Cramer: Don’t Fret Over Debt Ceiling
"I feel like I'm surrounded by people who are already fretting about the next big bad thing, this time it's the expected fight over how to address the debt ceiling," said Cramer.
The Mad Money host, however, refuses to get bogged down in Washington's petty squabbling.
1. Typically sharp sell-offs are generated by unexpected catalysts.
"I know there are plenty of other people who can and will worry about the debt ceiling, so I don't have to do it," he said. In other words, Cramer thinks it's far more prudent to worry about the things that very few people are worried about – that's what typically sends the market into a tailspin. "When everyone is fretting over a problem in advance, that problem has a tendency to be resolved."
2. The worst is probably behind us.
"I was far more concerned about where individual tax rates would end up than I am about the coming battle over spending," he said. "And I suspect the President might invoke the 14th amendment to ignore the debt ceiling limit and argue that the Federal government's bills must be paid. There's a strong constitutional argument in favor of this stance, even as I want to see spending reined in very badly."
3. Politicians won't gamble with their careers.
Perhaps this takeaway is most important. Ultimately the fiscal cliff issue was resolved, albeit at the 11th hour, but it was resolved.
However all the anxiety generated by watching each and every development in DC distracted investors from a slew of other market influences, many of which had wide ranging impact.
And Cramer doesn't want that to happen again. In 2013 he said....
"Don't miss the wave of mergers and acquisitions that I now think can happen now that we've avoided a cliff dive. Don't you wish you owned the rental car companies today as pricing just got better now that Avis bought lowly Zipcar for $500 million?"
"Don't miss the big bank stock rally that dominated the fourth quarter and continued Wednesday, with the worst to first names like Citigroup and Bank of America charging ever higher even as they're so far behind the market that they could go up very big from here without stretching their valuations."
"Don't miss the continuing improvement in housing and the housing related stocks, something that won't be derailed by a rancorous debt ceiling debate and will stay stoked by low interest rates and affordability augmented by a gigantic rebuild in the Northeast."
"Don't miss the steep recovery rally in tech with everything from Apple to Facebook on the move, the former because tax gain selling is over, and the latter because numbers may be too low and at last the promise of Facebook could be realized thanks to the new found embrace of mobile opportunities."
What's the bottom line?
Take heed of the skeptics, but block out the cynics, said Cramer. There's no fire in sight now - just a smokescreen from Washington that will again keep people from realizing the terrific gains this year can produce – that is, if you're blinded by the bickering.
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