On Thursday, Jim Cramer, host of Mad Money, described the 145% duty on China as so extreme that it essentially acts as an embargo rather than a conventional tariff.

“We now have 145% tariff on Chinese goods. Now, a number that high frankly isn’t really a tariff. It’s more of an embargo. Almost nobody’s gonna pay that much of a markup. It’s a recipe for losing money.”

READ ALSO: 10 Stocks on Jim Cramer’s Radar Recently and Jim Cramer Talked About These 8 Stocks.

Cramer said that he believes Trump is more frustrated with prior administrations for what he sees as allowing China to take advantage of U.S. trade policy than he is with President Xi Jinping himself, who Trump continues to speak of respectfully. While Cramer acknowledged that he sympathizes with Trump’s objective, he warned that the country is not prepared to handle the fallout. “As a nation, shamefully, we’ve gotten addicted to cheap Chinese imports,” he said

“I think what we saw today was the beginning of a sorting period between those that have no China exposure and those that do. Unfortunately, those that do employ a lot of people and are excellent companies, but they may not be excellent enough to make it through this new environment and that is a real shame.”

Cramer emphasized that while he believes the U.S. can function without economic ties to China, doing so would significantly raise domestic costs, drive up unemployment, and force reliance on other global partners. The stakes, he said, are enormous. “Yes, we have to take them on now or never,” he stated, but he cautioned that the consequences will involve more pain than the public is likely prepared to accept.

“So the bottom line: Is it worth it? Depends. I think it’s worth some temporary pain to drive a hard bargain though and get a more favorable trade deal out of the Chinese government. But it’s not worth it to go back… [from] $439 billion in imports to zero. Unfortunately, I’m actually thinking that might be where we’re headed.”

Our Methodology

For this article, we compiled a list of 12 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on April 10. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Jim Cramer Discussed These 12 Stocks

12. Costco Wholesale Corporation (NASDAQ:COST)

Number of Hedge Fund Holders: 96

Cramer noted that Costco Wholesale Corporation (NASDAQ:COST) has a “balance sheet to win” as he said:

“Finally, and most obviously, there are three retailers with the balance sheets to win and to own. It’s Amazon, Walmart, and Costco. Take a look around at all the other retailers. They could be in their death rows, death by withdrawal. With the exception of the two big box hardware stores, I don’t know how they can make it if they’re up against those big three.”

Costco (NASDAQ:COST) operates on a membership-only warehouse system. It offers both name-brand and private-label items in large quantities at reduced prices. Aoris Investment Management stated the following regarding the company in its Q4 2024 investor letter:

“Firstly, I think we exercised good valuation discipline in our sales of Costco Wholesale Corporation (NASDAQ:COST) and Cintas. The share prices of these two companies had increased by more than 60% and 40% respectively in the year prior to our sale. It can be difficult as investors to remain objective and not ‘fall in love’ with an investment when it is performing well. A higher share price doesn’t make a business more valuable!

We sold both Costco and Cintas simply for reasons of valuation. These are exceptional businesses that we’d love to own again if valuation permits. Their sales allowed us to recycle portfolio capital into more attractively valued businesses.”

11. Walmart Inc. (NYSE:WMT)

Number of Hedge Fund Holders: 116

Cramer mentioned that Walmart Inc. (NYSE:WMT) is among the “big three” retailers as he remarked:

“Finally, and most obviously, there are three retailers with the balance sheets to win and to own. It’s Amazon, Walmart, and Costco. Take a look around at all the other retailers. They could be in their death rows, death by withdrawal. With the exception of the two big box hardware stores, I don’t know how they can make it if they’re up against those big three.”

Walmart (NYSE:WMT) is a retail company that sells a broad selection of products, including food, health-related items, electronics, apparel, and its own store brands. Appearing on Squawk on the Street in March, Cramer said:

“[On MS commenting that lower income buying rates at Walmart, Dollar General going down] They are are going down. I am concerned about Walmart’s quarter. But the stock has reflected some decline. I am concerned about people who go to the dollar stores. Because when you look at the average. . .you don’t end up being as a good a bargain as you may think. That’s been my experience. Was the Dollar Tree stores do not represent. . . by the way, Family Dollar, jeez you know for years they told me it was good.”