CNBC’s Jim Cramer defended Federal Reserve Chairman Jerome Powell on Monday after the central bank chief promised aggressive action on inflation.
“Powell got an insanely bad hand. So, of course, he fell behind. That’s why he said the Fed would act with alacrity from now on,” the Mad Money host said. “So feel free to blame him for not seeing what was coming. [50 basis point interest rate hike]he will.”
“Never forget that Powell was asked to do the impossible here: figure out how to quickly raise interest rates when so many things should naturally slow the economy and bring down inflation, but nothing worked the way we expected,” he added.
Powell vowed on Monday that the Fed would take strong action against rising inflation, which is currently at its highest level in 40 years. Powell said a rate hike of more than a quarter of a percentage point was possible and the hike would continue until inflation was brought under control.
His firm stance against inflation, which came a week after the Fed raised interest rates for the first time in more than three years, sent the market swinging on Monday, breaking a multi-day streak. The Dow Jones Industrial Average fell 0.6% and the S&P 500 fell 0.04%. The Nasdaq Composite fell 0.4%.
Listing a host of recent market turmoil, including the current housing shortage, semiconductor chip shortages, healthy consumer spending, Covid fears and Russia’s invasion of Ukraine, Kramer reiterated that in these unprecedented times, it’s hard for Powell to foresee what will hit the market. next.
Cramer added that he thinks it’s unfair that investors expect Powell to predict the path the pandemic will take.
“At the end of the day, public health is outside the Fed’s purview,” Cramer said.