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NEW YORK (TheStreet) -- As a general rule, don't take your investment advice from the head of the Federal Reserve. That was Jim Cramer's advice for his Mad Money viewers Wednesday after Janet Yellen spooked the markets by calling stock valuations "potentially dangerous."
While the Fed does like to opine on stocks from time to time, Cramer noted its track record to date has been less than stellar. Everyone remembers Fed Chair Allen Greenspan's infamous "irrational exuberance" statement from 1996, the one that would have kept you out of one of the best bull markets in recent memory.
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But even as late as last year, Yellen expressed worries over the biotechs and social media stocks
, calling them "stretched." That call too has proven to be dead wrong, sans a handful of notable exceptions like Twitter
, a stock Cramer owns for his charitable trust, Action Alerts PLUS
The fact is that nothing good comes from the Fed commenting on the markets. It only serves to scare people from making long-term investments on great, quality companies.
If the Fed is indeed worried about stock valuations, it has tools at its disposal to fix the problem, mainly its authority to regulate margin requirements. Margin rates, unlike interest rates, only affects those making risky bets in the markets using borrowed money.
So use Yellen's cautionary words to maybe take some profits, Cramer concluded. Don't use them as an excuse to sell or scare you out of the markets altogether. Some stocks are indeed overvalued, as they always are, but the overall markets are still doing just fine.
As for Yellen, she's still batting zero.
Executive Decision: Irwin Simon
For his "Executive Decision" segment, Cramer sat down with Irwin Simon
, chairman, president and CEO of Hain Celestial
(HAIN - Get Report)
, the natural and organic food provider whose stock has risen over 500% since Cramer first took notice in September 2005, but also one that has fallen over 10% from its March highs.
Simon told Cramer he was very pleased with Hain's most recent quarter
, which included 19% revenue growth, but Hain is not a quarter-to-quarter story. Hain, he said, is changing the way the world eats and is taking its cues from the 93 million Milennials demanding things such as GMO-free products
If you look at this younger generation, Simon noted, yogurt is replacing processed cereals, healthy teas are replacing coffee and fresh juices are all the rage. That's what Hain is offering consumers.
When asked, "Are farmers getting it?" Simon replied that one of Hain's biggest challenges is procuring fresh ingredients and building the infrastructure needed to support its operations. But even as farmers are converting their fields to organic in record numbers, demand is still outstripping supply.
Cramer reiterated his support for Hain Celestial.
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