Jim Cramer says congressional spending payments might make inflation worse, however he stays optimistic

CNBC’s Jim Cramer said Wednesday that two behemoth spending bills in Congress have him worried about the trajectory of inflation.

“I’m still a bull — I’ve been bullish since June when I saw commodities go in the right direction. Also, I’d be very bullish on wage inflation if it wasn’t for Congress,”Crazy money“said the owner.

“If the new brand promotion bill doesn’t pass, we don’t have anything to worry about, but if it does, we can expect it to take years and years for the government to use that money,” he added. , based on 2022 Inflation Reduction Act.

Account represents a move by the Democrats reforming the tax code, fighting climate change, and reducing health care costs. The bill, which is a revival of President Joe Biden’s “Build Back Better” bill, would invest more than $400 billion over a decade. USD and will reduce the deficit by 300 billion. USD.

Cramer is also concerned about how CHIPS and Science Act in 2022 could push inflation higher, saying its higher-than-expected cost raised concerns about the Fed’s next moves.

Congress passed a bill to encourage domestic chip production and research in late July. While the star of the show is the $52 billion in subsidies to US companies that make computer chips, the package costs a total of $280 million.

Cramer’s inflation concerns are compounded by Fed leaders’ comments on inflation on Wednesday, which suggest the central bank needs to continue to act aggressively to slow the economy.

“I don’t want others to lose their jobs or their homes… I don’t know how [Fed Chair] Jay Powell can stop trillions of dollars in spending only when our unemployment rate is at its lowest level in decades,” Cramer said.

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