“Major Deflationary Disruption” Says Cramer About Amazon Purchase
Mike (Mish) Shedlock | Jun 18, 2017 07:50AM ET
Amazon (NASDAQ:AMZN) bought Whole Foods Market Inc (NASDAQ:WFM) today. Widespread carnage in the grocery stock prices followed. Jim Cramer called it a major deflationary disruption saying stores cannot compete.
“If I was the Federal Reserve, I would have a meeting on this. Inflation is going to go down…. You have to rethink food … Costco (NASDAQ:COST) knows how to compete. It will be in there tooth and nail with toilet paper and paper towels. … But Kroger (NYSE:KR), a crisis in Cincinnati, crisis.”
“Major Disruption of Society”
SupplyChain247 reports Amazon’s Move to Purchase Whole Foods Is ‘Disruption of Society’
TheStreet’s Action Alerts PLUS Portfolio Manager Jim Cramer said Amazon’s move to acquire Whole Foods is a disruption of society, “this is what I regard to be a move by Amazon to destroy the margins and own the business of food and groceries in this country,” Cramer said.
With Amazon putting down $13.7 billion to buy Whole Foods, Bezos is sending a powerful message to his retail rivals;
- Food suppliers will now be dealing with an even larger grocery store, meaning potentially pressured profit margins for organic players such as Hain Celestial.
- Amazon officially shows intent to enter bricks-and-mortar retail in a larger way than just bookstores. Combine that with its unmatched digital presence, Walmart (NYSE:WMT), Target Corporation (NYSE:TGT) and others have been put on notice.
- Grocer stores like Kroger will now be in an even bigger price war.
- Amazon Prime integrated into Whole Foods could hurt Costco over time. Many Costco members are also Prime members.
“What Amazon did to the mall, it will now do to grocery stores,” said Cramer.
Here is a Tweet to think about:
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.