This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Cramer: Downed Plane Was a Rubicon

There was another impact that I didn't think about until I read a poll commissioned by that said 36% of people are now afraid to fly internationally since MH17. We have had these scares before, as planes have been bombed or have been hijacked and used as bombs, and they have led to a temporary cessation in flying.

Normally, the airline stocks are so horrible that few bothered with them anyway. That's no longer the case. They have become market leaders. They rallied after MH17, no doubt in conjunction with good earnings reports. Now they are rolling over and I think that's because of fear of flying, however temporary it might be, coupled with a commensurate increase in insurance costs. Cutting numbers on airlines. 

Finally, the stock market got it wrong because of the pundits' endless obsession with the Federal Reserve. There's plenty of money sloshing around that's betting the Fed is behind the curve, so stocks will go down. But stocks go down because of profit peaks and I think the combination of worries about Ukraine and Israel coupled with a potential slowdown in Europe are the real drivers. The dollar's been a rocket ship all month and it only strengthened after MH17. A strong dollar is no friend of American business. Nor has it been a friend of oil, which is plummeting. 

Who is obsessed with the Fed? It's the same cottage industry as always, the Free Marketeers and the people who make a craft of Fed watching.

Sorry, but these ideologues and professional Fed watchers better cast their eyes a little more toward Europe because that's where the profit erosion is and I think MH17 won't be a "bit of a game changer," it's the Rubicon that no one wanted crossed, but certainly looks like it has been. 

Action Alerts PLUS, which Cramer co-manages as a charitable trust, had no positions in stocks mentioned.

Editor's Note: This article was originally published at 6:07 a.m. EDT on Real Money on Aug. 4.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free


Chart of I:DJI
DOW 17,891.16 +117.52 0.66%
S&P 500 2,081.43 +16.13 0.78%
NASDAQ 4,817.5940 +42.2360 0.88%

Our Tweets

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs