Jim Cramer of CNBC Article on August 14: "Though Hardly Bearish, Cramer Grows Less Bullish"
The article describes Cramers caution due to Macy's disappointing earnings announcement. The article goes on to describe how Cramer explains that there are not enough catalysts in the economy to support the stock market if we lose the consumer. He also cautions that areas like financials could be hurt as higher interest rates take a bite out of housing. In other words, without the consumer the economy takes a hit and as a result the stock market loses steam.
Well, let's see if we all understand this correctly:
The stock market crashes in 2008-9.
Real estate crashes.
Financials face a crisis and the Fed bails them out with tax payer money (read: consumer).
Corporations cut back dramatically and let go of staff (read: consumer)
Corporations earnings skyrocket as a result of layoffs and stocks subsequently surge making a handful of beneficiaries super wealthy (read: NOT the consumer)
Corporations will only hire part time workers at reduced wages and reduced hours (read: lower discretionary incomes).
Now, four years later, after a massive surge in profitability and cash hoarding by corporations (read: no CapEx spending) the consumer must be relied upon to spend so markets can maintain their momentum and it's up to the consumer (read: on his back) to do this? Really? While corporations sit on a reported trillion dollars in reserves? Really, again?
Sorry, Mr. Cramer, but this is asking a bit too much just so you can maintain your bullish sanguinity on your CNBC program. Welcome to the real world where most people are struggling to get by and not participating in the surge in equities that they helped support. How about if the markets give some back?
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