Search Jim Cramer's "Mad Money" trading recommendations using our exclusive "Mad Money" Stock Screener.
NEW YORK ( TheStreet) -- The buyers in this are starting to think Washington has become a big joke, Jim Cramer said on "Mad Money" Wednesday, but he fears that the punchline could be deadly.
Simply put, Cramer said the market, and our economy, simply cannot afford to see a default on our debt come Oct 17. He said investors from around the world buy U.S. bonds for safety, stability and income, and if Congress takes those away, those investors will move their money elsewhere. This is a big deal, Cramer warned, and one investors should be taking seriously.
Yet, today's initial public offerings of Remax (RMAX) and Burlington Stores (BURL), operators of the Burlington Coat Factory chain, were up sharply despite the fact that real estate will be hurt badly by a bond default and apparel has been among the hardest-hit retailers this quarter. Cramer said investors are betting that a deal will come in the knick of time, but aren't factoring in the downside if it doesn't.The buyers of these stocks are either worried they'll miss the rally if they don't get in now or they feel that stocks can withstand a default, but neither could be further from the truth if a deal is not reached and our country defaults on its debts, Cramer said.