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Jim Cramer donned his doctor's lab coat on Wednesday's edition of his "Mad Money" TV show to help investors diagnose the markets as well as individual stocks.
While every stock was assumed to be in critical condition last year, many of those diagnoses were wrong, he said.
Cramer said investors need to think like a good doctor and examine each sector, determine what ails it, and decide what the prescription for recovery will be. He said not everything in the economy should be on life support and not everything is in recession.
When it comes to the industrial stocks, the transports, retailers and oil stocks, these companies were diagnosed with terminal illnesses last year, and rightfully so, he said. As the economy softened, so too did these companies. But he said many of them will survive and recover as will the economy.
In technology however, Cramer said many companies were misdiagnosed, and many were never sick at all. Due to strong product cycles, companies like
should never have been admitted to the hospital, he said.
Other "patients" are harder to diagnose such as the natural resource companies. He said these stocks have been pumped up on speculative steroids, making it difficult to if they're sick or not.
While others such as the banks truly are in critical condition,
, two stocks which Cramer owns for his charitable trust,
Action Alerts PLUS, are on solid ground, he said.
Cramer said his bottom line was that not every stock is sick and should be treated as if it's dying.
Wiring Money Home
There is a stock that can benefit from Obama's political agenda, said Cramer, and it's
He said President Obama's plans to overhaul immigration in this country, along with the hopes of a global recovery, spells profits for this well-run leader of money transfers.
Cramer expects Obama's reforms to go easy on illegal immigration, which should translate into a big boost for Western Union. Likewise, as the economy recovers, both here and abroad, remittances through Western Union should also increase.
Finally, Cramer said the near collapse of competitor
will also allow Western Union to further secure it's position as the premier player.
Cramer said Western Union's last quarter was only slightly better than expected, but noted that the company affirmed its fiscal 2009 guidance. He said now is the perfect time in the cycle to establish a position, as wiring money home is a necessity and not a luxury for many families.
Banning Ultra-Leveraged ETFs
In his "Eureka Moment!" segment, Cramer shouted "bravo!" to the brokerage of Edward Jones & Co. for their decision to stop selling ultra-leveraged ETFs to their clients. Cramer, a long time critic of ultra levered ETFs, said he hopes every brokerage takes a stand and follows in Edward Jones' footsteps.
Cramer reminded viewers that these ultra-leverageed funds do not do what they advertise and are designed for day traders to bypass margin requirements and beat down stocks with incredible potency.
He said that for most retail investors, these funds lose money, and at the heart of the financial crisis, cost the American taxpayers billions, as the government stepped in to bailout firms as their stocks faltered under the assaults from theses funds.
Cramer applauded Edward Jones, and again pleaded to regulators and brokers alike, to do the right thing and ban these funds.
Am I Diversified?
Cramer talked with callers about their portfolios. The first caller's portfolio included
American Capital Agency
Bank Of America
Cramer said this portfolio was too weighted to real estate with Bank of America and American Capital Agency and recommended adding a healthcare company.
The second caller's top holdings included
Cramer said this portfolio was too weighted to the Internet. He recommended selling Google in favor of a financial company.
The third caller had
Precision Drilling Trust
as their top five stocks.
Cramer said this portfolio needed a healthcare stock to take the place of one of the oil names.
In the Lightning Round, Cramer was bullish on
He was bearish on
Coeur d'Alene Mines
Check out the latest edition of
"Cramer's Take onTop-Searched Stocks" on Stockpickr.
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At the time of publication, Cramer was long Goldman Sachs, JPMorgan Chase, China Unicom.
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."
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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.