CNBC’s Jim Cramer says the compass has changed when looking at the stock market. For at least a year, money mangers would use the Federal Reserve as a guide for whether to buy or sell. For so long, “good news was bad news.” Any strong economic news, ironically, would have caused a selloff out of fear the Federal Reserve would raise interest rates, thinking the economy didn’t need propping up anymore.
Things have changed in the last few months, Cramer observed on Mad Money. When Janet Yellin announced the cessation of bond buying, the markets didn’t swoon. And with the release of the strongest GDP number in ten years, a rise of 3.95%, the markets didn’t panic, but there was a some kind of rally.
Cramer thinks investors should throw out the “bad is good” compass and embrace the good in the U.S. economy, particularly given the weakness globally. In this scenario, foreign investors will be interested in U.S. stocks, and it is earnings of companies bringing up the market, not hype.