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Jim Cramer said that 708 new highs on Tuesday can't be wrong. That's how many stocks hit new 52-week highs today.

"And this is just the start," he told viewers of his "Mad Money" show on



Indeed, he said that unusual groups are co-existing in this market -- oil, retail, technology, etc. "The unusual confluence should be celebrated," he said.

Meanwhile, Cramer cautioned viewers not to fall in love with pretty faces on Wall Street. Hollywood stocks like




Warner Music Group

( WMG) are examples, Cramer said, of companies that put on a pretty or hip face but don't have anything inside. There is more than just an exterior, Cramer said. There has to be something on the inside. And that's called the fundamentals.

Fact is, investors who fell in love with stocks such as DreamWorks and Warner Music had nothing to fall back on when parts of their businesses started to fall apart.

The takeaway, then, is that you want to own a stock with something on the inside. That's why you want to own technology stocks, Cramer said. You want to own tech names such as


(MSFT) - Get Report


Cisco Systems

(CSCO) - Get Report



( MOT),

LSI Logic

(LSI) - Get Report


Skyworks Solutions

(SWKS) - Get Report



(GLW) - Get Report


You buy these, Cramer said, because the fundamentals are solid. To reiterate: Buying stocks because they are hip does not make you money. You should like stocks for real reasons, Cramer said. "Look past the shallow surface to see what works."

A caller asked Cramer if it's time to sell the large media stocks and buy the more specialized firms. Cramer said that the big media companies --

Time Warner







(DIS) - Get Report

-- are hard luck stocks right now, but investors should stick with them.

As for the drug stocks, especially the companies that are providing cancer drugs, Cramer said that you don't get scared of them until the HMOs stop paying for the drugs. The HMOs, Cramer said, might eventually stop paying for the drugs, but probably not anytime soon. As a result, he said that investors should not be afraid of high drug prices. As such, stay with stocks such as


( DNA) and


(NVS) - Get Report


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Cramer also spoke with Susan Demond-Hellmann, president of product development at Genentech. She outlined the company's prospects, and Cramer said that at $85 a share, Genentech is still a bargain and he would be a buyer here.

Finally, markets commentator Herb Greenberg said he is keeping his eye on

Urban Outfitters

(URBN) - Get Report

, a company he recently wrote negatively about. It's currently on his yellow flag list -- a stock to watch, Greenberg said.

Greenberg also said that he continues to think that investors need to be careful with

Marvel Enterprises

( MVL).

Cramer said that he wouldn't sell either of them, despite Greenberg's caution. As long as they are yellow-flag stocks, Cramer said that he's not a seller. There's no reason to take any action on either stock, Cramer said.

Cramer treated viewers to two Lightning Rounds on Tuesday night.

Lightning Round 1: Bullish

In the first round he was bullish on:

First Marblehead


DayStar Technologies




( SEPR),

McCormick & Co.

(MKC) - Get Report




Marvell Technology

(MRVL) - Get Report


Oceaneering International

(OII) - Get Report


ITT Educational Services

(ESI) - Get Report


Healthcare Services Group

(HCSG) - Get Report


Titanium Metals







(GME) - Get Report


Amylin Pharmaceuticals

( AMLN),


(ADSK) - Get Report



(ADBE) - Get Report


Fortune Brands

( FO),

Cytec Industries



Automatic Data Processing

(ADP) - Get Report



( SGP),

Abbott Laboratories

(ABT) - Get Report


Johnson & Johnson

(JNJ) - Get Report


Intuitive Surgical

(ISRG) - Get Report


Michaels Stores

(MIK) - Get Report


Dick's Sporting Goods

(DKS) - Get Report


Research In Motion

( RIMM),




Annaly Mortgage

(NLY) - Get Report



He was bearish on:

International Flavors & Fragrances

(IFF) - Get Report

TheStreet Recommends


Charles River Labs

(CRL) - Get Report


Doral Financial




( TRDO),

Coffee Holding

(JVA) - Get Report


Aastrom Biosciences



Credit Suisse Group

( CSR),

ADC Telecommunications

( ADCT),


(LB) - Get Report


Alaska Communications

(ALSK) - Get Report


Taser International



J.P. Morgan Chase

(JPM) - Get Report


Bottomline Technologies

(EPAY) - Get Report


Taro Pharmaceutical

(TARO) - Get Report


Arizona Land Income

( AZL).

During the second Lightning Round, Cramer was bullish on:

Lightning Round 2: Bullish


( TUNE),


(BA) - Get Report


Microchip Technology

(MCHP) - Get Report



(SONO) - Get Report



(C) - Get Report


Cimarex Energy

(XEC) - Get Report


Lucent Technologies

( LU),


(MU) - Get Report


Serena Software



People's Bank

(PBCT) - Get Report


Shuffle Master



Commerce Bancorp

(CBH) - Get Report


Given Imaging



Syneron Medical



Burlington Resources

(BR) - Get Report



Cramer was bearish on:





( IDR),

Corinthian Colleges




( ARXX),

Tibco Software



(OSTK) - Get Report


U.S. Steel

(X) - Get Report


Global Crossing

( GLBC),

Exxon Mobil

(XOM) - Get Report


Cell Genesys

( CEGE),

Vineyard National Bancorp

( VNBC),

Bank of America

(BAC) - Get Report



(FLEX) - Get Report



( CLZR),


( LSCP),





(FDX) - Get Report


Interested in more Cramer? Check out Jim's rules and commandments for investing from his latest book by

clicking here

. It's a series of articles from Cramer on how to become a better investor. The following table lists some of the rules that Cramer dissects.

At the time of publication, Cramer was long Boeing, Cimarex, Commerce Bancorp, GameStop, J.P. Morgan Chase, Lucent and Motorola.

James J. Cramer is a director and co-founder of He contributes daily market commentary for's sites and serves as an adviser to the company's CEO. Outside contributing columnists for and, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

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