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) -- "As stocks go lower, it makes less sense to sell them, Jim Cramer told viewers of his

"Mad Money"

TV show Wednesday as he opined on yet another abysmal day on Wall Street.

Cramer said the market is getting too hated when compared to how companies are actually performing.

Cramer said the markets are a self-correcting entity. He said fears and worries cause selling, but that selling will eventually end when either prices fall to a level when the bears are converted back into bulls or when there simply aren't any more bears left to sell. He said the markets may have not reach either of these levels yet, but stocks are among the cheapest Cramer's ever seen them.

Cramer said investors need to keep in mind that stocks represent real companies with real values. And while the banks may be tied to the financial woes in Europe and the tech stocks may be in a seasonal slump, the rest of the market shouldn't be as low as it currently is.

Cramer said only two companies,

Scott's Miracle-Gro

(SMG) - Get Report



(OI) - Get Report

, have reported actual disappointments this quarter. Everyone else is still doing OK.

According to the latest investor sentiment numbers, nearly 63% of all investors are bearish on the markets or feel we're in a correction. That's a high number, he explained, which means that most of these bears either are selling or have already sold. That doesn't leave too much further to fall, he concluded.

Middle-Class Squeeze

The middle class in America is evaporating, Cramer told viewers. He said that time and time again companies have proven that high-end luxury items are doing well and low-end trade down plays are doing well, while everything in the middle is getting slowly squeezed out of existence.

So with private label brands taking increasing share as consumers pinch pennies, Cramer said the private label companies might be the only safe bet in this changing world. He said national brand names like


(CLX) - Get Report



(CL) - Get Report


Procter & Gamble

(PG) - Get Report

may have nice dividends, but they're simply not as attractive an investment as they once were.

Cramer recommended


(PRGO) - Get Report

as one company that does work in this new world. Perrigo currently commands 70% market share in the over-the-counter generic drug market, and with companies like

Johnson & Johnson

(JNJ) - Get Report

struggling with multiple recalls, Perrigo products are often the only options on the shelf.

Shares of Perrigo are up 80% since Cramer first recommended it on Feb 9, 2010, but he said the Perrigo story is still compelling as the stock is now eight points off its 52-week high and the company continues to grow through acquisitions.

Also on the buy list,

Treehouse Foods

(THS) - Get Report

, makers of most things generic in the grocery aisle. Treehouse posted a disappointing quarter, missing estimates by seven cents a share, but Cramer noted that the miss was largely due to transportation costs associated with $4 a gallon gasoline and not the company's core business. Treehouse will benefit from the retreat in oil prices as well as its continued trend of taking market share.

Cramer said consumers don't want to pay up for brand names anymore and investors shouldn't either. He said Perrigo and Treehouse make great additions to any portfolio.

Long-Term Themes

On horrible days like today, Cramer said investors need long-term themes they can latch onto. He said cyber security, the need to protect online data, is one of them. With the slew of recent attacks on companies from


(SNE) - Get Report



(C) - Get Report

to the U.S. Senate, cyber security is once again front and center.

Cramer said he's had success in this area before, noting recommendations of Arcsight and

L1 Identity Solutions

( ID), which were up 90% and 75% respectively, with Arcsight receiving a takeover bid.

Cramer added two new companies to his cyber security list, including


(FTNT) - Get Report

, makers of a unified threat management system that saves companies time and money over using multiple vendors for anti-virus and anti-spam software, as well as firewalls, Web filtering and data loss management. Cramer said Fortinet is expensive, trading at 55 times next year's earnings, but under $21 a share, he'd be a buyer.

Also making the list, the speculative



, a company transitioning away from its Web-filtering legacy business and into cyber security for the cloud. Websense has already caught the eye of

(CRM) - Get Report

, the leading cloud purveyor, and has lots more upside. Websense trades at just 14.5 times earnings and has a 13% long-term growth rate.

Am I Diversified?

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


(T) - Get Report


General Motors

(GM) - Get Report



(AA) - Get Report


Monster Worldwide



Health Management Associates



Cramer said this portfolio had nice diversification.

The second caller's top holdings included

F5 Networks

(FFIV) - Get Report





(CRM) - Get Report


Western Refining




(BIDU) - Get Report


Cramer said this portfolio was too speculative and had too much technology exposure.

The third caller had




Yamana Gold

(AUY) - Get Report


Chesapeake Energy

(CHK) - Get Report



(WY) - Get Report



(INTC) - Get Report

as the top five stocks.

Cramer said this portfolio was perfectly diversified.

Lightning Round

Cramer was bullish on

Peabody Energy

(BTU) - Get Report


Stonemor Partners

(STON) - Get Report


Vodafone Group

(VOD) - Get Report



(MCD) - Get Report


He was bearish on

Aruba Networks



Sina Corp

(SINA) - Get Report


American Capital Agency

(AGNC) - Get Report


Closing Comments

In his "No Huddle Offense" segment, Cramer said he's bullish on today's $4 drop in crude oil. He said while a drop in oil cause by falling demand would be bad, this drop in oil is likely being caused by increased supply that is helping to flush out some of the speculators who are buying futures with borrowed money.

Cramer said that $3.50 gasoline is desperately needed for our economy to rebound, but how we get there matters. Lower oil prices saved us in 2008, he noted, and it can work for us again.

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

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Scott Rutt


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At the time of publication, Cramer was not long any equities mentioned.

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."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, 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, 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 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, 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.