Cramer's 'Mad Money' Recap: Reality Check (Final)

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NEW YORK ( TheStreet) -- "All is not lost," Jim Cramer told the viewers of his "Mad Money" TV show Wednesday after a horrible day for the markets.

Cramer said while the markets keep going down on the same bad news that never seems to go away, much of that news investors should have seen coming.

"There's really nothing new," said Cramer, who noted that the markets have been fluctuating on a slowdown in China, a Japan that is on the mend, falling U.S. home prices, $104 a barrel oil, the Federal Reserve's QE2 program and a litany of other woes for months now. Yet despite all that turmoil, stocks are still just 4% from their highs for the year.

What should investors do on days like today? Cramer said they need to look at what they own and determine if their reasons for owning them have changed. He said while it remains a terrible time to own the banks and the seasonally slow tech stocks continue to struggle, that is not the case for all stocks.

Cramer said stocks like Caterpillar ( CAT), a stock which he owns for his charitable trust, Action Alerts PLUS, is still in control of its own destiny, for example. Other Action Alerts PLUS stocks like John Deere ( DE), Cummins ( CMI) and Apple ( AAPL) also remain on Cramer's buy list.

"What if the Chinese slowdown is temporary," asked Cramer? "What if Japan gets back online soon? What if the Greek fix is for real?" If any of this bad news changes, he ventured, days like today will take on a whole new meaning.

Rotational Moves

What's been driving certain sectors higher, but not others? Cramer went "Off The Charts" to find out.

Cramer said when you look at the charts of the medical device makers like CR Bard ( BCR), Baxter ( BAX) and Becton Dickinson ( BDX), you notice an interesting pattern. All three seem to have bottomed on March 15 and have been rallying ever since.

Cramer noted that the consumer staples, as evidenced by Colgate-Palmolive ( COL), Procter & Gamble ( PG) and Kimberly-Clark ( KMB), also show this pattern, as do the HMOs, the drug stocks and the tobacco names.

Cramer said it's clear that these are rotational moves into what are perceived to be "safe" sectors, but wondered why. It turns out the Japanese earthquake was the catalyst. Cramer said while many, himself included, expected Japan to recover quickly, the lingering nuclear crisis has kept that country essentially offline for months, making the earnings of these "safe" stocks irrelevant. Investors simply wanted safety, he said.

But Cramer noted that these same charts also show that the rally has come to an end, with just all off these names, sans tobacco, showing signs they've stalled or have topped out already. Cramer said as Japan turns from negative to positive, the reason to own these names may already be behind us.

"Bulls make money, bears make money, but pigs get slaughtered," Cramer reminded

Case for Google

Cramer said investors looking for a good value stock should take a look at Google ( GOOG). He said despite Google's $500 share price, and the fact that the stock has been trading horribly as of late, there is a lot to like about the king of search.

Cramer said his catalyst for Google was Yandex ( YNDX), the Russian search engine that saw shares rise 55% on its first day of trading. Cramer noted that while Yandex now trades at 60 times earnings, Google trades at just 15 times its earnings. Yandex also trades at 1.5 times its growth rate, while Google trades at less than one time its growth rate.

Cramer said Google is clearly the superior company when comparing the two, which makes its valuation absurd. He said while critics point to the fact that the company missed the social media revolution, has a new, young CEO, and is investing in projects that don't seem to be paying off, Google shouldn't be overly penalized.

Google has many new game changing projects in the pipe, and it remains the king of search with no real competition, he said, adding the company also has $36.7 billion in cash.

Am I Diversified?

Cramer spoke with callers to see if their portfolios have what it takes. The first caller's portfolio included Apple ( AAPL), Potash ( POT), iShares Gold Shares ( GLD), Kinder Morgan Energy Partners ( KMP) and Silver Wheaton ( SLW).

Cramer said Silver Wheaton trades right along side gold, so he recommended selling Silver Wheaton in favor of an industrial stock.

The second caller's top holdings included CenturyLink ( CTL), Boeing ( BA), Conoco-Phillips ( COP), Lowes ( LOW) and Stanley Black & Decker ( SWK).

Cramer said he would bless this portfolio as diversified.

The third caller had Netflix ( NFLX), Seagate ( STX), WeyerHaeuser ( WY), MGM Mirage ( MGM) and Leap Wireless ( LEAP) as their top five stocks.

Cramer said this portfolio was properly diversified.

Lightning Round

Cramer was bullish on Limelight Networks ( LLNW), Corn Products International ( CPO) and McDonald's ( MCD).

He was bearish on Petroleo Brasileiro ( PBR), Archer-Daniels-Midland ( ADM) and American International Group ( AIG).

Closing Comments

In his "No Huddle Offense" segment, Cramer once again made the case to own gold, whose rally is far from over.

Cramer called it a sin not to own gold, as it acts both as portfolio insurance and a currency. He said the SPDR Gold Shares ( GLD) remains his favorite way to play the move in gold. "Gold is an investment, not a trade," Cramer told viewers.

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

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At the time of publication, Cramer was long Caterpillar.

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.

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