The American economy needs another stimulus check "badly," according to CNBC's Jim Cramer. On Friday, Cramer gave his explanation as to why another major stimulus package is the best thing for the ailing market on his show, Mad Money. Even knowing the risks of driving up the national budget deficit, he hopes to see the U.S. Congress strike a deal soon.
"I know it's not a huge news week, but this market's badly in need of another stimulus package," Cramer said. "I think the next move hinges on whether or not Congress can get its act together to pass something, an event the market needs to break out of its doldrums." This commentary followed a day of mixed results for the market, where the Nasdaq Composite was reportedly the only major index to fall. However, the S&P 500 hardly moved at all, climbing just 0.05 percent after a terrible week.
Like most economists, Cramer subscribes to the school of thought which says that widespread spending is the best thing to get an economy moving and help heal it during a catastrophic crash like this one. For that, Americans need money, but with unemployment still high and the coronavirus pandemic raging on, he does not see that happening without a stimulus package.
Cramer continued to dish out advice for those that are still trading stocks, however. Contrary to what one might think, he advised against investing in any of the pharmaceutical companies working on COVID-19 vaccines around the world.
"There's no way anyone makes big money off a vaccine. Every country on Earth is going to put price controls on this thing," he predicted. "When it comes to Big Pharma, I care about potential blockbusters, and that's why I'll be paying close attention when Pfizer holds its virtual analyst meeting on Monday."
On the upcoming research and development presentation from drug manufacturer Moderna, Cramer said: "I'd love to hear what else they have in the pipe besides their potential Covid-19 franchise. Maybe they'll give us an update on how the big vaccine trial is going."
While Cramer and many other economists still support another stimulus package, the United States Senate and House of Representatives are still a ways off from reaching a deal. The two sides are split over the budget of the bill itself, with Republicans seeking to keep it close to $1 trillion and Democrats looking for at least $2.2 trillion. In the meantime, Americans are desperate for more aid.