With the Dow down 165 points, Cramer acknowledged things looked bad Tuesday, but said the true story of what's happening is less negative than what's depicted in the press.
Ultimately, the sell-off wasn't about China raising rates, causing oil and machinery stocks to be mutilated. It wasn't about disappointing earnings either. Cramer thinks it was a "garden variety pullback," where people were taking profits after a monumental run. But you won't hear that from the bears who spout their negative views in the media. That's why if you want to survive as an investor, especially coming off a nasty session, you need a healthy dose of optimism to counter the relentlessly negative media bears.
It's important to take a glass half-full view, so you can see how the people who get to define the news haven't done their homework. China raised rates, not the US. While China is important, are they more important than the US? Their rate increase moved the US dollar up and sent some key commodities down, including copper and oil. At least it helped ease fears of commodity inflation. Plus, China needs to slowdown to avoid a bubble. Their doing what's needed to have healthy growth and that's good news, not bad.
From the headlines, you'd think the recent earnings reports were just awful. The media reported that Apple had disappointing guidance that showed things are getting worse, not better. But the truth is that it simply gave its traditional conservative guidance. Sales of Apple products have been great and the fact is the company can't keep up with orders, especially in China.
Based off press accounts, one would think Goldman Sachs isn't living up to its old self. But revenues were actually up for the investment firm. It had terrific investment banking and mergers and acquisitions, which helped offset the equity and fixed income businesses. They earned $2.98 versus $2.29 and revenues were up. The stock climbed to $3 Tuesday and probably would have gone higher on a good day.
Bank of America reported a gigantic $8 billion loss and everything seems pretty grim there. But their operating results were much better and that means loan losses are improving.
Cramer could perform this kind of "headlines bad, substance good" analysis for a half dozen more companies. So what's going here? Cramer said people aren't listening to conference calls. The truth will come out eventually, but finding it is too time consuming, so the panicked headlines win out every time.
Nobody ever got hurt taking a profit, so Cramer can't fault people for using the headlines to take some off the table. But he hopes people realize that there is more to the story than the headline itself.
When this post was published, Cramer's charitable trust owned Apple.
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