Markets reacted negatively to missed expectations in Japanese economic data, but CNBC's Jim Cramer said that investors are too focused on events in the country and should be concentrating on other areas that are more economically important and showing positive signs.
"This overpropensity to look at Japan is nuts," Cramer said on "Squawk on the Street" on Monday. "Listen, China is far more important and Europe is far more important in the sense of all of that data we've been getting."
"Those who are trading off Japan: That has been a frequent and mistaken trade," he said. "It tends not to last past 11 or 11:30 in the morning."
Cramer explained that the global economy is driven by the United States, Europe and China, and developments in Japan shouldn't be overemphasized. The country's radical monetary policy—which is routinely referred to as "Abenomics"—is simply an experiment, Cramer said.
He added that Japanese companies outside of the auto industry have "given up" after finding it difficult to create value.
"I don't want to overemphasize Japan because you're liable to miss the big picture," he said, which includes better numbers from Europe and China.
"I just think that we should stay focused on Europe … Japan is just an experiment," Cramer added. "The industrials continue to power higher, including industrials that don't even have good numbers. That is because there is an expectation of a return to Europe, not because of Japan."