CNBC’s Jim Cramer said Thursday there is more pain in the U.S. economy than what is reflected in the stock market’s robust recovery from coronavirus-era lows.
“I’m thinking, wait a second, don’t get too optimistic. I think it’s our nature to be optimistic,” Cramer said on “Squawk on the Street.” “We like the fact that the market is going higher because our viewers own stocks. But right now we seem gassed.”
Cramer’s comments follow initial jobless claims for last week checking in at 1.106 million, higher than economists had expected. It marked an increase from the prior week’s total of 971,000, which was the first time in 21 weeks that initial claims were under 1 million.
“Are these numbers worrisome? Well yes, if you don’t get a stimulus package — and yes, if you don’t get a vaccine,” Cramer said on “Squawk Box.” “I think be prepared for more of these numbers.”
The stock market has experienced a sharp rebound from its pandemic-induced sell-off, with the S&P 500 on Wednesday notching another intraday high. And some corporate giants, such as Target, have reported strong quarterly earnings.
But neither paint an accurate picture of what is happening in the economy, particularly with small businesses, said Cramer, owner of a Brooklyn restaurant.
“I think this is the two economies. The ‘V-shaped’ recovery in stocks is not the ‘V-shaped’ recovery in the economy,” the “Mad Money” host said. “You may be joyous about Target, and terrific numbers that we got from Lowe’s. But this is the real world; real world not so hot.”
Cramer suggested there has not been a large enough reckoning with how persistent the coronavirus remains — and the economic consequences associated with the health crisis. “We are right now beginning to realize that the pandemic has recessionary impact that we hadn’t thought.”
He’s implored Washington lawmakers and White House officials, who remain gridlocked on another round of relief legislation, to provide adequate support.
“That’s why I’ve said over and over again to both sides, ‘Look you’ve got to make this so it’s open ended,'” he said. “You’ve got to make it so we have something that gets us to the vaccine. No one wants to relate directly why we have this problem. It’s not because of a slowdown. It’s because of Covid-19.”
“I absolutely understand the budget deficit and you can talk about the budget deficit forever,” Cramer added. “I’m talking the Republic, the society, because there’s so many people, 15 million in the restaurant business alone, these people cannot have jobs but they’re not going to go become carpenters.”
