Why Jim Cramer thinks the stock market isn't loved
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While Warren Buffett said, “our favorite holding period is forever,” occasional investor skittishness is nothing new. Yet has it gone to extremes?
Despite solid stock market performance this year, “I think that we’re in a period where people are not sure about capitalism,” “Mad Money” host Jim Cramer told Yahoo Finance’s Brian Sozzion a new episode of the Opening Bid Unfiltered podcast (see video above; listen below).
“I do believe we’re still stuck with what happened in 2000 and 2008, which were both horrendous,” he continued. “Although if you held on to the Mercks of the world, you ended up doing fine.”
Cramer has sat in the host chair of “Mad Money” for nearly two decades and is the author of several books, including the recently published “How to Make Money in Any Market.” He has studied markets and worked to demystify them for the average investor. He was one of the first to call out Nvidia (NVDA) — “my best pick” — when it was just a gaming company. He also had a hand in coining the acronym FAANG (Facebook, now Meta (META), Apple (AAPL), Amazon (AMZN), Netflix (NFLX), and Google (GOOG), now Alphabet (GOOGL).
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“FAANG was the greatest creator of wealth in my life other than Nvidia, and I think my job was to find great stocks,” Cramer said. “But I wanted people to understand why I thought they were great.”
For many young investors, crypto and the hot stocks of the moment often crowd out the more traditional names and advice, leaving them susceptible to more volatile investments. “Compounding is so boring,” Cramer said. “People think it’s too hard. They don’t understand what the P/E means. They don’t understand what it means to buy and hold a great stock.”
This shorter-term thinking contrasts with Buffett’s sentiment on the stock market. He once said, “If you aren’t willing to own a stock for 10 years, don’t even think about owning it for 10 minutes.”
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Year to date, markets remain stable. The S&P 500 (^GSPC) is up nearly 15% while the Russell 2000 (^RUT) is up 11.61%, and the Dow Jones Industrial Average (^DJI) is up 9.76%. Top S&P 500 performers during this same time period include Robinhood (HOOD), Seagate Technology (STX), Western Digital (WDC), Newmont (NEM), and Palantir (PLTR).
Impatience and skittishness are only two obstacles, according to Cramer. “The market got a bad rap because it seemed to be the playground of billionaires,” he said. “It got to be the image of the filthy rich, and the billionaires don’t help.”
“I don’t want it to be a playground at all,” he added. “I want it to be the school for people to get rich as they did when they bought Nvidia.”
Grace Williams is a writer for Yahoo Finance.
Each week, Yahoo Finance Executive EditorBrian Sozzi fields insight-filled conversations and chats with the biggest names in business and markets on Opening Bid Unfiltered. You can find more episodes on our video hub or watch on your preferred streaming service.
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