Erasing the negatives, one by one

China's lending slowdown will help the country move toward sustainable growth. Once that's achieved, we will have removed a key problem in the world economy.

By Jim Cramer Jun 13, 2011 9:17AM

jim cramerthe streetSo China's lending is slowing, and now we freak out? We sit here every week fretting about what the Chinese central bank will do to slow down its economy, and when we get a sign of a soft landing -- like lower lending -- that sends property stocks down?

 

Oh, please. This is exactly what we want, for the Chinese to get rid of real-estate speculation. If we can just see some slowing of wage inflation, we could be getting there.

 

Where is getting there? When the Chinese achieve sustainable growth, we will be removing one of the key negatives in the world's economy. No, it doesn't cure Japan, and it won't send oil down. Greek bonds will still make Europe tremble. But it's been six weeks straight down, and we know that one of the proximate causes is tightening in China.

What I am looking for is a sell-off in companies like Freeport-McMoRan (FCX), which we have been buying for ActionAlertsPlus.com, and then a rally as people recognize that the price of copper is not going to fall off a cliff and that FCX will soon benefit from the rebuild in Japan. The amazing thing about this whole period, though, is how dysfunctional Japan really is. There are tens of thousands of people without homes, and they are almost like Katrina over there? George W. Bush as adviser?

 

Still, the pieces of the puzzle, while not in place, at least show a sign of resolution when it comes to the world's most important economy now that the U.S. has shown its lack of importance to world growth.

 

It's a beginning, and it is certainly what we wish for.

 

At the time of publication, Cramer was long FCX.

 

Jim Cramer is co-founder and chairman of TheStreet. He contributes daily market commentary for TheStreet's sites and serves as an adviser to the company's CEO.

 

Follow Cramer's trades for his Charitable Trust.

 

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4Comments
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Cramer -- China is about ready to make a hard landing and unlike the US and Europe when China gets cold the rest of the world gets the flu.

China is facing a very hard food shortage right now and nobody knows just how that is going to play out. 

China has been driving the World economy for a while now. The US is near going to recover our politicians have sold us down the river to the slavers. Europe is a joke broke economies trying to bail out even more broke economies. South America and Africa are still economic disasters. The middle east is starting to glow in the flames of burnt oil fields. And Australia is in a recession. Japan is a disaster that will take decades to fix as they are broke also.

Take China out of the picture and we are looking at great depression II
Jun 13, 2011 5:20PM
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Making GWB jokes and cheering about profiting from other people's misery... Yeah that's Cramer, MSN Money's worst writer.    

How is the dysfunctional-ism of Japan after a natural disaster that killed 18,000+ people "amazing"?      You have kids who don't even know where the bodies of their parents are.  

Maybe one of this year's wild tornados will come by your house and you can show us how great you can handle a natural disaster.




Jun 13, 2011 11:04PM
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Too many people to feed, spending too money on busting weed, still , greed, greed and more greed.
Jun 13, 2011 10:31AM
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Oh please Mr. Cramer tell us what to do about China, oh please please Mr. Cramer what are we to do???
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