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Cramer: Why 9.4% Unemployment Is Good

Some investors may wonder how the highest unemployment rate since 1983 is a positive. Yet that is exactly how Friday played out, as monthly jobless numbers reached 9.4% and the market edged higher. Cramer’s theory: The layoffs are largely over, Wall Street knows it, and stocks were bought and sold accordingly.

Huh?

Consider this: The Lehman Brothers collapse was an eye-opener for everyone, not just the financial sector. When that comet hit, CEOs across the entire economic spectrum adopted a bunker mentality and started to make massive cuts in preparation for a worst-case scenario. The first and most obvious target was the workforce, and companies slashed jobs big and deep.

Thanks to responsive governments the world over, though, a second round of layoffs wasn’t needed. Stimulus programs spared us that trouble, and President Obama’s decision to save General Motors and Chrysler – and as a result, their suppliers – was a big help, too. This prevented the U.S. unemployment rate from reaching Great Depression levels, which were 33%, and instead kept us under 10%. All this despite the near collapse of the entire financial sector, a bursting housing bubble, retail’s decline and those problems in Detroit.

Not bad, right? At least that’s how the market saw it. And that’s why stocks finished the day in positive territory. Cramer wasn’t making light of the 343,000 Americans who lost their jobs in May. But overall there are now fewer people in danger of foreclosure, though more are able to spend money and pay taxes.

“Believe it or not,” he said, “that’s bullish.”

Buy B.O.A.T. – Banks, Oil, Aerospace and Tech – if you think the economy will come roaring back. JPMorgan Chase , ConocoPhillips , Boeing and Apple work for believers in this thesis.

Worried about inflation? If so, you must think the economy is actually too strong. But still, Cramer recommended Agnico-Eagle Mines, SDPR Gold Shares or gold bullion for those in this camp.

Lastly, Johnson & Johnson, Colgate-Palmolive and Hershey are the stocks to buy for anyone feeling a bit more cautious. These are classic defensive names for anyone who is not as bullish on the economy.

Consider this a portfolio for the market as it is right now. Throw in a small cash position, too. No one really knows which way we’ll go, Cramer said. So we need to be ready when we find out.

Cramer's charitable trust owns ConocoPhillips and JPMorgan Chase.

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com

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