Cramer's Morning Take: Consumer Stocks 4/20/23

Jim Cramer (0:01)

Hey, it's Cramer, and this is my morning take on the market from today's CNBC Investing Club Morning Meeting.

We're all kind of focused, I know, on Elon Musk, and whether it be his car or whether it be his rocket. I want to bring us back to earth and say this pattern I see of the market opening down off of Europe continues, and people are then picking their spots. I will tell you, Jeff, that the drumbeat of recession is very hard to stop, even as DR. Horton reported great numbers, even as I see Newcore reporting great numbers. They're all mad tonight. So it is not a cut-and-dried must-have recession. I don't see it.

Jeff Marks (0:38)

Sure, and of course, some of the reasons why Tesla is down today is because they are lowering prices for their vehicles, and that is deflationary.

Jim Cramer (0:47)

But that's deliberate.

Jeff Marks (0:49)

Right, well, it's deflationary, which is good for the consumers, bring down pricing there. But also, the American Express now, of course, they had some provisions, much like every other bank that has reported, but they're more, you know, credit card. But the spending data was very strong there. So we are seeing a lot of consumer stocks rallying today.

And as long as you have the consumer, perhaps the economy can still keep running.

Jim Cramer (1:12)

Let me give you a microcosm of what I see happening that's bad, all right? So airline spending is going on, traveling on air, it was up 60% year-over-year in American Express.

Now, we know that the capacity of airlines has not increased at all, which means airline tickets are going up and airline tickets are a crucial part of the CPI. When we read Horton, we know that houses are still short in supply. Another key component of the CPI is rent. Rent and tickets were the worst part of the CPI. So there will be no cessation of higher CPI now.

Jeff Marks (1:48)

They keep saying rent is on a, that's one of the big lagging factors that will happen from the rates. It still hasn't really come down. I know in Manhattan it recently made a new all-time high, and that's ahead of the summer months when it picks up even further. So a little concerning trade there.

Jim Cramer (2:06)

I bought into this for a while because the mayor suggested that you can take these class B, C buildings and make them into residential. It's $700 to $800 a square foot to do it. So you have to tear them down. It's something we have to continue to watch.

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SPEAKER_3 (2:34)

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