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now.
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>> Hey I'm Cramer. Welcome to
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Mad Money. Welcome to Cramerica.
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I've been making friends. Geez
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I'm just trying to save a little
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bit of money here. My job is not
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just to entertain educate put in
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context. So call me at one 800
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703 CNBC or tweet me JimCramer.
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Tariffs do matter. They raise
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prices almost immediately. If
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you slap a 25% tariff on all of
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the cars and trucks we import
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from Korea and Japan. You're
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talking about roughly 17% of the
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vehicles sold in the US last
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year. Today President Trump did
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precisely that, which would be a
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25% price increase on about one
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sixth of the US auto market. And
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that's on top of the existing
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tariffs on everything from Japan
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and South Korea. Now that's big
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enough to cause some inflation,
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which is a major reason why the
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average is rolled over today.
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Dow tumbling 432 points, S&P
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falling 0.79% and the Nasdaq
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losing 0.92%. That's a
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significant pullback. But you
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know what. A few months ago I
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would have expected a much
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bigger decline in the stock
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market on this news. Keep in
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mind we have a big persistent
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trade deficit with both Japan
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and South Korea. You tackle a
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big tariff on imports from those
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countries. And suddenly about
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17% of vehicles made there and
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sold here are priced out of the
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market. In other words, this is
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great news for domestic
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automakers. Ford GM should be
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able to clean up both their
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stocks went down today. Sounds
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like not everybody believes that
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wasn't all. That wasn't all
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Trump did at all. He put a 25%
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tariff on imports from
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Kazakhstan, 30% tariff on South
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Africa, 40% tariffs on Laos and
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Myanmar, the country formerly
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known as Burma, which would have
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been easier to pronounce if this
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had happened in March or April.
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The averages would have been
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down a heck of a lot more than
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three than 1%. I'd say three,
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maybe four. So as the market
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just ignoring these numbers. Not
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necessarily. It's possible that
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when we digest these new tariffs
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on top of others that are
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coming, more sellers might
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appear. Even after today's
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pullback. The market remains
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very overbought. We are
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vulnerable if more countries
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refuse to play ball with
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President Trump on trade,
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they're going to get some very
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similar letters from the white
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House. And Wall Street doesn't
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want to see that. But you know
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what? The last time the stock
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market got this overbought, we
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had a similar sell off. Like
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like this. And the next day then
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a week later we were up 3%. So
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if you sold at these overbought
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levels you missed out a big
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move. At this point we've been
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conditioned to buy not sell. And
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weakness which is just by road
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and including tariff induced
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weakness. That's part of the
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psychology. A bigger part
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though, these tariff letters are
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starting to feel a little like a
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visit from Borat. You aren't
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sure whether they hold up under
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close scrutiny, especially the
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one to adapt to Kazakhstan. It's
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like they're picking a tariff
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hat, picking numbers out of a
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tariff hat. What can I say? I
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have mine Kazakhstan. Let's see.
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Oh, geez, we crushed them 80%.
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Wow. Malaysia. What do they get?
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What are they going for? Oh
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32.44% a little more specific
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for Malaysia. Myanmar? Oh, I've
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always wanted to know what the
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what they're going to be for. O,
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my. 45%. That's a lot. Oh my
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God. Well I've got it. I've got
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Oceana. Oceana is getting 40.
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All right. How about Eurasia?
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That's a good 140 9.9. And then
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finally Fredonia, maybe the most
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important country of all,
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39.42%. Fredonia. Not bad. They
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got away with a lot. Now nobody
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knows whether to take them
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seriously, I obviously don't. If
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I talked about two countries in
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1984 and a third for the Marx
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Brothers, we have all sorts of
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due dates. We have all sorts of
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percentages. We have little
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consistency. Japan and Korea
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make a lot of cars here. But
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like with Apple, which has
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pledged to invest $500 billion
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across America, building things
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here does not get you in the
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president's good graces. There
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is no immunity in this tariff
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survivor game, because these
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numbers seem all over the place
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in the white House has
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repeatedly postponed or reduced
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its tariffs. It's really hard to
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tell what's happening and how
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many tariffs will be
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renegotiated, how much will go
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through potentially causing
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inflation and making it harder
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for the Federal Reserve to cut
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interest rates. How much does
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any of this even matter? Big
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picture compared to our trade
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deficit with China, our trade
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deficits with these other
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countries are practically chump
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change. My view is worth 25%
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plus. Again, every one of these
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new tariff proposals could be
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lowered as part of negotiation.
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It's all scattered. Who knows
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what will happen next. We're
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gone. We're done. I think that
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there are a lot of
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misunderstandings about these
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announcements. You have to go
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back to what Trump said when he
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was running for president. This
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is really important because
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people forget. I went over this
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with Peter Navarro, a trade rep
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today. If people are missing
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what he first said back then,
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President Trump said that our
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trading partners took advantage
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of us by buying nothing from us
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and then demanding that we put
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up plants at their country. So
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they want to do business there.
