Jim Cramer reminds investors that market pain is necessary to avoid endless price increases

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TBEN’s Jim Cramer reminded investors on Thursday that stock market pain is unfortunately necessary for the Federal Reserve to win against inflation.

“No one wants layoffs or chasing lower stock prices. But the alternative is sustained high inflation — endless price increases for everything — and no one wants that,” he said.

Shares fell on Thursday after new data indicated the job market remains strong despite the Fed’s aggressive rate hikes to curb rising prices.

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Cramer explained that while the Fed must ensure that companies can no longer raise prices for goods and services, such an outcome is inevitable and will hurt portfolios.

“Lower house prices – it’s good if you’re looking for a house, but it’s terrible if you own shares in home construction lennar“, he said as an example. “In other words, there is no free lunch for you, the investor.”

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And while it’s unclear when the central bank will be able to reverse its rate hikes and stop hurting the market, he said the release of the non-farm payrolls report on Friday will shed more light on the inflation.

“If it doesn’t show higher unemployment without wage growth, the Fed will have to keep raising rates aggressively,” Cramer said.

Jim Cramer reminds investors that market pain is necessary to avoid endless price increases