Cramer's 'Mad Money' Recap: March 2

This article was originally published March 2

Click here for an archive of Jim Cramer's Mad Money recaps.


"A broken stock market is a huge problem," Jim Cramer cautioned viewers of his "Mad Money" TV show Monday.

Cramer said he wished he could come out and say something positive on tonight's show. Instead, he cautiously said the stock market simply can't afford Obama's agenda.

Cramer said until Obama starts paying attention to the stock market or gives some sign that he realizes everything is falling apart, the markets will continue to act like a slow motion accident that won't stop until stocks reach absurdly low levels.

Cramer acknowledged that for a new president, changing the world might seem irresistible, but he said simply that Obama needs to put his whole agenda on hold, for now, until things can stabilize. He said it's not just the banks that are getting pushed down by Obama's policies, now the oil stocks, along with health care, are also in free fall.

"What's good for stocks is not always good for America," said Cramer. "But for now, it sure is," he continued.

He said that stability matters, and that stability has all but vanished from markets. He warned that if Obama continues his assault on the markets, the Dow Jones Industrial Average could see 4,000, a level not seen since 1994.

Cramer said the world was a different place in 1994. Back in 1994, he said, there was a new world order with the spread of capitalism around the world, cell phones were spreading to the masses, the Internet was just bursting onto the scene, and the public discovered stocks as they began to manage their own 401Ks and IRAs. Today, however, there is none of that.

Cramer said he's never felt this total lack of control in the markets before. The president's agenda is just destroying the markets, he said.

A Dividend Play

Cramer said investors looking to put money directly in their pockets need to buy some Pepsi ( PEP), a stock which he owns for his charitable trust, Action Alerts PLUS, before close of business tomorrow.

Cramer explained that Pepsi is paying out its quarterly dividend of 42.5 cents a share on March 30, but in order to qualify for that payment, investors need to own the stock Tuesday.

He said that while Wall Street makes it difficult to understand dividends, the "must-own" date, the date investors need to have shares in order to get the dividend, is simply three days prior to the announced "date or record," or one day prior to the "ex date."

Cramer further explained that investors need only hold shares for one day to qualify for a dividend, but cautioned that shares on the day after the "must-have" date will likely trade 42.5 cents lower to compensate for the dividend payment. That's why he recommends holding onto Pepsi for the longer term.

Cramer said Pepsi is a growth story, with a 37-year history of consecutive dividend raises and 11% growth in the company's international revenue. He said the company is also a play on the recovery in China, a country where Pepsi continues to expand.

Cramer said Pepsi is a second half of 2009 story, as the company, which is seeing falling costs for raw materials, continues to post strong sales compared to last year. He said while the U.S. economy, along with a stronger dollar, are concerns, that news is already priced into the stock, which is down significantly.

BankingMyWay

Count on Edison

Investors looking to "Obama-proof" their portfolios need to own Edison International ( EIX), a utility that may escape the wrath of the president's new cap-and-trade initiative.

Cramer said that while utilities are supposed to be safe havens during times of recession, Obama's new cap-and-trade policies essentially puts a tax on anyone who burns coal and will cripple that whole sector. The utilities are also suffering from financing concerns, he said.

But Cramer said Edison is bucking these trends, as it derives 42% of its power from nuclear plants, 22% from renewable hydro-electric plants and 23% from cleaner burning natural gas fired plants. The company also sports a strong balance sheet, a safe 4.9% dividend yield and is investing $880 million in new solar initiatives.

Edison recently reported earnings of 66 cents a share, beating estimates by 2 cents. Cramer said he'd be a buyer of Edison right here, but advised buying in stages as the market continues to decline.

Outrage of the Day

Cramer continued his barrage of criticism for Treasury Secretary Tim Geithner, this time for his handling of the Citigroup ( C) bailout.

Cramer said he cannot understand why the government will not consider the forbearance plan he's been preaching for weeks, one that will give the banks both time to breathe and the ability to work out many of their problems on their own, without destroying the stockholders or saddling the taxpayers in the process.

Cramer said Geithner's handling of Citigroup now puts other banks at risk. He said Bank of America ( BAC), US Bancorp ( USB) and even Cramer favorite Wells Fargo ( WFC) could be next on Geithner's chopping block.

Cramer said Geithner needs to stop listening to reporters who are telling him that the government must act immediately and that the public won't stand for helping the banks. "Why punish the shareholders when there are other options?"

Lightning Round

Round, Cramer found nothing to be bullish about but he was bearish on Taiwan Semiconductor Manufacturing ( TSM), Eli Lilly ( LLY), Autodesk ( ADSK)and Tenaris ( TS).

Check out the latest edition of "Cramer's Take onTop-Searched Stocks" on Stockpickr.

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Read more of Cramer's Mad Money Lightning Round insights.

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At the time of publication, Cramer was long Pepsi.

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."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com 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 TheStreet.com, 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 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.

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