On Tuesday, CNBC’s Jim Kramer told investors that they should not rely on optimism as a market strategy, but should be prepared to act when the market recovers.
“I think you can do very well right now in a balanced portfolio with lots of cash on hand. You want to be prepared for the moment when things actually get better. Be a little more careful than we might like in some important sectors.
The latest U.S. inflation data shows that consumer prices rose 8.5% in March from a year earlier, their highest level since 1981. Stocks fell in response on Tuesday, with the Dow Jones Industrial Average falling 0.26%, while the S&P 500 fell 0.34%. Nasdaq Composite is down 0.30%.
Kramer said he doesn’t think investors should lose all hope of regaining the market, but he is wary of spreading “false positives.” He cited Russia’s invasion of Ukraine, coveted shutdown in China and shortage of semiconductor chips as the main culprits of poor market performance.
“When there are fewer problems, you’re moving away from the realm of hope to the realm of reasonable possibilities. I like to bet on reasonable possibilities. That’s why we’ve prepared so much cash for charitable trusts that we can jump in when we start seeing them,” Kramer said. Said.
“But for now, what we’ve got is hope, and that’s not enough for a game plan,” he added.