Cramer: The real fools bringing down oil

Tomfoolery—that is what this market has been reduced to. Jim Cramer just doesn't understand why things have become more complicated than they need to be.

Most of the companies in the S&P 500 actually benefit from lower oil prices. So how the heck are there 317 million Americans fooled into thinking that lower oil is bad news, leading to the S&P to close down on Tuesday? He thinks the market is acting foolish, and suspects that it is the hedge funds causing the problem.

From a consumer standpoint, if you fill up your gas tank twice a week and it used to cost $80 each visit when oil was above $100, it now costs $60. That's $40 a week pocketed, which amounts to $2,000 a year.

Cramer bets that if the government gave out checks for $2,000 to everyone, the market would soar.

The reality is that oil stocks have been huge leaders of the bull market. While they only make up 10 percent of the S&P 500, they have been big winners in the past and stick out like a bright light. When that light dims, it brings down the market with it as well.

Traders on the floor of the New York Stock Exchange.
Getty Images
Traders on the floor of the New York Stock Exchange.

Lower oil prices benefit many sectors. Airlines and transports are the biggest beneficiaries. Cramer expects them to hit all-time highs, causing his favorite stocks like Spirit and American Airlines to report a big quarter.

Bonds will also benefit, because low oil is deflationary. This will push up the value of bonds and create low yields. In return, utility stocks will go up immensely.

And how about the consumer packaged goods plays? The biggest expense for these companies is with the energy used to package and get the stuff on the shelves. It's no wonder that Clorox, Procter & Gamble and Kimberly Clark have all been soaring.

There is more to go as well. Further beneficiaries include industrials, healthcare, technology, banks, and eventually retailers. The list can go on and on.

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"I've simply come to the conclusion that it's just too darned hard for most of the hedge fund managers with their fancy algorithms who trade every minute to understand. No wonder they keep missing the big picture," Cramer said.

So, don't let those foolish hedge funds persuade you otherwise. Go out and celebrate that money saved at the pump, and appreciate low oil for what it is—money in your pocket.

Call Cramer: 1-800-743-CNBC

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