Jim Cramer Slams FTC Chair Lina Khan's Policies For Hampering Investor Returns: 'One-Woman Wrecking Crew For Your Stock Portfolio'

CNBC’s “Mad Money” host Jim Cramer expressed concern over the damaging impact on investor portfolios, attributed to the policies of Federal Trade Commission (FTC) Chair, Lina Khan.

What Happened: Cramer’s criticism, aired on Monday, centers around Khan's opposition to mergers and acquisitions. He posits that such actions have negatively impacted stock valuations, citing the case of the proposed merger between Nippon Steel NPSCY and United States Steel Corporation X.

Cramer argues that the premium Nippon Steel was willing to pay for U.S. Steel indicates Wall Street’s undervaluation of the latter, a trend he links to an overemphasis by investors on interest rates.

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Furthermore, Cramer suggests that potential mergers and acquisitions could promote competition across different sectors. He presents hypothetical examples of possible mergers, such as Merck MRK with Bristol-Meyers BMY or Kraft Heinz KHC with Hershey HSY or General Mills GIS contending that such unions would enhance competitiveness within their respective industries.

Why It Matters: Recently, Khan and the FTC have sought to impede Microsoft‘s MSFT purchase of Activision-Blizzard and Amgen’s acquisition of Horizon Therapeutics. Despite these endeavors, the formidable legal departments of these corporations have managed to overcome the bureaucratic obstacles, contrary to Khan’s goals, according to Cramer.

"Yep, Khan's been a one-woman wrecking crew for your stock portfolio even as stocks have done quite well without a deal,” he said.

Khan’s tenure as FTC Chair has been marked by a hard stance against Big Tech. Amazon.com AMZN has hired several former FTC officials in preparation for an antitrust battle with the regulator. Subsequently, Khan filed an antitrust lawsuit against Amazon which could potentially disrupt parts of the company

These actions reflect Khan’s commitment to curbing corporate consolidation, a stance that Cramer argues is counterproductive.

In his words, "Lina Khan wants to stop corporate consolidation, yet she's created a situation where only the largest, wealthiest companies can afford all the litigation that now comes with making acquisitions.”

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