CNBC’s Jim Cramer on Monday reflected on recent market action, and argued that the reason the S&P 500 plummeted into correction territory last week deviated from typical explanations.
“Right now, people are worried about a recession that’s caused by the President of the United States,” he said. “It’s a correction that has nothing to do with the federal government’s transition to a more prudent spending philosophy.”
According to Cramer, corrections can occur for a variety of reasons — a change of stance from the Federal Reserve, a market that became “too exuberant,” or issues from abroad. But that’s not what’s happening now, he said. Instead, the steep sell off has to do with “a lack of consistency and a lack of certainty” coming from the White House.
Cramer said he largely agrees with President Donald Trump‘s expressed goal to improve trade agreements with other countries, but he believes that the president’s erratic policy messaging has terrified Wall Street and the broader economy. Cramer suggested that the market was able to advance on Monday — the Dow Jones Industrial Average rose 0.85%, the S&P 500 added 0.64% and the Nasdaq Composite gained 0.31% — because Trump didn’t make any inflammatory posts.
Cramer also pushed back against Treasury Secretary Scott Bessent’s claims that corrections are “healthy” and “normal.” Bessent, he said, is insinuating that all corrections are the same, when that’s not the case. The market will “have a hard time staying positive” without some certainty from the White House, Cramer added.
“The mercurial postings, the scattershot approach to trade policy, is the proximate cause of the correction, and I ask you Mr. Secretary, with 35 years of experience, is that normal? Is that healthy?” Cramer asked. “I don’t think so.”
The White House and the Treasury Department did not immediately respond to a request for comment.
