CNBC’s Jim Cramer on Monday told investors he sees an economy on the horizon that can foster growth without endemic inflation. According to Cramer, this would be an ideal situation for the stock market.
Cramer first cited July’s jobs report, which was released last Friday by the U.S. Department of Labor. The report showed 187,000 jobs added last month — slightly below the Dow Jones estimate of 200,000 jobs — along with an unemployment rate of 3.5%. Cramer said these figures suggest modest job growth with less inflation, and that can point to an opportune time to invest.
“I can go into so many other positives for stocks,” Cramer said. “I just think the overarching issue here is that we’re getting exactly what Wall Street always wanted: growth with declining inflation, and that happened after a terrible week last week.”
He added that when rate cuts eventually start — which he said he believes will be sometime next year — the yield curve will go from inverted to normal. Many of those who sold stocks because of bond yields “will suddenly be eager to buy stocks hand over fist,” he said.
Cramer also listed several other factors that suggest a positive economic landscape in the U.S., including the country’s accelerating manufacturing growth after years of declines. This earnings season has also been positive, Cramer said, with many companies reporting positive revenue and earnings.
Cramer’s bottom line: good earnings, good economy and good setup, he said.
“Time to understand that when the market comes down like it did on Friday — not today, because it went and moved up big on Friday — we have to recognize that the economy is better than anyone imagined a few months ago,” he said. “So, look for things to buy on weakness and then pull the darn trigger.”
This story originally appeared on CNBC
