Does all the negative sentiment in the market have you itching to hit the sell button? Resist.
Then ask yourself, why isn't the S&P 500 or the Dow getting crushed? That is, why isn't the market being laid to waste by the big issues in Washington?
"I often find that when a market doesn't do what you expect it's because there's some countervailing factors," explained Jim Cramer on Tuesday's broadcast.
In fact the Mad Money host sees 4 reasons that instead of dropping sharply – the market could rally hard.
1. The market is hopeful that a deal can be reached to avoid the 'fiscal cliff'.
hat optimism isn't blind faith or hoping for the best. Business leaders have banded together to prevent crusty lawmakers from using the fiscal cliff to play politics. With so much at stake, CEOs from all sectors are now pressuring the government to reach an agreement through organized groups such as "Fix the Debt." Read More: "Fiscal Cliff: America's Looming Economic Crisis"
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2. Selling is something that doesn't come all that easy to people unless there is panic in the air.
So far, the worries about the cliff have eluded many people. "Chalk this part of the lack of a big decline on blessed ignorance. These people just don't know what awaits them," said Cramer.
3. There are a large number of buyers in the market right now.
For investors who follow fundamentals, some companies are so good and the dividends of others are so high that buyers simply can't resist.
As a result, "People who are buying stocks for their IRA or 401k and the mutual funds that are the repositories of that money are natural buyers of these stocks on any sell-off," said Cramer.
4. Markets will likely soar the moment the fiscal cliff is averted.
"The prospects of being out of the market on the day when we get a resolution, any resolution, even a subpar one, are very real. You miss that moment, you might miss all the gains we are going to get for the rest of the year," said Cramer.
What's the bottom line?
The market isn't getting crushed and probably won't get crushed because there are plenty of reasons to stay put.
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