Jim Cramer says investors need to take a 'longer view' to survive this volatile market
Cramer said that the market is "incredibly oversold" and that there's "no reason" for the selling to continue.Cramer said that the market is "incredibly oversold" and that there's "no reason" for the selling to continue. He thinks that anyone who thinks they know what's going to happen in the next
The Key Points
He said that the history has shown that high-quality stocks are the best way to navigate a volatile market.
Cramer discusses the fear that banks seem to have over investors
Jim Cramer, CNBC's Jim Cramer said Tuesday that investors are operating out of fear too much and should instead take a long-term view of the market and "accentuate what is positive."
Cramer admitted that investors have legitimate concerns and that this market looks like the sum of all our worries. Cramer acknowledged that investors' worries are not unfounded. The past year was marked by consumer pressure, economic strains in China and Russia, a decline in office real estate, and, most recently, huge bank failures.
Cramer said that selling and cashing out in these uncertain times is not an option, particularly since "we don't know" the long-term effects of external events.
Cramer, for example, pointed out the recent collapse of Silicon Valley Bank which raised initial concerns that the Great Recession might repeat itself. This led to a sell-off in oil and industrials that was feared would be affected by bank-run contagion. First Republic Bank and other regional banks were stable Tuesday, after Janet Yellen, Treasury Secretary, said that bank deposits would be protected. This resulted in investors returning to oil and industrials.
This reversal showed that investors make decisions based on short-term concerns and not long-term analysis.
Cramer also observed that some market participants were unwilling to do anything Tuesday due to Federal Reserve Chair Jerome Powell's announcement on Wednesday of his next rate change. Cramer stated that people who invest based on fear of the future aren't thinking long-term enough.
Bottom line: Anyone who believes they know what the future holds has been proven wrong. Cramer said that if you look at the bigger picture, you will find yourself owning stocks in high-quality companies with strong balance sheets.