(Click for video linked to a searchable transcript of this Mad Money segment)
Both the Dow Jones Industrial Average and the S&P 500 closed lower on Wednesday after comments from the Fed spooked investors.
Specifically, the central bank said it had dropped the unemployment rate as its definitive yardstick for gauging the economy's strength, and instead said it would rely on a wide range of measures when deciding to raise interest rates. The Fed also said it would cut its monthly purchases of U.S. Treasuries and mortgage-backed securities to $55 billion, from $65 billion.
Immediately investors ran for the exits taking developments as a sign that higher rates were galloping toward the market.
It's just that kind of knee-jerk reaction to sell that Jim Cramer thinks could signal opportunity for investors with a long-term outlook.
That's because Cramer believes the Fed is telegraphing recovery. And a stronger economy is exactly the kind of fundamental catalyst that Cramer believes can drive the stock market significantly higher.
"That's right, if you want the stock market to keep going higher, then you no longer want the status quo. And a better economy goes hand in hand with higher rates."
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That's not to say a sudden rate spike won't hurt stocks, it would. Cramer is simply saying that interest rates that creep slowly higher amid a stronger economy is a good thing for investors and therefore a reason to buy, not sell.
Cramer thinks a shrewd investors will put a shopping list together and then hit the buy button over the next few days.
"I'd look at stocks that benefit from slightly higher rates," Cramer said. For example banks do better in an environment of rising rates as do companies closely tied to global growth.
"Wait a day or two, then I'd go pick among the rubble for the beneficiaries of a better economic backdrop. Believe me, if this market's ultimately going to charge much higher from here, then the economy in the U.S. must absolutely get better and that goes hand in hand with higher interest rates," Cramer said.
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