Jim Cramer says the economy is headed for a soft landing
TBEN’s Jim Cramer told investors Monday that he thinks the Federal Reserve will steer the economy toward a soft landing.
“The only result is a soft landing for the economy, which means it’s foolish to sell now, as you end up just buying back those same shares at higher levels to beat the turn in 2024,” he said.
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Stocks fell Monday as investors became cautious about rising bond yields. Government bond yields increased, with the 10-year yield rising nearly 11 basis points to 3.64% and the 2-year yield rising approximately 18 basis points to 4.48%. Revenues and prices move inversely.
Cramer, who has said the market is in bull mode in recent weeks, doubled his stance despite the worrying movements in bond yields.
“I would go so far as to say that the bond market is wrong… long-term bond yields are lower than short-term bonds.[-term] signaling a recession, and I think that’s just wrong,” he said.
Cramer added that a big reason he doesn’t expect a hard landing is January’s stronger-than-expected jobs report. Nonfarm payrolls rose 517,000 last month, far surpassing the Dow Jones estimate of 187,000 and December’s gain of 260,000.
“That number unequivocally supports the idea of a soft landing. You just can’t have a hard landing when you see so many jobs being created,” he said.