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"We must be nimble, but money can still be made," a subdued Jim Cramer told viewers of his "Mad Money" TV show Friday.
In an environment where finding a bull is getting tougher and tougher, it's more important than ever to have the right stocks, he said.
Cramer said in times like these, it's tempting to ask "why bother?" He said in the short term, it might seem like it makes sense to buy bonds, keep your money in cash or just short the entire market.
But, he said, in the long term, investors can't afford to miss the recovery when stocks do finally turn around.
Cramer again advocated a diversified portfolio of defensive stocks, along with some cash and gold. However, he stressed the importance of having the right defensive stocks.
Not all defensive names are created equal, said Cramer. Names like
Procter & Gamble
, may sound defensive, but in times of fierce competition, investors need to stick with the winners.
He recommended names like
, a stock which he owns for his charitable trust,
, along with private label food makers like
( RAH) and
In uncertain political times, Cramer said he would stay clear of the other kind of defensive stocks, mainly
Cramer admitted the markets are, and will be, miserable. But when the smoke clears, he said, he will continue to find the bulls.
For "Speculation Friday," Cramer recommended
( ALTH), a small $5.64 a share biotech.
Cramer said Allos
has everything he wants in a speculative stock
: It's cheap, it's not a bank stock, it's not an insurance stock, and it's got a hot new drug headed to FDA approval.
is developing what's known as an orphan drug
that treats rare conditions that affect only a few thousand patients, but also one that has absolutely no competition.
Allos' blood cancer drug
is seeing positive phase two testing results and could be approved by the FDA as early as the end of this year. The company also has $90 million in cash, enough to carry it through approval.
Cramer said he's also not worried about the Obama effect on
, since orphan drugs with no competition rarely see political pricing pressures.
Cramer warned that Allos is a speculative name with no sales to speak of, and while he sees a bargin at $6 or less, he would not pay up for the stock.
A China Play
After President Obama wrecked the healthcare stocks and proposed big tax increases on the oil stocks this week, Cramer told viewers they need to Obama-proof their portfolios. He recommended once again looking overseas, to recession resistant companies outside of the president's taxable teach.
Cramer said Australian mining giant
fits the mold, with it's juicy 4.5% dividend yield.
Cramer said BHP is simply a play on the recovery in China. With the price of iron up 25% since October and 20% of BHP's sales coming from China, Cramer said the connection should be obvious.
Shares of BHP have fallen from a high of $95 a share all the way down to just $36 today. Cramer said the company has a strong balance sheet, with more than enough free cash flow to cover its dividend payments. The company is also taking market share, making it the perfect way to play the Chinese recovery.
Cramer told a viewer that he's not worried about the oil reserves of
Permian Basin Royalty Trust
, because the company is always finding more oil. But he advised not paying up for the stock, given the stock's 20% pop on yesterday's recommendation.
When a second viewer expressed concerns over
, Cramer said he also is concerned and is keeping a close eye on the situation, but feels the dividend ultimately will be OK.
Another viewer asked Cramer whether the
SDPR Gold Shares
is big enough to manipulate the price of gold.
Cramer said frankly, yes. He said that while 60% of gold is used for jewelry, much of the remaining 40% goes to stock the Gold Shares. But, he said, with gold coming down in recent weeks, he thinks that risk is now minimal.
Cramer was bullish on
Air Products and Chemicals
Papa Johns Internationa
He was bearish on
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At the time of publication, Cramer was long Wal-Mart.
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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