Jim Cramer Says Congressional Spending Bills Could Worsen Inflation, But He Remains Optimistic

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

“I’m still a bull – I’ve been feeling bullish since June when I saw commodities going in the right direction. And I’d also be very confident about wage inflation, if it wasn’t for Congress. “, the “Mad Money” host says.

“If the renamed stimulus bill does not pass, we have nothing to fear, but if it does, we can only hope that it will take years and years for the government to put that money to work,” he added. , referring to the Inflation Reduction Act 2022.

The bill represents a move by Democrats to reform the tax code, fight climate change and cut health care costs. The bill, which is a relaunch of President Joe Biden’s Build Back Better Bill, will invest more than $400 billion and reduce the deficit by $300 billion over a ten-year period.

Cramer said he was also worried about how the CHIPS and Science Act of 2022 could increase inflation, saying its higher-than-expected price raises concerns about the Fed’s next steps.

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

Cramer’s inflation concerns are complicated by hawkish inflation comments from Fed leaders on Wednesday, suggesting the central bank must continue to take aggressive action to slow the economy.

“I don’t want other people to lose their jobs or their homes. … I have no idea how [Fed Chair] Jay Powell can stop spending billions of dollars just when we have the lowest unemployment rate in decades,” Cramer said.

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