdaq Composite sank 2.8% in its worst session since March. The Dow Jones Industrial Average fell 569 points, or 1.6%, while the broad S&P 500 fell 2%.
The three major US stock indices are firmly in the red for September.
“At this point, it’s only safe to buy stuff that has been completely mutilated or that could be coil springs.… My charitable trust, we only hit stocks that have lost 10% of their value by very shortly. We did some shopping today, “Cramer said.” We don’t sell. Why ? Because we have a lot of money and we like it when the market goes down so we can make it work. ”
While he believes the market will eventually recover, Cramer said he understands this is a tough time for some investors given the market’s continued strength since the March 2020 low caused by the pandemic.
“If you can’t take the pain, it’s not too late to sell something, but please only on a bounce, as long as you’re nimble enough to come down to a lower level,” he said. -he declares.