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Caution should not be thrown to the wind when the Federal Reserve starts raising interest rates, Jim Cramer cautioned his Mad Money viewers Thursday. Or, as the old Marty Zweig quote put it, "Don't fight the Fed."
Cramer said when money costs more, making money in the stock market gets a little harder. And when tailwinds become headwinds, investors need to respond accordingly. He noted that between 2008 and 2014, when interest rates were at zero, the S&P 500 rallied 130%. But since the Fed's QE3 program ended in 2014 until now, the markets are up only 2.9%.
That doesn't mean that good stocks are hard to find. Since the Fed took its foot off the gas in 2014, Amazon.com (AMZN) - Get Amazon.com, Inc. Report is up 127%, with Netflix (NFLX) - Get Netflix, Inc. (NFLX) Report not far behind at 122%. Those gains are followed by Activision Blizzard (ATVI) - Get Activision Blizzard, Inc. Report , up 102%, and Electronic Arts (EA) - Get Electronic Arts Inc. Report , up 90%.
Others -- Agavo (AVGO) - Get Broadcom Inc. Report , the semiconductor company, and Expedia (EXPE) - Get Expedia Group, Inc. Report , the travel colossus -- also tacked on big gains during this time period.
Investors need to stay flexible and not be as aggressive as they have been, Cramer concluded. Above all else, don't let gains turn into losses because of greed.
Executive Decision: John McAvoy
For his "Executive Decision" segment, Cramer sat down with John McAvoy, chairman and CEO of Consolidated Edison (ED) - Get Consolidated Edison, Inc. Report , the utility provider to most of New York City and Westchester County in New York.
McAvoy said ConEd's earnings are not tied to the unseasonably warm weather but to the company's ability to make prudent capital investments over time. He said electricity usage is flat in the New York area thanks to energy efficiency initiatives, which are good for customers and the environment.
ConEd is expecting a 2.3% increase in natural gas usage as more homes and businesses convert from oil and coal to cleaner and cheaper natural gas. McAvoy said ConEd has wind and solar facilities outside of their service area.
When asked about the New York economy, McAvoy noted the region's diversity as one of its strengths. He said New York has great tourism, technology, education, hospitals and health care, all of which provide it with a strong base of activity.
McAvoy said ConEd's new advanced metering initiatives, which will place smart meters at customers' homes to allow for real-time monitor and outage detection as well as reduce overall load by 1%.
Cramer called ConEd a great growth and dividend story.
Cramer's Fab Four
As investors gear up for 2016, Cramer anointed his "fabulous four," four companies that seem poised to do exactly what they've already told us they would do next year.
Cramer explained there was nothing remarkable about the comments made by General Electric (GE) - Get General Electric Company (GE) Report , FedEx (FDX) - Get FedEx Corporation Report , CVS Health (CVS) - Get CVS Health Corporation Report and Honeywell (HON) - Get Honeywell International Inc. (HON) Report this week, except they all reaffirmed their guidance for 2016.
That may not seem like a lot. But in an economy with global pressures, falling commodities and rising interest rates, being autonomous enough to not cut your estimates is a real sign of strength, delivering for investors no matter what.
Executive Decision: David Jaffe
In his second "Executive Decision" segment, Cramer sat down with David Jaffe, president and CEO of Ascena Retail Group (ASNA) - Get Ascena Retail Group, Inc. Report , the specialty retailer that's seen its shares plunge 22% in 2015.
Jaffe said there's no doubt the warm weather throughout the country has affected sales of cold weather gear. He said customers can expect to see a lot of promotional activity on items like sweaters and scarves this year.
Going beyond this holiday season, Jaffe said customers have not really swung back to the apparel category since the recession ended, opting instead for electronics and other items.
That trend hasn't deterred Ascena, however. The company announced a $200 million stock buyback program. Jaffe said the acquisition of Ann Taylor will begin showing strong results this spring and the company is confident in the business.
In the Lightning Round, Cramer was bullish on SunTrust Banks (STI) - Get SunTrust Banks, Inc. Report , Dow Chemical (DOW) - Get Dow, Inc. Report , Cisco Systems (CSCO) - Get Cisco Systems, Inc. Report , Red Hat (RHT) - Get Red Hat, Inc. Report , Public Service Enterprise (PEG) - Get Public Service Enterprise Group Inc Report and CVR Refining (CVRR) .
Cramer was bearish on Groupon (GRPN) - Get Groupon, Inc. Report , Syngenta (SYT) , Performance Sports Group (PSG) , Polaris Industries (PII) - Get Polaris Inc. Report and Chesapeake Energy (CHK) - Get Chesapeake Energy Corporation Report .
Am I Diversified?
In the "Am I Diversified?" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets.
The first portfolio included Facebook (FB) - Get Facebook, Inc. Class A Report , AngloGold Ashanti (AU) - Get AngloGold Ashanti Limited Sponsored ADR Report , Skechers USA (SKX) - Get Skechers U.S.A., Inc. Class A Report , Apple (AAPL) - Get Apple Inc. (AAPL) Report and Allergan (AGN) - Get Allergan plc Report .
Cramer said this portfolio shouldn't have both Apple and Facebook, but in this case, he'll allow it.
The second portfolio's top holdings included Apple, Ford (F) - Get Ford Motor Company Report , Bank of America (BAC) - Get Bank of America Corp Report , Alphabet (GOOGL) - Get Alphabet Inc. Class A Report and General Electric (GE) - Get General Electric Company (GE) Report .
Cramer said Alphabet and Apple are also both tech names, but with Apple trading so low, he'll allow this combination as well for the time being.
The third portfolio had Apple, Nike (NKE) - Get NIKE, Inc. (NKE) Report , Visa (V) - Get Visa Inc. Class A Report , Walt Disney (DIS) - Get Walt Disney Company Report and WhiteWave Foods (WWAV) as its top five stocks.
Cramer blessed this portfolio as properly diversified.
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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, AGN, BAC, CSCO, DOW, FB, GOOGL and WWAV.