The CNBC show Mad Money host Jim Cramer has presented a severe warning in front of investors, calling a dire US stock market crash may happen. More importantly, he connects it to the 1987 Black Monday crash, which wiped out trillions of dollars, affecting the global financial market. As Monday arrived and the market’s downfall anticipated to persist, did Cramer’s prediction come true? Let’s discuss this.
Jim Cramer Predicts 1987 US Stock Market Crash
Apart from his popular show and market prediction, Jim Cramer is known for the inverse Cramer index, a hypothetical theorem. According to this, the inverse or opposite of Cramer’s prediction comes true. As a result, when he predicted a 1987 similar US stock market crash, investors anticipated recovery, but that did not happen.
The US president, Donald Trump, has introduced tariffs, which has led to the ongoing economic crisis affecting all financial markets, including the stock and crypto markets. Due to this uncertainty, Cramer has predicted that a massive crash, similar to 1987, where DJIA fell 22.6% in a single day, may take shape unless Trump revises his aggressive tariff polices.
If the president doesn’t try to reach out and reward these countries and companies that play by the rules, then the 1987 scenario… the one where we went down three days and then down 22% on Monday, has the most cogency.
Has Jim Cramer’s US Stock Market Crash Prediction Come True?
Trump’s tariff and the impacted nations’ counterattacks, like China imposing an inverse 35% tariff on all US exports to them, have resulted in the worst market crash since the pandemic.
The Dow Jones fell 3,910 points across Thursday and Friday, the S&P 500 dropped 5.97%, and the Nasdaq fell 5.8%, wiping out nearly $6.6 trillion. As the market’s downturn persists even today, the Jim Cramer stock market crash prediction seems true as he said, “We will not have to wait too long to know. We will know it by Monday.”
More importantly, he added that he had lived through the 1987 Black Monday crash and knew what it felt like before adding that the employment data is the buffer.
Adding to these concerns, financial institutes like JP Morgan believe that recession might hit America in 2025 due to these US policies. Amid this chaos, investors’ sentiments are seriously affected, with a few analysts like Peter Schiff claiming that the market did not crash because of tariffs but due to the fear of the tariffs’ continuing.
‘Donald Trump’s Market Crash Has a Purpose’
Amid the extreme criticism, Donald Trump stood true to his initial claims, calling tariffs an important measure to make America wealthy again. In a recent Truth post, Trump revealed that the country had a massive financial deficit with China, the European Union, and many others.
More importantly, he claimed that Tariff is the solution as they would bring billions of dollars to the country before asserting that people will realize their positive impact someday.
White House National Economic Council director Kevin Hassett also said that the stock market crash is not an intentional strategy. Still, it has the purpose of making America rich as it can push cash into treasuries.
It weakens the dollar, drops the mortgage, and does much more to benefit Americans. He added that it’s a wild chess move, but it’s working.
Although Jim Cramer’s US stock market crash prediction generates concern, there’s hope around the inverse Cramerer index, countries like Japan are willing to negotiate, and there is a possibility of Trump putting a hold on tariffs.
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