Thursday’s market shows we are back on crisis watch in Europe, and that the recession watch in the US continues, Cramer said. But there was a bright spot amid the gloom with the news of Warren Buffett’s “big save” of Bank of America.
While the “Mad Money” host has been worrying about European bank failures and European country failures, he has also been concerned about BAC . He feared an attack against both the stock and the big concentrated owners of the stock, notably large funds that own a lot of shares and might be subject to massive redemptions.
“Given that the bears have so much invested in crushing this particular bank and profiting from it,” he said, “you had to believe they were close to cracking the safe here.”
But not anymore thanks to Buffett's Berkshire Hathawayinvesting$5 billion in the bank. While some may complain that Bank of America gave away the store and that all the problems remain, Cramer thinks it’s better than the alternative.
“Which do you prefer, the government taking a stake and wiping out everybody or pretty much everybody …,” he asked, “or Buffett taking a stake and taking everyone along for the ride?”
No one was outright saying that the “cataclysmic scenario” for BAC was going to happen, but Cramer said the notion of “short-selling arson coupled with ratings downgrades” was certainly being speculated on.
Now the doomsday Bank of America scenario is very far removed from the table, Cramer said. “And, you know what? The stock might actually be a buy.”
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When this story was published, Cramer's charitable trust owned Bank of America.
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