CNBC’s Jim Cramer on Wednesday told investors there will be a shift in Wall Street’s focus, from the actions of the Federal Reserve to those of President Donald Trump.
“We’re now looking at the changing of the guard from Powell to Trump,” he said. “It won’t be easy, as one’s a pretty predictable guy and the other’s a wild card.”
According to Cramer, the tone of the market over the past several years has been set in large part by the central bank and its decisions regarding interest rates. Since Covid, he continued, there’s been “endless handwringing” about the Fed, with cuts that sent the market soaring during the pandemic followed by a bear market in 2022 when it began to tighten. And when the Fed started cutting rates again late last year, stocks initially saw gains, but wavered as investors questioned the Fed’s credibility and bond yields climbed.
He suggested that former President Joe Biden didn’t focus on big corporations, so many investors shifted their attention to Fed chair Jerome Powell as the more prominent voice in the economic landscape. But Trump is more hands on when it comes to big business, Cramer continued, partnering and speaking with prominent leadership, especially those in Big Tech.
The earnings and business prospects of companies, he said, might now play a larger role in market action, Cramer continued. He claimed that this sort of prevailing sentiment creates great investing opportunities.
“It feels like we may be back in the world that I remember, a world where the Fed only plays a role at extreme moments,” he said. “A world where we don’t have to guess and guess and guess their next move, or even listen to what the regional governors are saying, because it won’t be that important in the margins.”
