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) -- It's becoming increasingly apparent there will be no federal budget deal by January, Jim Cramer told

"Mad Money"

viewers Wednesday.

So if the nation falls off the proverbial fiscal cliff, investors need to be ready with a game plan.

Cramer said compromise appears to still be the enemy in Washington, with several congressmen digging in their heels and sticking to their previous vows to never raise taxes, no matter how desperately they may be needed.

He said the current scenario feels much like the passage of the Troubled Asset Relief Program, or TARP, a few years ago, where politicians only got on board with the plan after the market fell by 10% and they realized just how bad things would become.

Cramer predicted the markets will see their first leg lower during the last week of the year as nervous investors liquidate positions ahead of the new tax rules. Afterward, Cramer said, we're likely to see further declines every Thursday as jobless claims begin to rise.

So how can investors protect themselves? Cramer said all stocks will feel the pain of the cliff, but those that will recover first will be those with the biggest gains before the cliff.

He said the housing recovery will continue on, which means stocks like

Home Depot

(HD) - Get Home Depot, Inc. (HD) Report



(SHW) - Get Sherwin-Williams Company Report



(WHR) - Get Whirlpool Corporation (WHR) Report

will bounce first, as will the high-yielders like


(T) - Get AT&T Inc. Report



(VZ) - Get Verizon Communications Inc. Report


Be ready to scamper out of the abyss, Cramer concluded, because after the markets fall by 10% or more, these stocks will be the ones to help us recover.

What the Heck?

In his "What The Heck?" segment, Cramer turned the spotlight on

Trimble Navigation

(TRMB) - Get Trimble Inc. Report

, a once-left-for-dead global-positioning company that is now flirting with its 52-week highs and is up over 18% in just the past 30 days.

Cramer said he was amazed at what he found when looking into Trimble because the company is no longer just making commodity GPS sensors like everyone else.

Trimble got smart, said Cramer, and evolved into communications, which then led to data modeling and analytics and finally gave the company an entire suite of software tools to help those in construction and other industries run their operations more effectively.

Trimble has now entered into a joint venture with


(CAT) - Get Caterpillar Inc. Report

and its machine control technology is being sold right alongside CAT's biggest equipment. This gives Trimble a competitive edge, noted Cramer, in an industry where there is still plenty of room to grow.

Trimble last delivered an earnings beat of 6 cents a share on better than expected revenue. Shares currently are going for 17.8 times earnings and the company has an 18.3% growth rate.

Cramer said as the number of users of Trimble's installed equipment grows, the company will soon be able to offer software upgrades and improvements, which can only further improve its margins.

Buying Into Kroger

Some sectors are loathed no matter what the economy is doing, Cramer told viewers. For almost the entire duration of "Mad Money," Cramer has panned both the airlines and the supermarkets, with the sole exception of

Whole Foods Market


, which remains a Cramer fave.

But even in the supermarket business, one where the margins are razor-thin and the competition is intense, Cramer said execution matters, which is why shares of


(KR) - Get Kroger Co. (KR) Report

are up 3% for the year while






have fallen 64% and 19%, respectively.

Cramer said Kroger is doing things right and is doing a better job of appealing to value-oriented customers at its 2,425 locations. Kroger is the only grocer to post returns above its cost of capital and the company's same-store sales were up 3.6%. Kroger is also seeing its margins increasing as its taking share from its competitors.

Kroger is the second-largest grocery chain, a fact that's helped both its balance sheet and its ability to grow and expand, said Cramer. The company also sells gasoline at about 50% of its locations, which helps attract customers and keep them.

But perhaps Kroger's biggest advantage is its large penetration of private-label products. Private-label items carry higher margins than branded ones, Cramer reminded viewers, which is helping the company stay afloat in a highly competitive landscape.

Cramer told viewers to avoid buying Kroger ahead of its upcoming results, but as a longer-term stock he said this is one grocery store, along with Whole Foods, that can actually be bought.

Lightning Round

In the Lightning Round, Cramer was bullish on

Clean Energy Fuels

(CLNE) - Get Clean Energy Fuels Corp. Report



(SBUX) - Get Starbucks Corporation Report


Red Hat

(RHT) - Get Red Hat, Inc. Report


Cramer was bearish on

(BIDU) - Get Baidu, Inc. Sponsored ADR Class A Report





BP Prudhoe Bay Royalty Trust

(BPT) - Get BP Prudhoe Bay Royalty Trust Report


Am I Diversified?

In the "Am I Diversified?" segment, Cramer spoke with callers and responded to tweets sent via Twitter to


to see if investors' portfolios have what it takes for today's markets.

The first portfolio included:


(BP) - Get BP p.l.c. Sponsored ADR Report



(PEP) - Get PepsiCo, Inc. Report

TheStreet Recommends



(AAPL) - Get Apple Inc. (AAPL) Report


Bank Of Nova Scotia




(WIN) - Get Windstream Holdings, Inc. Report


Cramer said this portfolio was great for diversification but he was not a fan of some of the individual choices.

The second portfolio's top holdings included:

Chesapeake Energy

(CHK) - Get Chesapeake Energy Corporation Report



(EXC) - Get Exelon Corporation Report



(NOK) - Get Nokia Oyj Sponsored ADR Report



(F) - Get Ford Motor Company Report


Sprint Nextel

(S) - Get SENTINELONE, INC. Report


Cramer said Nokia and Sprint are both telecoms and he would swap Nokia for Apple.

The third portfolio had:

Bristol-Myers Squibb

(BMY) - Get Bristol-Myers Squibb Company Report


National Oilwell Varco

(NOV) - Get National Oilwell Varco, Inc. (NOV) Report


EZChip Semiconductor




(SBUX) - Get Starbucks Corporation Report


Westport Innovations

(WPRT) - Get Westport Fuel Systems, Inc. Report

as its top five stocks.

Cramer said this portfolio was fabulous just as it was.

The fourth portfolio's top stocks were:

Bank of America

(BAC) - Get Bank of America Corp Report


American International Group

(AIG) - Get American International Group, Inc. Report



(COP) - Get ConocoPhillips Report





Western Union

(WU) - Get Western Union Company Report


Cramer said this portfolio was too concentrated in financials and advised selling Western Union and Bank of America and adding Apple and Bristol-Myers Squibb.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer explained the significance of


(CAG) - Get Conagra Brands, Inc. Report

Tuesday announcement it is buying private-label food maker


( RAH).

Cramer said that for a long time nationally branded items ruled the roost. But in this past recession many of these brands lost some of their appeal. He said private-label items, which once came in simple black-and-white cans and were only sold in low-end stores, became the bread and butter of retailers such as


(COST) - Get Costco Wholesale Corporation Report


With their new hip packaging and better formulations, private-label goods are now in some ways even better than their branded competition.

As the divide between rich and poor becomes ever larger, Cramer said the move towards private label also becomes larger, an irreversible trend that ConAgra saw and capitalized on.

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

To email Scott about this article, click here:

Scott Rutt

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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, AIG, BMY, CAT and SBUX.

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.