The true enemy of the stock market isn’t inflation, it’s froth, Jim Cramer warned his Mad Money viewers Monday. That’s because froth only appears at the end of a rally, Cramer explained, and it always involves a lot of pain for shareholders.
The markets are already down big from their November highs, and many speculative investors from last year’s wave of IPOs and SPACs have either taken huge losses or have exited the market altogether. That’s why it’s cringeworthy to see stocks like Tesla (TSLA) - ໄດ້ຮັບລາຍງານ Tesla Inc rocket up 8% on just the rumor of a possible stock split. Gains made on rumors, Cramer explained, will easily evaporate during the next downturn unless there is something solid to back it up.