What we need now is to slow the spread of the coronavirus, Jim Cramer told his Mad Money viewers Wednesday, after another day of big losses on Wall Street. What we don't need, he said, is more negativity -- which is why he offered a list of five things that could help calm the market's fears.
First, Cramer noted that neither the Federal Reserve nor the president can help us. What we need most is to slow the spread of the disease. That means staying at home, avoiding large public gatherings and waiting for the disease to run its course. Second, Cramer said we need to have faith in our scientists, which will hopefully soon have a treatment or vaccine to help us fight back against Covid-19.
The third positive that can help is warmer weather. We don't yet know how this particular coronavirus handles warmer temperatures, but if it's like seasonal flu, the spread should decrease.
Fourth, Cramer said a major government stimulus could help clam the markets. The status quo isn't working and the president's payroll tax cuts likely won't do the trick either. We need strong swift action to combat a possible recession.
Finally, Cramer said some major positive business news could calm Wall Street. News like the return of Boeing's (BA) - Get Report 737 Max would do the trick, he said. The only problem, there's no signs of that happening.
Cramer said he still fears the markets will retest their December 2018 lows, which is why he's urging investors to take money out of the markets if they will need it over the next one to two years. Otherwise, be ready to play the long game.
Join Jim Cramer's special Action Alerts PLUS members-only call Thursday to prepare your investment strategy during the stock market and economic fallout from the coronavirus and energy sector.
What's Ailing Banks?
Why are the bank stocks so vulnerable to this selloff? Cramer said it's easy to see why the oil stocks are plunging -- they're in the middle of an international price war on crude. A decline in the airlines makes sense given that there will be less travelers in the air. The industrials will see a cutback in orders. And technology is harder to sell without face-to-face meetings.
But what about the banks? The banks aren't on the front lines of the coronavirus. They're not hotels or restaurants or retail, either.
There is one thing that makes the banks vulnerable, Cramer explained. Every one of these troubled industries owes the banks money. With a flattened yield curve and a pickup in risky loans, the banks are at risk, Cramer said, and their stocks are reflecting that. There is no systemic risk, as was saw in 2008, but the banks stocks aren't a place you'll want to park your money.
Are There Safe Stocks to Own?
Which stocks are safe to own in such a volatile environment? Cramer offered his opinions on the final third of the stocks in the Dow Jones Industrial Average.
Cramer was bullish on Pfizer (PFE) - Get Report, one of only a handful of names in the Dow that can actually be bought with confidence. He said that Procter & Gamble (PG) - Get Report remains in no-man's land and can't be bought, and the same applies for Travelers (TRV) - Get Report. United Technologies (UTX) - Get Report was a Cramer favorite, but no more, and UnitedHealth Group (UNH) - Get Report could be a buy once it goes a little lower.
Verizon (VZ) - Get Report is a good stock to own, especially with it's 4.5% yield. Meanwhile, shares of Visa (V) - Get Report trade at a lofty 28 times earnings and don't have a global slowdown baked in. Cramer panned Walgreens Boots Alliance (WBA) - Get Report and even felt Walmart (WMT) - Get Report needed to be lower before it could be bought.
Executive Decision: SS&C
For his "Executive Decision" segment, Cramer spoke with Bill Stone, chairman and CEO of SS&C Technologies (SSNC) - Get Report, the financial software provider with shares off more than 31% from their highs due to the overall market meltdown.
Stone said that while some of the clients are slowing down their operations, there is still money being made and businesses looking for opportunities and that's what SS&C helps them do. He said their software provides services like real-time profit-and-loss statements, allowing money managers to made decisions in real time as well.
When asked about their response to the coronavirus, Stone said that SS&C has a distributed workforce, with employees in New York, London, India and also in China and Hong Kong. He said their Asian staff has been working from home for weeks now and they've only seen minimal degradation in their performance as a result.
Investors looking to pick through the rubble should consider stocks like Schrodinger SDGR, Cramer told viewers. The company makes technology for the lifes ciences industry and has everything investors are looking for.
Schrodinger came public a little over a month ago and shares surged 24% before falling with the markets back to their IPO price. Cramer explained that Schrodinger helps big pharma and biotech companies design molecules in the lab that can then be manufactured and tested in the real world. The company claims to help cut drugs discovery times by up to 50%.
But Schrodinger does a lot more than just life sciences. It's technology is used for materials science and other applications as well. Given its high growth rate, Cramer said, Schrodinger is a winner.
Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Wednesday evening:
BP (BP ADR) : "This is an oil stock and it's horrible."
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At the time of publication, Cramer's Action Alerts PLUS had a position in DIS.