Don't panic over rampant inflation, Jim Cramer told his Mad Money viewers Wednesday. The seeds of deflation have already been planted, Cramer said, and they will be self-evident soon enough.
While it's true that the consumer price index was the highest we've seen since 1991, the market's rebound by the close shows that something good is bubbling under the surface. Indeed, the bond market also responded positively to Wednesday's news, with prices rising, sending yields slightly lower.
On Action Alerts PLUS, Bob Lang and Chris Versace discuss Katy Huberty's Apple (AAPL) note, Bristol-Myers Squibb (BMY) , their trims of United Parcel Service (UPS) and Wells Fargo (WFC) , and Lang gives some reading recommendations on technical analysis. Read more of their investing insights and trading strategies on Action Alerts PLUS.
Cramer reminded viewers of Tuesday night's segment with Carley Garner, which outlined how crude oil was likely to peak this week before heading into a steep seasonal decline. Corn prices also dipped Wednesday on news of a bumper crop. And most importantly, Cramer's go-to metric, container board prices, are also signaling that packaging prices are headed lower going into 2022.
Cramer added that many of our inflationary pressures will self-correct. Wednesday, the White House took steps to help free up our overloaded ports, mandating they run 24 hours a day until the backlogs are cleared. As for the shortage of truck drivers, Cramer said CEOs will learn soon enough that if they want to survive, they need to pay their drivers more, and perhaps a lot more, to increase the size of their workforce.
All of these positives aren't visible in the stock market quite yet, Cramer concluded, but if investors are patient, they'll soon start to bear fruit and curb our inflation fears.
Labor Shortages and Your Portfolio
The labor shortage is here to stay, but that doesn't mean it has to affect your portfolio, Cramer told viewers. Over 4.3 million workers quit their jobs in August alone, but that has created clear winners and clear losers.
If your job is physically demanding, then there's a pretty good chance you're losing workers at an unprecedented rate. Some of the hardest hit sectors include hospitality, retail and healthcare, but they're not alone. FedEx (FDX) , J.B. Hunt (JBHT) and Deere & Co. (DE) all pointed out labor shortages on their conference calls.
But on the bright side are companies like Paychex (PAYX) , which helps businesses recruit and retain workers. There are also small business enablers like Intuit (INTU) and Cintas (CTAS) . And there are technology companies like UiPath (PATH) , which helps automate manual processes.
Other winners include companies that have established recruiting practices and excellent benefits, companies like Costco (COST) , Starbucks (SBUX) , Chipotle Mexican Grill (CMG) and Williams-Sonoma (WSM) . You don't have to recruit new workers if you never lose the ones you have, Cramer noted. Any of these labor shortage winners would make an excellent addition to your portfolio.
Fintechs: What's Hot, What's Not
With the traditional bank stocks coming in hot this earnings season, Cramer told viewers it might be time to look at money managers' favorite bank alternatives, the fintech stocks.
When you say the word fintech, two stocks come to mind, and Cramer was bullish on both of them. He said that PayPal (PYPL) has been a long-term winner, with shares up 550% over the past five years. The company is expanding into debit and credit accounts as well as buy-now, pay-later services and even high-interest savings accounts. Square (SQ) has also been a big winner, with shares up 31% over the past year alone. Square began as a small business payments service that has also expanded and now offers small business loans, peer-to-peer payments and more.
Beyond the big two however, Cramer was also bullish on some newcomers, including Upstart (UPST) , the automated lending platform that aims to make FICO scores obsolete, Affirm Holdings (AFRM) , the king of buy-now, pay-later services, and even SoFi (SOFI) , the personal lending service that also offers cash and credit services and even insurance.
The only outlier in the group was Robinhood (HOOD) , the commission-free trading platform that is still picking fights with the Securities and Exchange Commission. Cramer said Robinhood has a long way to go to realize its dream of a one-stop shop for personal finance, and the stock has lockup expirations looming that could cause more selling in the short term. When it comes to Robinhood, he said, take a pass.
Executive Decision: Okta
For his "Executive Decision" segment, Cramer spoke with Todd McKinnon, chairman and CEO of Okta (OKTA) , and Eugenio Pace, CEO of Auth0, the identity management service that is now a part of the Okta family.
McKinnon explained that there is no standard when it comes to identity services and Okta helps companies connect and integrate over 7,000 different applications into a single, secure solution. Pace added that Auth0 brings a developer focus to the Okta platform, giving developers all of the tools they need to build better, more secure applications.
Security is a difficult job, Pace admitted, but with Okta, companies don't have to worry about identity, they can focus on their business instead.
When asked how they help customers, McKinnon said that Okta lets companies like Moody's build better digital experiences for both their employees and their customers, keeping both sets of users secure while still building easy-to-use applications.
Own, Don't Trade, Apple
In his "No Huddle Offense" segment, Cramer opined on Apple, a company he's long told viewers to just "own it, don't trade it."
The Apple bears are out in force again, worried that Apple's supply chain might not allow it to make enough iPhones. But Cramer said he's seen this story before. Eleven years ago, investors fretted over "Antennagate" on the iPhone 4. Years later it was a slowdown in China, followed by "lackluster" new models. Then in 2018, Apple stopped reporting iPhone unit sales and the bears declared Apple's best days were clearly behind them.
But then there's the chart of Apple's stock price, which continues to rise year after year after year. Cramer said you'd be hard pressed to find Antennagate on Apple's chart, or any of these other doomsday events. The fact is that trading in and out of Apple simply doesn't make any sense. The best investing advice Cramer can give is, "own it, don't trade it."
Here's what Cramer had to say about some of the stocks that callers offered up during the "Mad Money Lightning Round" Wednesday evening:
To sign up for TheStreet's free Daily Booyah! newsletter with all of the latest articles and videos please click here.