As soon as oil rebounded on Tuesday, stocks managed rally out of the deep hole they were in earlier in the trading day. And while Jim Cramer has been adamant about lower oil prices being good for the stock market, there is one giant dark underbelly that he thinks needs to be addressed.
"The longer crude keeps collapsing, the more stress there really is in the system, and the worse the fundamentals get for the financials that lent these oil companies money. That is why we are so glued to every tick up or down in the price of oil," the "Mad Money" host said.
Initially when oil began to sell off, there was a host of small companies that went belly up.
That is no longer the case.
Investors now worry about companies that used to be a lot larger, like Chesapeake Energy, which was right in the blast zone of the recent sell-off. Additionally, Cramer does not think the market is ready for these large companies to default. Much of the debt is held in high-yield bond funds.
"If you haven't heard me before I am telling you that these must be sold. I mean MUST. This is no place to be reaching for yield," Cramer said. (Tweet This)