Cramer Remix: Don’t let Wall Street convince you there’s a ‘Fed-induced bubble’

Real Estate

The idea that the Federal Reserve has created a bubble in stock prices by pausing its initially hawkish rate hike agenda sounds like “nonsense” to CNBC’s Jim Cramer.

“I can’t stress this point enough: When people talk about a Fed-induced bubble, they mean the Fed should be out there tightening aggressively and laying waste to the economy,” the “Mad Money” host said Tuesday after an intraday rally.

Why would people want the Fed to resume its aggressive rate hike agenda, a move that would almost definitely lead to lower stock prices? Cramer thinks it has something to do with hedge fund managers, who make up a large portion of this growing chorus and tend to make money short-selling stocks, or profiting on a bet that they’ll trade lower.

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“I think we should question the sanity of anyone who desperately wants the Fed to tighten,” he said. “They’re either crazy or they genuinely want stocks to go lower because they have way too many short positions on and they’re lagging the S&P 500.”

So, what’s the next move for homegamers?

“Take this idea of a Fed-induced bubble off the table,” Cramer said. “We have an economic expansion that’s been fueled in part by lower taxes, and that’s a good thing.”

Five fundamental trends are working in Wall Street’s favor and should keep people invested in the stock market, Cramer argued Tuesday as the Dow Jones Industrial Average soared on some Washington-induced hope.

“I think the facts favor the more hopeful view right now, so it’s worth staying in this market, as long as you recognize that if the trade talks break down, then we’re going to get a decent decline,” he said.

Cramer, a former hedge fund manager and longtime stock-picker, has seen a number of rifts emerge in this market that have led him to reassert his near-term bullishness.

From Morgan Stanley’s bold call that Wall Street will see an “earnings recession” in 2019, to the president’s mercurial stance on trade with China, to the daily swings in oil prices, to the bank stocks’ underperformance, it’s easy for investors to get lost in the shuffle as opposing sides pull stocks every which way, he explained.

So, to offer some clarity to those with a longer-term focus, Cramer flagged five things that can help investors “navigate [their] way through these confusing waters.”

Click here to view them.

The company that helped Kylie Jenner make almost $1 billion from selling her branded products is now moving into the cannabis space, its chief operating officer told CNBC on Tuesday.

Shopify, a Canadian e-commerce company that helps merchants set up online stores and sell products directly to consumers, recently announced that it would offer the same opportunity to Canadian cannabis merchants on the heels of the country’s recreational legalization.

Shopify is already known to have celebrity clients like Jenner, Kanye West and Drake. Now, the cannabis-related section of its website touts customers of pot-induced fame like Canopy Growth and Aurora Cannabis.

“The reason we started with Canada was there was clarity in Canada,” Harley Finkelstein, Shopify’s COO, told Cramer. “We felt it was really important for us to act quickly and effectively.”

Click here to watch and read more about his full interview.

The stock market rally that began 2019 has not yet run its course, even with Tuesday’s Washington-induced surge, Cramer said after consulting with technician Carley Garner.

“The signs suggest that this market can have more upside before the rally exhausts itself,” Cramer recapped on “Mad Money.” “Eventually the market will become too optimistic and stocks will peak, but we’re not there yet.”

Garner, the co-founder of DeCarley Trading and author of Higher Probability Commodity Trading, has an impressive track record. In mid-December, one week before the Christmas Eve collapse and subsequent rebound, she told Cramer that pessimism was peaking and stocks were due for a bounce.

But now that the S&P 500 has gained over 15 percent since those midwinter lows, it’s worth wondering the reverse: what if optimism is approaching its peak?

Lucky for Wall Street, Garner says it’s not.

Click here for her full analysis, as told by Cramer.

Ventas’ stock may have gained over 25 percent in the past 12 months, but that’s not stopping Chairman and CEO Deb Cafaro from steering her real estate investment trust on a more growth-focused path.

Cafaro calls it the “pivot to growth.” In the next year, she plans to leverage secular trends — particularly rising demand for senior housing, one of Ventas’ central businesses — as well as balance sheet strength, “external growth” and Ventas’ new research and innovation business to drive growth at the health-care facility provider, she told Cramer in an interview.

She may even “turn on the acquisition machine” as age-based demographics swing in favor of the $22.6 billion company, she said on “Mad Money,” calling the rate of growth in the 75- to 81-year-old group “unbelievable.”

“It’s growing 4 percent a year for each of the next five years,” Cafaro said. “Even the 82 to 86 [group] will start growing 3 percent a year starting in 2020. So we have great demographic demand.”

Click here to watch Cafaro’s full interview.

In Cramer’s lightning round, he zoomed through his responses to callers’ stock questions:

Synopsys Inc.: “It’s a good company. It’s design automation. I’ll give you a two-fer: I’ll also throw in Autodesk. I like that one, too. These are very strong stocks.”

MarketAxess Holdings Inc.: “You know we liked [CEO Rick] McVey when he was on. We’re not going to cash out up 21 percent. More upside.”

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