CNBC personality Jim Cramer shredded investors who bought stocks ahead of a hotter-than-expected September inflation report that immediately fueled a significant selloff.
Stock futures had traded higher earlier Thursday morning on a report that the British government was reconsidering a widely criticized plan to slash taxes. But those gains were lost and the Dow opened several hundred points lower after the newest Consumer Price Index showed stubbornly hot inflation.
“What clowns thought this was gonna be cool? It’s wages, food and housing. We’ve made no progress by any means,” Cramer said. “So those that are buying stocks and don’t realize futures are going to take all of the stocks down are only beyond my ken. I don’t know what they’re doing.”
“And the individuals who bought stocks based on Britain, they’re much more silly than the individuals who bought stocks betting on the CPI being cool. Truthfully, I just don’t know what to say, how people may very well be so fallacious,” Cramer added.
“What clowns thought this was gonna be cool? It’s wages, food, and housing. We have made no progress by any means,” says @jimcramer. “The clowns who bought the futures this morning based on London, they do not even know what a future is!” pic.twitter.com/qMaJqL6Etk
— Squawk Box (@SquawkCNBC) October 13, 2022
Inflation increased by a higher-than-expected 0.4% from August to September and ran at 8.2% in comparison with the identical month one 12 months earlier. Each numbers were larger than expected and indicated the Federal Reserve’s series of sharp rate of interest hikes have yet to have the specified effect on the economy.
Core inflation, which excludes volatile food and energy prices, jumped 6.6% — the best reading of its kind in 4 a long time.
The Dow Jones Industrial Average was down greater than 260 points as of about 10 a.m. ET. The tech-heavy Nasdaq was down greater than 300 points and the broad-based S&P 500 was down roughly 80 points.
Inflation hit 8.2% in September.
Food and rent prices have spiked to four-decade highs.AP
Jim Cramer said investors must be patient before attempting to buy the dip.CNBC
Cramer argued the time to “buy the dip” will eventually arrive – but not until the market sees concrete signs that inflation has moderated.
“Don’t do it yet. Don’t do it until you see some progress in wages or food or housing,” Cramer said. “These are the stuff that all of us see every single day.”
The CNBC personality asserted that misguided “nameless” hedge funds were answerable for the false rally in stock futures ahead of the inflation report.
“These persons are so not making the playoffs,” Cramer quipped. “I’d fire the coaches of each certainly one of these funds who’re buying. But we don’t know who they’re – they’re nameless.”
“It was fallacious to think that this was going to be a cool number,” he added. “It just was fallacious and that’s OK. People make mistakes and so they made loads of mistakes and so they’re going to lose money and so they must have waited and they might’ve gotten higher prices. But no, they’d to leap the gun.”
