Jim Cramer’s Survival Play: Bitcoin and Gold as U.S. Debt Gets the Side-Eye

Wall Street’s loudest cheerleader just flipped crisis mode on. With the U.S. debt downgrade looming like a bad credit score, Jim Cramer’s pitching crypto and shiny rocks as your financial lifeboats.

Gold’s ancient, Bitcoin’s chaotic—but hey, at least they’re not Treasury bonds. Because nothing says ’trust the system’ like a credit rating that’s got analysts reaching for the panic button.

Bonus jab: Because when traditional finance starts sweating, nothing soothes quite like an unbacked digital asset and a metal we dig up for jewelry. Priorities, right?

TLDR

• Jim Cramer recommends Bitcoin and gold as hedges against concerns over U.S. debt downgrade by Moody’s
• Cramer says market dips after credit downgrades typically recover, calling fear “what must be tamed”
• U.S. debt stands at $36 trillion, with Bitcoin trading above $105,000
• Cramer criticized doomsayers as either “fools who know nothing” or “shrewd short sellers”
• Markets largely shrugged off the downgrade with minimal impact on major indices

CNBC’s “Mad Money” host Jim Cramer has advised investors to consider Bitcoin and gold as hedges against growing concerns over the U.S. government’s rising debt levels following Moody’s recent credit downgrade.

The veteran market commentator urged calm among rattled investors, suggesting they focus on strategic investments rather than panic selling.

“Fear is what must be tamed, if you want to be a good investor,” Cramer stated on his show Monday.

His comments came after Moody’s downgraded U.S. debt, the last major rating agency to remove America’s triple-A badge.

The U.S. national debt currently stands at a staggering $36 trillion. Despite this eye-popping figure, Cramer pointed out that previous credit downgrades by other agencies had only temporary market effects.

The financial commentator reminded viewers that similar market reactions occurred after S&P’s downgrade in 2011 and Fitch’s in 2023. In both cases, markets initially dipped but later recovered.

Market Response

Markets appeared to validate Cramer’s take, largely shrugging off the downgrade news. The S&P 500 remained stable NEAR Friday’s close, while the Dow Jones Industrial Average registered gains for a sixth consecutive session.

Small-cap stocks lagged behind the major indices. Thirty-year Treasury yields initially jumped above 5% before buyers pulled them back to 4.95%.

The dollar index slipped 0.6% following the news. Energy shares were among the day’s modest losers as crude oil prices dipped and natural gas prices fell by 6%.

Bitcoin has been performing well amid these developments. The leading cryptocurrency traded above $105,000 after a Senate vote advanced a stablecoin bill, showing its potential appeal as an alternative store of value.

Investment Strategy

Cramer was clear in his message that the downgrade should not be interpreted as a signal to exit the market. “Reading Friday’s late-day notice as a sell signal is a mistake,” he warned viewers.

Instead, he framed the downgrade as “an early warning to invest more, not more aggressively, but more of what you can save.” This approach, he suggested, represents the real hedge for those worried about government creditworthiness.

The host did not hold back criticism for market pessimists. He characterized those predicting severe downturns as “either fools who know nothing or incredibly shrewd short sellers who really need to spread fear because of their business model.”

Both assets Cramer recommended—Bitcoin and gold—showed positive price movement following the downgrade. Spot Gold rose early Monday, adding to its appeal as a traditional safe-haven asset.

Broader concerns remain about whether chronic U.S. borrowing could eventually undermine the dollar’s status as the world’s reserve currency. However, immediate market reactions suggest investors remain confident in U.S. assets despite the downgrade.

Economist Peter Schiff offered a different perspective, criticizing Treasury Secretary Scott Bessent for placing blame solely on former President Joe Biden. Schiff argued that Trump-era tax cuts and bipartisan spending excesses contributed to the conditions that led to Moody’s downgrade.

The Dow Jones Industrial Average closed at 42,792.07 points, while the Nasdaq settled at 19,215.46 points. The S&P 500 index finished at 5,963.60 points, showing that markets remained relatively stable despite the debt concerns.