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Cramer's 'Mad Money' Recap: Buy the Dips (Final)

Cramer says don't get shaken out. The right move is to buy on the dips, not sell.

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) -- "Investors have paid a high price for being too negative," Jim Cramer told the viewers of his "Mad Money" TV show Tuesday. He said that while the markets have had a remarkable run in 2009, those who were too negative were left in the dust.

Cramer recounted the three times this year when being too negative proved to be a costly mistake. He said the first inflection point was when the markets hit their lows in March. Back then, Cramer said even he was afraid to turn positive on the markets. But after a bottoms-up analysis of the


, he determined the lowest the markets could go was Dow 6,500, and the downside was just too limited not to be a bull.

The second inflection point came in May, when a flood of secondary offerings from the banks stopped the financial sector in its tracks. So many investors felt the markets couldn't rally without this key group and sold off in droves, Cramer said. But that too was wrong, as the industrials and the health care sectors picked up where the financials left off, and the markets again rallied.

Finally, there was late October, right after the market hit Dow 10,000. After a sharp pullback to Dow 9,600, investors again sold in droves, opting for the illusion of safety in U.S. Treasuries or bond funds. Once again, this move was costly, said Cramer, as the markets rallied once more.

Cramer said there are a lot of positives in the markets outside of just earnings. He said the housing market is stabilizing and China is pulling the whole world higher with its very successful stimulus. There's been surprising strength in all of technology, he said, as well as surprising liquidity, allowing countless companies to refinance and sure up their balance sheets.

Cramer said if 2009 has taught us anything, it's that people who left the markets in a panic were unable to get back in, except at higher prices. "Don't get shaken out," he said, "the right move is to buy on the dips, not sell."

Three Dividend Stocks

Investors looking for protection, security and income should forget about bank CDs and bond funds, Cramer told viewers. He said that stocks that pay high dividends offer all three, plus capital appreciation and a favorable tax rate.

Cramer recommended three dividend stocks including,


(MO) - Get Report

, a stock which he owns for his charitable trust,

Action Alerts PLUS


Waste Management

(WM) - Get Report



(MMM) - Get Report


Cramer said Altria is a steady, domestic tobacco company with over 50% market share in the U.S. cigarette market. The company also owns a 50% stake in SAB Miller Brewing and recently acquired

US Tobacco

(UST) - Get Report

, giving it a 50% share in smokeless tobacco products. Cramer said over the last two decades, shares of Altria are up 504% if you include reinvested dividends.

Waste Management is another great dividend stock, said Cramer. In the trash game, it's all about pricing power, he said, and this company controls 30% of the domestic trash market. Waste Management is a consistent dividend raiser, yielding 3.8%.

Finally, Cramer recommended 3M, a company where 29% of its revenues comes from its culture of innovation, which is constantly pumping out new products. The company derives 70% of its revenue from outside the U.S., said Cramer, making it a global recovery play. 3M yields 2.5%, which is small by comparison, but the company has raised its dividend every year for 51 years.

Off the Charts

In the "Off the Charts" segment, Cramer went head to head with colleague

L.A. Little over the chart of

(AMZN) - Get Report

, a stock where it might be better to buy high and sell higher, rather than not buy at all.

According to Little, Amazon is in bull market mode, with its monthly chart taking out its all-time high set back in 2000, and doing so on strong volume. Little said the daily chart is also bullish, showing the stock breaking out in October and successfully retesting its support levels. Little feels Amazon is a buy right now, and would back up the truck under $126 a share.

Cramer agreed with Little's analysis, reiterating his $216 price target on the stock, $82 higher than where it trades today. He said the thesis is simple, ecommerce is getting stronger and Amazon is selling a lot more than just books and music these days. The company is growing at 25%, but Cramer said the estimates for what Amazon could earn are still far too low. Amazon is a buy, he said.

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Mad Mail

In the "Mad Mail" viewer feedback segment, Cramer told a viewer that he's still bullish on




Joy Global



Cramer told a second viewer that he's not backing away from

Huntington Bancshares

(HBAN) - Get Report

, but he hasn't been pleased with the stock's performance as of late.

Lightning Round

In the Lightning Round, Cramer was bullish on

Nordic American Tanker

(NAT) - Get Report


Hartford Financial Services

(HIG) - Get Report


American Tower

(AMT) - Get Report


United States Steel

(X) - Get Report



(NUE) - Get Report


-- 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 Altria.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for, Inc., and CNBC, and a director and co-founder of All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of 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, 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 is related to the specific opinions expressed by him on "Mad Money."

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