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Cramer: Scars from the Great Recession impacting stocks

Cramer: We have scars of the Great Recession
Cramer: We have scars of the Great Recession

There is one unifying principle that Jim Cramer can seem among all of the earnings reported this year, especially with retail and restaurants — people want value.

"Eight years out of the worst downturn since the Great Depression, you would think people want to spend more money again. Splurge even," the "Mad Money" host said.

Instead, just like the Great Depression, the Great Recession has left scars on investors, and it is defining what stocks work right now in the market.

Cramer saw the same scars in the way his father spent money growing up. They were only allowed to go out to dinner twice a year, and when they did they had to order water to drink.

Investors are in a similar position right now, and it is impacting stocks.

There is a new generation of Cramers out there and they aren't spending as often as they used to.
Jim Cramer
New York Stock Exchange
Bryan Thomas | Getty Images

There is evidence of spenders coveting value in furnishings. Restoration Hardware's stock was down 27 percent on Thursday after the company confirmed that the quarter was much weaker than expected.

Restoration Hardware makes expensive furniture and often caters to wealthy individuals, which could have been impacted by the decline in oil and strong dollar. Suddenly, with currencies and economies shifting, they may not be that wealthy anymore.

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Meanwhile, companies like TJX were able to beat Street estimates from strong holiday sales because of the bargains.

"Let's stick with TJX. The bargains they give you in clothes are directly related to the inability of the broadline retailers to sell branded goods from VF Corp or Ralph Lauren or Hanesbrands," Cramer said.

In the food space, Cramer heard from two companies — Popeyes Louisiana Kitchen and Jack in the Box — that said value offerings from competition as a reason for shortfalls.

And even though Cramer knows it sounds counterintuitive, the winner is the one that offers the most value. It is impacting the stores where we shop and the restaurants where we eat.

"There is a new generation of Cramers out there, and they aren't spending as often as they used to. And when they do, they eschew frills, they want value or they aren't buying at all," Cramer said.

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