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And that was very bad and very
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understandable for most of
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America. Now he's saying these
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countries don't buy enough from
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our country anyway. Maybe when
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they see these tariffs, they'll
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maybe they'll buy something as a
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gesture of good faith. That
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means you want to buy the stocks
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of American companies that make
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big ticket items that you can't
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get elsewhere. I'm talking about
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Boeing planes, huge turbines
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from GE, machinery from John
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Deere caterpillar, Cummins that
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that's what countries will have
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to do. They'll have to buy that
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stuff to get into President
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Trump's good graces. And that's
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what this is really about. How
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can I talk about buying anything
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in this environment? Because I
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think Trump's ultimate goal with
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these tariffs isn't to force
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companies to build new plants
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here anymore. It's simply to
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sell more stuff overseas. Be
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good. Be good trading partners.
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That's good for profits. It's
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good for stocks. It's bullish.
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How about all the cars that
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Japan and Korea make here. The
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white House seems to believe
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that those foreign automakers
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basically do most of their
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manufacturing overseas. Then
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they assemble the cars here. The
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intellectual property, the big
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engines, that stuff. It's all
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made over there putting the
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bodies here. So again, there's
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no immunity for doing business
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here when it comes to trade,
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because the president thinks
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that almost everyone is a bad
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actor when it comes to
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exploiting our country. And you
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know what? I think most
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Americans agree. Now, aside from
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trade policy, I believe what
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really matters here are the
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provisions of the big bad budget
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bill, even though it will add
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trillions to the national debt.
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Not happy about that. This
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legislation is full of stuff
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that will ignite the economy.
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All sorts of accelerated expense
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write offs that will cause a
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huge a fire hose of
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construction. With all of that
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on the way, it's hard to really
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get worried about these trade
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negotiations. And that's why the
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stock market can't collapse.
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That is strong employment. More
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on that later. So let me tell
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you what we're doing for the
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charitable trust. We no longer
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believe that the tariff numbers
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for the president swung around
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are meaningful. They're just a
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starting point for negotiations
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with countries that really need
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access to our markets. With
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tariffs be inflationary right
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now the market is trading like
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it doesn't matter. It's not
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going to influence Jay Powell as
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much as you might expect because
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it seems very one off. Of
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course, if these numbers are the
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real numbers then yes, it's
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going to be a bit of a problem.
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But nobody believes they're the
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final numbers. So we're making
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some small sales with the trust
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in order to take advantage of
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the profits that others want to
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want to take. I look, I don't
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wanna be glib. I know we're
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staring down the barrel of a
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tariff gun, but if I'm right
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that the president's game plan
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is really to help our
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manufacturers export more
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merchandise, it's hard to make
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the case that we need to do
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really huge amount of selling
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here. Unless you're ringing the
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register on something that's had
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a huge run or something that's a
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dog and didn't move at all. But
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the bottom line, when the only
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stock that's down enough to
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create a real price break is
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Tesla, largely because Elon Musk
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trying to get back into politics
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instead of humanoids, it's tough
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to pull the trigger. Maybe if
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we're patient, we'll get a
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better buying opportunity. That
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was a bad number. 32.4 was bad
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number. So why don't we start
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with Chris in North Carolina?
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Chris.
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>> Hey, Jim. How are you doing?
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>> I'm doing well. Chris, how
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are you doing?
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>> Very well. Hey, I know Nvidia
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dominates all the talking
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points, but I'm heavy on micron.
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Last three years has been up
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50%. I'm also in Nvidia. Last
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two years has been up 100%. But
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I'm wondering with micron making
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both Nand and Dram memory chips,
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aren't they in a better position
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to dominate AI over the next 5
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or 10 years?
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>> I can't tell you how glad I
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am that you brought up micron.
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Micron stock ran up huge into
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the print, so to speak, and then
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when the print came out, it was
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excellent. Since then the stock
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has been going down. We've seen
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this pattern before, by the way.
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You know we saw the same pattern
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in TJX. It's rather remarkable.
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It took far longer to settle
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down than I thought. Micron you
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buy some tomorrow and then you
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buy some. Then you wait a 10%
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interval. I'm not getting 10%
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because I don't know where the
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bottom of this thing is. But you
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can start tomorrow because it's
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down that much from the high
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right. And today's sea of red,
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it don't see a lot of areas
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where we've proven to sell, but
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we still have to be patient for
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some buying opportunities. We
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need some cash. I mean the
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market is very overbought and
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some wow. That's a very specific
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number 32.44 I wonder who that
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belongs to on Mad Money tonight
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core we've announced its
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acquisition of Core Scientific
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and a $9 billion all stock deal.
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And I'm hearing more about the
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vision the combined companies
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with core. We've co-founder and
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CEO Mike Intrator. Then the
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Labor Department's nonfarm
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payrolls can tell you a lot
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about the state of this market.
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I'm going off the charts with
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the legendary Larry Williams to
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read the labor market tea
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leaves, and you did stump me
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with this Laniado doctors. I did
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the homework over the long
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weekend and I'm ready to share
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my thesis. So stay. So 45% are
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going to stay with Cramer.
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>> Don't miss a second of Mad
00:10:05
Money Follow JimCramer on X.
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Have a question tweet Cramer
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