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RealMoney Radio Recap: Remove the Staples

Cramer urges listeners to get into consumer-spending plays. Also, housing has not bottomed.

Everything's looking up in the market except for one thing:

Pepsi

(PEP) - Get PepsiCo, Inc. Report

, said Jim Cramer on his

"RealMoney" radio show Thursday.

He stressed that it's time to get out of staples such as Pepsi,

Coca-Cola

(KO) - Get Coca-Cola Company Report

,

Kellogg

(K) - Get Kellogg Company Report

,

Colgate

(CL) - Get Colgate-Palmolive Company Report

Clorox

(CLX) - Get Clorox Company Report

TheStreet Recommends

and

Procter & Gamble

(PG) - Get Procter & Gamble Company Report

and focus on consumer-spending plays such as

Best Buy

(BBY) - Get Best Buy Co., Inc. Report

,

Corning

(GLW) - Get Corning Inc Report

,

United Airlines

(UAUA)

,

CSX

(CSX) - Get CSX Corporation Report

,

Lowe's

(LOW) - Get Lowe's Companies, Inc. Report

,

Yum! Brands

(YUM) - Get Yum! Brands, Inc. Report

,

McDonald's

(MCD) - Get McDonald's Corporation Report

and

Wendy's

(WEN) - Get Wendy's Company Report

.

Cramer also recommends

Au Optronics

(AUO)

, which he says is undervalued, and

Sears

(SHLD)

, which he owns for his charitable trust,

Action Alerts PLUS.

"You gotta make that switch," Cramer said.

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He also recommends financials and drugs. "Biotech seems to be peaking," Cramer said, though he believes that

Genentech

(DNA)

is going higher, despite its losing momentum.

Cramer added that

Merck

(MRK) - Get Merck & Co., Inc. Report

and

Pfizer

(PFE) - Get Pfizer Inc. Report

are also losing momentum, but that things are looking even brighter for

Johnson & Johnson

(JNJ) - Get Johnson & Johnson Report

, which he also owns for his charitable trust, since its purchase of Pfizer's consumer-business segment.

Heckled on Housing

"There are two reasons why housing gets bought: lower interest rates and lower prices," said Cramer.

And both are true now. "This is not genius," he said. "It's the way every business cycle works."

Stocks such as

Lennar

(LEN) - Get Lennar Corporation Class A Report

and

Centex

(CTX)

bottomed out in July after analysts downgraded them as a group, but they've come back up.

Cramer said he's been getting feedback from hedge fund managers and their minions that he's dead wrong on housing. But those folks just want to bring stock prices down so they can buy, Cramer said. "Housing stocks have spoken."

Different industries are driven by different things, Cramer said, like interest rates, consumer spending, agriculture cycles and airline trends. Cramer recommends

Deere

(DE) - Get Deere & Company Report

and

United Airlines

.

But with oil prices going lower, Cramer recommends getting out of tanker stocks and getting into defense companies such as

General Dynamics

(GD) - Get General Dynamics Corporation Report

.

"This is absolutely the right time to buy tech, because tech is on sale today," said Cramer.

Tech is down today because of options-expensing problems, which makes it a good time to buy stocks such as

Apple Computer

(AAPL) - Get Apple Inc. Report

, he said.

Cramer's Callers

"When restaurants do well,

Sysco

(SYY) - Get Sysco Corporation Report

does well," said Cramer.

Sysco brings food to restaurants, and with consumer spending strong, "what could be a better business now that restaurant business is booming?" he asked one caller.

Cramer said he wouldn't recommend the stock, however, citing Sysco's price-to-earnings multiple of 24.

"

MetLife

(MET) - Get MetLife, Inc. Report

is for me," Cramer told another caller who asked what he saw in the company's future. Cramer has been calling MetLife a "best-of-breed" insurance company and iterates that the stock is "terrific."

"

Automatic Data Processing

(ADP) - Get Automatic Data Processing, Inc. Report

is right," he said to another caller. Though Cramer adds that the stock is only up 1% for the year, he believes that it's still a good opportunity.

ADP "feels the heat," but it's doing a lot of things right. "Please hold onto it," Cramer said.

People had high hopes for

Shaw Group

(SGR)

, which has been a "serial disappointment," Cramer said.

But the whole infrastructure group is finally making a comeback, and Cramer wants to be there. He sees Shaw Group, which is trading at around $28, going up to $30 to $31.

Ingersoll Rand

(IR) - Get Ingersoll Rand Inc. Report

, which Cramer owns for his charitable trust,

Action Alerts PLUS, and is trading at around $40, "makes too much sense," he said.

Cramer also recommends

Caterpillar

(CAT) - Get Caterpillar Inc. Report

and

Cummins

(CMI) - Get Cummins Inc. Report

.

At the time of publication, Cramer was long Johnson & Johnson, Ingersoll Rand and Sears Holdings.

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

Action Alerts PLUS. Listen to Cramer's RealMoney Radio show on your computer; just click

here. Watch Cramer on "Mad Money" at 6 p.m. ET weeknights on CNBC. Click

here to order Cramer's latest book, "Real Money: Sane Investing in an Insane World," click

here to get his second book, "You Got Screwed!" and click

here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by

clicking here.

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