Turmoil in bank stocks may feel like a looming "train wreck" for Wall Street, but as long as the debt ceiling crisis is resolved it won't destroy the market, Jim Cramer said Thursday.
"I believe we'll have more mayhem like we saw the last time this happened in 2011, where the real issue is whether the ratings agencies downgrade the U.S. debt, not what's happening in Congress," Cramer said.
While some experts say we shouldn't worry about not getting a deal, Cramer said, he isn't optimistic — and thinks a deal will arrive in the eleventh hour if it's reached at all. By that point, the market will likely already have fallen, he added.
"So why not wait to do some buying? Well, if we clear tomorrow's labor report hurdle, then the market will rally," Cramer said, adding that it'll only be tradeable because of the likely length of debt ceiling negotiations. "If we do rally short-term, I recommend taking some profits and then steeling yourself for the debt ceiling fiasco, and then you can buy more."
The debt ceiling crisis is just one of four major hurdles Cramer sees in the market right now.
But if concerns about the debt ceiling are cleared, that should pave the way for a much more upbeat market, Cramer said. It could potentially reopen the IPO window and usher in good deals, like Thursday's market debut of Johnson & Johnson's consumer-health spinoff, Kenvue. Kenvue's debut was the biggest U.S. IPO since 2021.
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