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NEW YORK (TheStreet) -- We want dividends from stocks, not coupons from bonds, Jim Cramer told his "Mad Money" TV show viewers Monday as he offered investment advice for this week's Powerball lottery winner and the founder of Tumblr, who also received a big payday courtesy of Yahoo! (YHOO).
Cramer explained that his usual advice for the super-rich is that "you only need to get rich once," thus sticking with safe investments makes the most sense. That's why his typical portfolio would include foreign investments, along with gold, high-end real estate and even paintings, with very little invested in risky equities. For the moderately rich, equities are also too risky, and Cramer said he used to recommend U.S. Treasury bonds along with corporate and municipal bonds.
But these are not normal times, said Cramer, and the risks to bonds are too great, making them a sucker's bet at best. That's why he said that if he were advising this week's newly rich, he'd recommend high-yielding dividend stocks like master limited partnerships such as Kinder Morgan Energy Partners (KMP) and Enterprise Product Partners (EPD), along with a REIT like Healthcare Trust of America (HTA), which combined would yield a healthy 5%.Cramer said he'd also go with strong growth names like Johnson & Johnson (JNJ) and General Mills (GIS), both of which offer yield plus growth. All equities have risks, Cramer concluded, but in today's market, those risks are less than that of bonds. Think dividends, not coupons.
Executive Opinion: Ben BaldanzaIn the "Executive Decision" segment, Cramer sat down with Ben Baldanza, president and CEO of Spirit Airlines (SAVE), which today delivered a three-cents-a-share earnings beat. Shares of Spirit are up 22% since Cramer last spoke with Baldanza in March. Baldanza once again explained that Spirit is not in the business of catering to business travelers but to those paying for tickets themselves. He said his company's no-frills approach allows those who want luxuries and extras to still get them, but for a price. Meanwhile, other passengers can still pay the lowest fares. When asked about the company's extra fees for printing boarding passes or its new, non-toll-free call center, Baldanza said Spirit is training its customers how to behave in ways that save money. He said printing a boarding pass at home costs nothing, but doing it at the airport costs time and money, so the airline charges the customer for that service.
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