Search Jim Cramer's Mad Money trading recommendations using ourexclusive Mad Money Stock Screener and watch Jim Cramer's Mad Money Post Game videoexclusively on TheStreet.com.
NEW YORK (
) -- "Things may seem tough now, but they're nothing compared to 2008," Jim Cramer told the viewers of his "Mad Money" TV show Tuesday, as he tried to put the current market woes into a little historical context. "This isn't the eve of destruction."
Cramer said with the events of the financial panic of 2008 so engrained in our minds, it may seem like every crisis needs to have a 6,000 drop in the Dow, but that's just not the case. The current crisis in Europe is not as dire as the U.S. crisis, where the entire financial system of the western world hung in the balance, he said.
Cramer said the markets have seen crises like Europe before. He recalled the the Asian and Russian crises from 1996 to 1998, and the savings and loan crisis from 1989 through 1991. In both cases, Cramer said there was money to be made in stocks like
While Cramer said caution is still warranted in this turbulent market, he said he doesn't expect a repeat of last year's bone-crushing market retreat to Dow 6,500. In fact, even his worst case collapse of Europe scenario only pegs the Dow at 8,260, he said. This may be a bad market, he said, but it's not terminal.
Chairman Ben Bernanke agrees, making comments this week that a double dip recession is unlikely. The reason? Cramer said it's because we've learned how not to fail. He said that Europe has the benefit of our experiences and won't repeat our mistakes.
"Don't let this market fool you," Cramer concluded, "this is not a repeat of 2008."
In the "Off The Charts" segment, Cramer went head to head with colleague Tim Collins over the chart of
Utilities Select Sector SPDR
. Cramer said historically, utilities are the sector investors flock to in times of uncertainty, but in this market, it's anyone's guess.
According to Collins, the daily chart of the XLU shows a classic sideways trading pattern that could soon turn positive. The relative strength index and the on-balance volume indicators both show upward trends, signs that it's time to buy.
However the weekly chart of the same ETF paints a much less bullish picture. On the weekly chart, both the relative strength and on balance volume confirm a bearish pattern.
So with the charts giving mixed readings, Cramer said investors should turn to the fundamentals, and stick with the names they have the most conviction in. He said previously he recommended
. However he said both stocks have run up, leaving room for a new favorite.
, with its 7% yield, is now the new utility favorite. He said the company is divesting its other businesses to focus on its core transmission and distribution business, which gives the company not only the ability to raise rates, but also affords it a 10% long-term growth rate.
Cramer said while Pepco trades at a 15% premium to its peers, the company is cheap, given its growth.
India's Growing Middle Class
Continuing his series on macro-economic trends that can transcend government intervention, Cramer focused on the rising middle class in India. According to recent estimates, India could see 50 million to 300 million people added to its middle class by 2025. India is also poised to become the 5th largest consumer market also by 2025. "This trend is massive," said Cramer.
Tapping into the Indian market however, is difficult. Of the 14 Indian ADRs that trade here in the U.S., Cramer said all of them are in the technology outsourcing or wireline communications business, two industries he doesn't recommend.
So how to play the Indian trend? Cramer said one way is with
, the second largest private sector bank in the country. He said ICICI is cutting costs, cleaning up its balance sheet and is rapidly expanding its branches to a wider and wider footprint.
Cramer said another way to play India is with infrastructure. Here he recommended a new ETF set to trading under the ticker INXX in the coming weeks. He said this new ETF will invest in 30 Indian infrastructure companies including gas companies and utilities.
Finally, Cramer once again recommended
, which owns 67% of India's largest wireless provider. Cramer said with the arrival in July of the new iPhone from
, a stock, which he owns for his charitable trust,
Action Alerts PLUS, the growth potential for Vodaphone in India remains huge.
Looking Beyond the Gulf Disaster
In the "Executive Decision" segment, Cramer spoke with Bernard Duroc-Danner, chairman, president and CEO of
, a stock which Cramer owns for his charitable trust,
Action Alerts PLUS. The stock of Weatherford is down 26% since the Gulf oil spill despite having no exposure to the Gulf of Mexico.
Danner said that the spill in the Gulf has been a tragedy, both for those who lost their lives and for the environment. From an industry perspective however, Danner noted that the Gulf only represents 3% to 4% of all oil service investments. He said the spill will likely move capital out of the U.S. and into international markets, which in the long run is better for his company.
When asked about countries around the globe, Danner said that Mexico remains an opportunity for Weatherford, and the market is stabilizing and is waiting to be developed. Brazil, he noted, is ready to make huge leaps forward in its infrastructure, and will be a much larger player than it is. Finally, Danner said that Weatherford is well positioned to be a large player in Iraq.
When asked about the company's debt structure, Danner said that Weatherford puts a lot of planning into both the size and quality of its debt, and that he's comfortable with the company's current plans.
Cramer said he remains bullish on Weatherford, especially with its price having sunk so low.
Cramer was bullish on
New York Community Bancorp
He was bearish on
American Capital Agency
-- 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
For more of Cramer's insights during the Lightning Round, clickhere
At the time of publication, Cramer was long Apple, Weatherford International.
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.