Ever since the top of the market formed with Alibaba going public, it seems everything that could go wrong has. The rally on Monday was short-lived, as the S&P 500 closed down at least 1 percent in three consecutive sessions. The Dow Jones industrial average fell 223 points, or 1.35 percent and the S&P 500 fell 31 points, or 1.65 percent.
"Mad Money" host Jim Cramer reiterates this is a treacherous market—as the market couldn't hold even after the Fed indicated there is no hurry to raise rates; there was a good China export number for September; and there were peace rumblings in Ukraine. So rather than join the panic, Cramer gives his fans 10 steps of how to stem the market.
No. 1 Containment of Ebola
The fear has become so strong that some are expecting a SARS-like cut back in travel, and that was an airborne contracted pandemic. Ebola is bringing a sense of panic, especially when the lead story in the Wall Street Journal is "Ebola Case Puts Focus on Safeguards." Likewise, American Airline's stock peaked in June at $44, and has been going down since then and is now at $28. Cramer thinks it's reasonable to presume this gain for American Airlines could disappear because there has been so many conflicting reports. If there is another Ebola victim, he says we could be down even worse from these levels.
No. 2 Level the playing field
Cramer thinks it's time all stocks get hammered, not just industrials and oils. There are some safe stocks out there that are very close to their 52-week highs. There's no place to hide in a genuine selloff though.
No. 3 Wrench speculation from the market
Speculation needs to be wrenched out of the market, and the "Mad Money" host thinks that is happening right now. The cult stocks like Tesla, Netflix, Mobileye and GoPro are getting hammered as well. That is essential for a bottom.
No. 4 Oil to find its footing
Normally it would be terrific if oil were going lower, but in the environment of Ebola constraining travel; oil has to find its footing. Cramer fears the chaos created by hedge funds and believes the bounce in oil futures on Monday are not long-lasting.