Cramer's 'Mad Money' Recap: Bernanke Got It Right (Final) - TheStreet

Cramer's 'Mad Money' Recap: Bernanke Got It Right (Final)

Cramer says the Fed chairman saved the country from a Great Depression and is making sure today that the stimulus isn't being withdrawn too early.
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NEW YORK (

TheStreet

) -- "The time when

Federal Reserve

Chairman Ben Bernanke knew nothing has long since past," Jim Cramer told the viewers of his "Mad Money" TV show Wednesday.

Cramer said it's been over two years since his infamous 2007 "they know nothing" rant, and today he said that

Time

magazine's "Man Of The Year" moniker is much more fitting for Bernanke.

Cramer said in retrospect, Bernanke didn't see the apocalypse coming. The Fed chair was raising interest rates right up until the crash, and even ridiculed Cramer for his incendiary remarks. Shortly thereafter, a wave of foreclosures overtook the markets, unemployment rose up over 10%, and high profile companies, such as Washington Mutual, Lehman Brothers,

Fannie Mae

(FNM)

,

Freddie Mac

(FRE)

and

AIG

(AIG) - Get Report

, began to fail in spectacular fashion.

But Cramer said after the crash began, Bernanke did "get it," and swung into action in a big way. He said the Fed chair called the bottom in March, when he assured the markets there would be more bank nationalizations. Bernanke lowered interest rates, added liquidity, bought over $1 trillion of mortgage back loans, and offered whatever assistance he could to save failing companies, he said.

"Yes, he was late," said Cramer, "but he got it right when it really matter." And that's why he said he's not quick to criticize Bernanke now, as did the markets today, for not taking a more aggressive stance on inflation.

Cramer said Bernanke is a student of history, and knows well the problems associated with taking away stimulus too soon. He said with the president not helping the country's economic agenda, Bernanke needs to act alone. "Bernanke knows more than you and me," said Cramer, "and deserves his 'Man Of The Year' award."

Sticking With Best Buy

"Did we blow it? Were we wrong?" These were just two of the questions Cramer asked himself after recommending electronics retailer

Best Buy

(BBY) - Get Report

in last week's game plan segment.

Cramer said he recommended Best Buy on Dec. 2, calling the company the best retail play for the holiday season. He again called the stock a buy last week, encouraging viewers to buy the stock ahead of the company's earnings this week. These recommendations were wrong, he said candidly.

Cramer said while Best Buy did exactly what he expected, beating expectations by 10 cents a share, raising guidance, and announcing strong same-store sales, the stock still tanked 8.5% on the news.

The bears cited conservative margin guidance, slowing international sales and increased competition as reasons not to like the stock. But Cramer disagreed, and said he still likes the stock, even though his timing in recommending it was flawed.

After thoroughly reviewing the company's earnings, Cramer said his thesis for liking it is in tact, and he's sticking with his $50 price target on the stock. He said the company's lower margins are stemming from low-margin netbook computers and entry-level TVs, not from extensive discounting.

Cramer also noted several new product cycles helping to boost sales. And while international sales may have weakened, sales in Canada are already on the rebound.

Cramer said he was definitely wrong to recommend Best Buy ahead of the quarter, especially given its history of selling off on earnings news. But given the strength of the company's business, Cramer said the stock will have no trouble getting to $50 a share, which is nine points higher than his original Dec. 2 recommendation.

Dreamliner's Pin Action

"With

Boeing

's

(BA) - Get Report

new 787 Dreamliner finally in the air, a new aerospace cycle is upon us," Cramer told viewers. But the easy money's been made in Boeing, he said, which means it's time to look for the pin action.

Cramer said the way to play Boeing's new flagship, fuel-efficient plane is through its suppliers. He said the suppliers are more levered to new plane models, and will participate the most in this new aerospace cycle, which will likely span the next seven years.

Precision Castparts

(PCP)

remains Cramer's favorite parts supplier. He said the company makes fasteners and engine components for the Dreamliner, and is estimated to earn $5.5 million for every plane produced. Trading at just 14.5 times its earnings, Precision Castparts is cheap, he said.

Also on the list is

Hexcel

(HXL) - Get Report

, which is likely to derive 22% of its revenues from the Dreamliner. That's $1.3 million to $1.6 million in revenue for every Dreamliner made, he said.

Rounding out the group, Cramer also likes

Spirit AeroSystems

(SPR) - Get Report

, which makes the nose-cone and and wing components,

Goodrich

(GR)

, which makes wheels and brakes, and

Rockwell Collins

(COL)

, which provides cockpit controls.

Am I Diversified?

Cramer spoke with callers to see if their portfolios have what it takes. The first caller's portfolio included

Frontier Communications

(FTR) - Get Report

,

Apple

(AAPL) - Get Report

,

Disney

(DIS) - Get Report

,

IBM

(IBM) - Get Report

and

Procter & Gamble

(PG) - Get Report

.

Cramer said Apple and IBM are not two of a kind, adding he thinks this portfolio is fine.

The second caller's top holdings included

Applied Materials

(AMAT) - Get Report

,

Energy Conversion Devices

(ENER)

,

Pepsico

(PEP) - Get Report

,

Transocean

(RIG) - Get Report

and

Targacept

(TRGT)

.

Cramer said he'd bless this portfolio, although it's a little too speculative for his taste.

The third caller had

IBM

(IBM) - Get Report

,

American Express

(AXP) - Get Report

,

Kimberly-Clark

(KMB) - Get Report

,

3M

(MMM) - Get Report

and

Disney

(DIS) - Get Report

as their top five stocks.

Cramer said the portfolio was picture perfect.

Lightning Round

Cramer was bullish on

Electronic Arts

(ERTS)

,

Petsmart

(PETM)

,

Intel

(INTC) - Get Report

and

Cooper Industries

(CBE)

.

He was bearish on

Trinity Industries

(TRN) - Get Report

,

Gamestop

(GME) - Get Report

,

Research In Motion

(RIMM)

and

Echelon

(ELON)

.

-- Written by Scott Rutt in Washington D.C.

To watch replays of Cramer's video segments, visit the Mad Moneypage on CNBC

.

Want more Cramer? Check out Jim's rules and commandments forinvesting from his latest book by

clicking here.

For more of Cramer's insights during the Lightning Round, clickhere

.

At the time of publication, Cramer was long Cooper Industries, Procter & Gamble, Pepsico.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com or CNBC that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the program. Mr. Cramer's past results are not necessarily indicative of future performance. Neither Mr. Cramer, nor TheStreet.com, nor CNBC guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the program. The strategy or investments discussed may fluctuate in price or value and you may get back less than you invested. Before acting on any information contained in the program, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.

Some of the stocks mentioned by Mr. Cramer on "Mad Money" are held in Mr. Cramer's Action Alerts PLUS Portfolio. When that is the case, appropriate disclosure is made on the program and in the "Mad Money" recap available on TheStreet.com. The Action Alerts PLUS Portfolio contains all of Mr. Cramer's personal investments in publicly-traded equity securities only, and does not include any mutual fund holdings or other institutionally managed assets, private equity investments, or his holdings in TheStreet.com, Inc. Since March 2005, the Action Alerts PLUS Portfolio has been held by a Trust, the realized profits from which have been pledged to charity. Mr. Cramer retains full investment discretion with respect to all securities contained in the Trust. Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast.