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Cramer's 'Mad Money' Recap: 'Tis the Season for Stocks

TheStreet.com Staff

Click here for an archive of Cramer's "Mad Money" recaps.

With Christmas on the way and Hanukkah right around the corner, the single greatest present parents can get their children this year is one share of stock, Jim Cramer told viewers of his "Mad Money" TV show Monday.

Cramer said it has to be the right stock -- one that will get kids interested in the market and one that will teach about them the value of money.

Cramer specifically noted Viacom (VIA-B), a company that has some of the best child-related properties around and one that he considers a buy anyway.

Viacom, he said, has been cheap since it was split off from CBS (CBS). Plus, the stock has a catalyst: its Rock Band video game, which Cramer believes could be the thing to send Viacom higher.

Cramer said Rock Band is so popular that it's impossible to get it. He said Activision's (ATVI) Guitar Hero game also is quite popular but lacks versatility.

Cramer expects Rock Band could be bigger than Guitar Hero. The game costs $170 and is selling out, he said. While the margins on the actual game package are not that high, Viacom charges players for songs they download --- another way to get people to pay for music again.

Viacom is not getting enough credit for this great game, Cramer said.

The best present parents can give their kids this holiday season is the talent for managing money, he said. Give them this gift with a share of Viacom.

Perfect World

Cramer said he stands corrected on Perfect World (PWRD) and is turning his previous sell on the company into a buy.

When a viewer called in last week during a "Lightning Round" segment, Cramer said he put Perfect World in the "Don'tBuy" camp because he tends to be skeptical about Chinese stocks, because they lack stringent securities regulation. "I let my professional bias come between me and what I now know is a great idea," he said.

Perfect World, Cramer said, does file financials. Furthemore, he said, it has put up great numbers and just had an enormous upside surprise, where it beat earnings estimates by 81% and sales estimates by 43%.

"Perfect World is worth owning," he said, noting it has real customers and solid earnings visibility. Cramer said the decision by Vivendi, a developer of interactive games, to buy Activision underscores the increased popularity of these interactive role-playing games are.

He said Perfect World is ahead of the competition, with new games on the horizon. He said he expects Perfect World to benefit from the launch of the highly anticipated "Chi Bi" game set to come out later this month.

At the same time, he said the stock is speculative and not for the faint of heart. While it could be a buy on the cheap with the potential to rise later on, the fact that Perfect World is inexpensive doesn't mean it won't head lower, Cramer warned.

Perfect World could go to $40 next year, but it is a buy only if it is below $26, he stressed. The stock closed at $24.33 Monday.

Sticking It Out

Although Cramer believes the financials have bottomed, that doesn't mean the market is not going to test that bottom again in the near future, he said.

"We believe the Fed will cut rates when it meets on Dec. 11, because the financials are too troubled to keep rates the same, Cramer said. And when the Fed does go through with the cuts, it will send the banks much higher and the rest of the market will follow.

People should own the financials only if they believe a rate cut is coming, he said. Otherwise, they should be stick with the defensive plays and the "indestructibles."

"Right now you should own the Colgates (CL) of the world if you think I am dead wrong [about a rate cut,]" Cramer said.

Between now and next Tuesday, everything he knows about the market is telling him the bears are going to be battling full bore, and that market players are going to be bombarded with bad news , Cramer said. "You'll be lucky if between now and next week you see one or two things that make you think the market is worth sticking around in."

However, people shouldn't let the short-term bad news scare them out of a good long-term story, he said.

"Say you own a bank stock like Wells Fargo

(WFC), which is among the best," Cramer said. "The market might try to spook you out of owning it, but don't be spooked. You are owning it for a Fed cut."

Cramer believes there will be a cut because things are so bad and a Fed cut, he said, will trump the negativity. "Think about the long-term idea," Cramer urged viewers. "Do not be shaken out."

Mad Mail

In his "Mad Mail" segment, Cramer said CEOs are "extremely highly paid people who run public companies." He said he is hard on certain chief executives because they are paid millions but lose money for people.

Lightning Round

Cramer was bullish on ITT Educational Services (ESI), Yamana Gold (AUY), Barrick Gold (ABX), EMC (EMC), Merck (MRK), Wyeth (WYE), Celgene (CELG), Schering-Plough (SGP), McDonald's (MCD) and Goldman Sachs (GS).

Cramer was bearish on Noah Education Holdings (NED), NovaGold Resources (NG), Pfizer (PFE), Starbucks (SBUX), Advanced Micro Devices (AMD) and D.R. Horton (DHI).

Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by clicking here.

For more of Cramer's insights during the Lightning Round, click here.