CNBC’s Jim Cramer said Thursday that the Fed is closer to winning the battle against inflation than Wall Street believes.
“Price stability is imminent,” he said, adding that the Fed “needs to realize that there really is only one strength left for this whole economy.”
Stocks fell Thursday, reversing an earlier gain as Wall Street worries about a central bank rate hike overshadowed strong corporate earnings.
Cramer said the bifurcation of the economy between a booming services sector and a depressed goods sector has created confusion about whether the Fed has sufficiently contained inflation.
He added that it is mainly wealthy people whose purchasing power has not declined, with the added factor of being able to continue spending on both travel and retail.
” Bed Bath & BeyondThe world probably won’t come back. But luxury goods like Tiffany’s LVMH“But it doesn’t represent the real economy.”
In other words, according to Kramer, the disproportionately high spending of those with higher incomes is likely clouding the true state of inflation.
“perhaps [Fed Chair] Jay Powell, in his fight against inflation, [his] Colleagues want to believe, except for this one area,” he said.
