Cramer: Economic challenges too great for stocks?

There are a slew of confusing crosscurrents in the market, right now. And they could lead you to bad decisions.

That is, lower rates, weak results from retailers and plunging commodity costs would suggest a broad advance in the market is without merit. Typically, they're all signs of a slowdown. Therefore, you may be inclined to sell.

Jim Cramer, however, thinks current events and conventional wisdom don't go hand in hand. For example, he thinks ongoing tensions overseas have sent money into bonds, and because the bonds of European nations have become less desirable, more money is flowing into U.S. Treasurys.

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Also, he thinks the decline in commodities has more to do with the strong dollar than a vote of no confidence in the economy. And he thinks retail has become so competitive that weak results reflect poor execution and not an unwillingness to spend.

Of course, it's easy to refute Cramer's theory. The "Mad Money" host's view is hardly time honored. However, there is something else at play in the market, and Cramer thinks it confirms his less conventional outlook.

"Union Pacific hit an all-time high today," he said. "That in itself tells me something. Union Pacific doesn't crack into the all-time high roster for nothing. It's hitting an all-time high because its freight, its car loadings as we call them, are surging," Cramer said.

And, taken one step further, the contents of Union Pacific's freight cars touch many different parts of the economy.

For example, imports and industrial products are a large portion of the business. Also, "Union Pacific is also a gigantic shipper of [fracking] sand," Cramer said, used in the production of energy. Chemicals, agricultural products and autos round out most of the rest of the fright business.

If the stock is at an all-time high, Cramer believes business in all these areas must be relatively strong. That relative strength, in turn, bodes well for the economy.

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"So, what's it all mean? For me it means that the market's move here isn't nearly as problematic as other signals might suggest," Cramer said. That is, the decline in interest rates, the weak results from retailers and the plunge in commodities, in fact, are not signs of economic weakness; rather they're due to other catalysts.

"The strength in Union Pacific says to me that we have good growth with low inflation, and that's the ideal scenario for higher stock prices," Cramer said.

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