Click here for an archive of Jim Cramer's MadMoney recaps.Click here to get Jim Cramer's Mad Money Post Game video exclusivelyon TheStreet.com.
NEW YORK (
) -- "On down days like today, you have to stick with your game plan," Jim Cramer told the viewers of his "Mad Money" TV show Thursday.
Last Friday, Cramer laid out his plan for this week, and now that his predictions are coming to fruition, he said investors need to stick with the plan.
Cramer warned Friday that if stocks like
Bed Bath and Beyond
were met with resistance when they reported, that would send a signal that it's time to get more defensive.
And that's exactly what happened, he said. In addition, the latest read on housing sales and oil inventories both signaled that things are not recovering as quickly as expected.
Cramer said this news means we have to follow his plan, take some profits, and prepare for a possible 3% to 5% decline in the markets. He said investors need to stick with the investment themes they believe in, buy in increments on the way down, and always keep a shopping list of stocks they'd like to buy handy.
Cramer also predicted last week was that weakness in
Research In Motion
( RIMM) might pull down the mobile Internet stocks. That happened, said Cramer, and now's a great time to buy into that group.
, which had good things to say. Cramer said that stock is signaling that all is well in the aerospace sector.
For defensive names, Cramer likes
Procter & Gamble
, a stock which Cramer owns for his charitable trust,
Action Alerts PLUS, along with
. "We're staying defensive," said Cramer, "until proven otherwise."
ETFs of Mass Destruction
In the Thursday "Sell Block" segment, Cramer threw three more "toxic" exchange-traded funds into maximum security with no possibly of parole. He said these "ETFs of mass destruction" do not do what most investors think they do, and as a result, will wipe out their portfolios. Cramer has long advocated banning these products outright, as they only serve to manipulate stock prices and pray on the uninformed.
In the No. 3, Cramer added
Direcxion Daily Financial Bull 3X Shares
" along with its bearish counterpart that trades under "FAZ." Cramer said these funds are designed solely for day traders and claim to offer three times the return. But Cramer noted that these funds reset daily, wiping out gains if not sold daily.
In the No. 2 spot was
U.S. Natural Gas Fund
a fund Cramer has panned previously. Cramer said this fund has done nothing recently, despite a major move in natural gas. Why? He said the fund, which doesn't buy gas, buys gas futures, which it then must roll over every month, again wiping out gains.
Last on Cramer's hit list was
PowerShares DB Crude Oil Double Short ETN
. Cramer said in addition to its totally confusing name, this fund is confusing as to what it does.
He said it supposedly tracks a basket of futures contracts, but the fund is set up to trade like a note, rather than a fund. Cramer said there are all sorts of inherit regulatory risks for this this fund, and investors need to steer clear.
"There are a lot of really bad ETFs out there," warned Cramer. He advised all investors to simply take a pass.
Am I Diversified?
Cramer played "Am I Diversified" with callers to see if their portfolios have what it takes. The first caller's portfolio included:
Bank Of America
Cramer said this portfolio had two of a kind with Target and Children's Place both being retailers. He said he'd add a defensive stock like
The second caller's top holdings included
Cramer said in this market, both Becton and Merck trade together as health stocks, so he advised selling Merck in favor of a bank stock like
Bank Of America
The third caller had
Johnson & Johnson
Plains All American
as their top five stocks.
Cramer said while this portfolio was focused on high-dividend payers, it was too levered to oil with the two pipelines and Linn Energy to boot. He recommended making changes to further diversify.
In his final segment, Cramer followed up on two lightning round stocks that recently stumped him,
DuPont Fabros Technology
, along with a recently featured IPO,
Cramer said DuPont Fabros is actually a real estate investment trust that owns large scale computer data centers. He said the stock looks pretty good, but noted that he needs clarity on the company's dividend before he can recommend it. NVE, he said, is a tiny technology company with patented, yet unproven memory technologies. He said this company is extremely speculative.
Earlier in the week, Cramer highlighted battery maker A123 Systems, which went public today at $13.50 a share before rising rose to close the day at $20.19. Cramer said its time to ring the register on A123.
Cramer was bullish on
He was bearish on
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
For more of Cramer's insights during the Lightning Round, clickhere
At the time of publication, Cramer was long Procter & Gamble, Bank of America, General Electric, 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.