How do you make money in this market? Believe in Ben Bernanke, Cramer said during Wednesday’s “Stop Trading.”
As much as the shorts may want to drag down stocks, and even while media report after media report focuses on the supposedly terrible things that await investors, Federal Reserve Chairman Bernanke continues to deliver. So, too, do his counterparts at the International Monetary Fund and the European Central Bank.
“How do you catch a 2-percent rally? How do you catch 50 points in the Nasdaq?” Cramer asked, referring to Wednesday’s big market moves. “By being a little more optimistic and having a little more conviction that these policymakers like Bernanke can get it right.”
“Has Bernanke let us down?” Cramer asked. “He’s been right for 4,500 points.”
Cramer defended the $3.3 trillion the American central bank spent on emergency loans to banks and other countries during the financial crisis between 2007 and 2009, saying Bernanke wasn't about to let these groups fail. He also pointed out that Bernanke’s policies were supposed to crush the dollar during November, but the greenback actually gained in value that month.
The shorts simply lack the firepower necessary to outdo the Fed, and the IMF and ECB. The policymakers will always win that fight. Investors should keep this in mind as they manage their portfolios going forward.
“I’m a believer in Bernanke,” Cramer said, “a believer in the IMF. I’m a believer in [ECB President] Trichet. That’s what the market’s saying—they’re going to win.”
Speaking to specific stocks, Cramer said the semiconductors are doing well in the face of some pretty negative attitudes toward the sector. Witness the moves in Altera , Texas Instruments and NVIDIA as proof. He recommended looking for cheap stocks to buy in this group.
He also took issue with the lagging share prices of the transports, such as FedEx and UPS , given how “unambiguous” it is that the American economy is getting better. The fact that these stocks aren’t higher, he said, is a “lie.”
Cramer said he didn’t want to sound Pollyanna, but “the Pollyanna view has made you more money than the bear view.”
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