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Jim Cramer's Best Blogs

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NEW YORK ( TheStreet) -- Jim Cramer fills his blog on RealMoney every day with his up-to-the-minute reactions to what's happening in the market and his legendary ahead-of-the-crowd ideas. This week he says:

  • the budget bullies are missing the point; and
  • that the consumer fears the cliff.

Click here for information on RealMoney, where you can see all the blogs, including Jim Cramer's -- and reader comments -- in real time.


They're All Missing the Point

Posted at 7:37 a.m. EDT on Friday, Dec. 14

It hit me last night: Here's what I think is so annoying and niggling about the budget talks between House Speaker Boehner and President Obama. I think they don't understand, neither one, the consequences of what they do on the American business public.

That's because, in many ways, the business public is not represented by either person.

As I parse through the Republican and Democrat posturings, I hear two major skeins of thought. For the GOP it's the worries about the small-business person and how much their motivation is being hurt by government tax policies. For Obama it's "the folks who work at places who aren't helped enough by government programs and pay more than their fair share for them in taxes."

That's what makes the whole thing so unrealistic. First, small businesses revolve around bigger businesses. When you set up a small business, unless it is about a particular better mousetrap, what you typically need is traffic -- that which comes from the growth of big business in the area.

Also, you want to create a service or hospitality business? You need someone to cater to. You aren't worried about taxes. You are worried about customers. Who is worried about the customers in Washington? Who is worried that their psyche may be damaged by what Washington is doing? Who is worried about them transacting with the small-business people and those they employ?

How do I know this? As a serial entrepreneur, I recognize that customers are the lifeblood of why you are successful. If you are worried about tax rates, you are going to fail. If you even consider tax rates as a reason to start a business or not to do so, you shouldn't start it. Don't waste your time. Stick to your day job.

The president's focus is equally myopic. He should go spend time with Fed chief Bernanke, who has a really good idea of how people get employed. They get jobs when demand is stimulated, and you get demand when you have a much larger employer set up near you. Otherwise, no one comes by. You don't get any customers. So all you do is figure out how few people you can hire, particularly because now you know that you have extensive healthcare costs that weren't even in the equation before.