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Home / Business / The US economy may be "on the verge of a significant decline"

The US economy may be "on the verge of a significant decline"



CNBC's Jim Cramer said on Tuesday that investors should balance the exposure to the market by saving money on the sidelines because there are "some real concerns here."

"I think we could be on the verge of a significant decline in the US economy if something doesn't change soon," said the "Mad Money" host. "Consumer and business confidence [is] slows down. It just doesn't feel right in this country. "

Based on the action in the major indexes Tuesday – the shares in the morning before the Dow Jones Industrial Average shed nearly 238 points, S & P 500 dropped 0.84% ​​and Nasdaq Composite melted 0 , 39% ̵

1; Cramer said it's hard to live with this market.

"You're cursed if you do, and you're cursed if you don't," he said. "Be patient, don't pay for anything here. Wait for your path. In most sectors, it is still too early to take a turn. "

Energy and tool companies are in limbo because of current and potential future political priorities," said Cramer. "As President Donald Trump continues to be friendly to coal production, roads also leading the odds to the Democratic Party winning White House in 2020, he said.

Trump continues to play down climate change, Cramer said, pointing to a headline in the New York Times on Monday that Trump raised his attitude to climate science. however, the crowded field for democratic presidential candidates hopes to create climate-friendly initiatives.

"What are they doing here? Simple, they do nothing. They are waiting for this to see who wins in 2020, "he said." But if they don't do something, great job-producing [initiatives] will leave the window. "

The ongoing US-China trade war is also dependent Consumer confidence, Cramer said, most companies will not be affected by hundreds of billions of dollars worth of goods filed between the world's largest economies – but tensions have made the investment too risky to invest in, he said.

JP Morgan Chase CEO Jamie Dimon stated earlier in the day that the trade damage "has gone from being a screen to being far more important than that" and that if it gets worse, it may be what changes trust … [and] people's will to Investing. "

" It is very frustrating to buy a stock when you do not know if the earnings estimates go up or down and the president's rates are what drives that turn, "Cramer said.

Cramer also noted that "yields do not protect you anymore … stocks continue to fall for fear of a worldwide tax-related decline." He noted that dividend holdings have not gone higher as they usually do when US government bond yields fall to their current level.

Furthermore, "Parade of IPOs" continues to eat up capital. Unicorns come to the market, like Uber and Lyft, have exhausted the market, Cramer said. Investors are cautious about buying new deals, he said.

"On the one hand, there are many good reasons why you can't live with this market. But on the other hand you can't live without it either," he said. "Avoiding stocks is as risky as owning them here."

"But if we keep going lower, we'll bake in the negatives, and the dangers will be on the bear's side, just as it was on the side of the bears today," Cramer said.

WATCH: Cramer explains the uncertain position of US markets

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