NEW YORK ( TheStreet) -- "As stocks go lower, it makes less sense to sell them, Jim Cramer told viewers of his "Mad Money" TV show Wednesday as he opined on yet another abysmal day on Wall Street. Cramer said the market is getting too hated when compared to how companies are actually performing. Cramer said the markets are a self-correcting entity. He said fears and worries cause selling, but that selling will eventually end when either prices fall to a level when the bears are converted back into bulls or when there simply aren't any more bears left to sell. He said the markets may have not reach either of these levels yet, but stocks are among the cheapest Cramer's ever seen them. Cramer said investors need to keep in mind that stocks represent real companies with real values. And while the banks may be tied to the financial woes in Europe and the tech stocks may be in a seasonal slump, the rest of the market shouldn't be as low as it currently is. Cramer said only two companies, Scott's Miracle-Gro ( SMG) and Owens-Illinois ( OI), have reported actual disappointments this quarter. Everyone else is still doing OK. According to the latest investor sentiment numbers, nearly 63% of all investors are bearish on the markets or feel we're in a correction. That's a high number, he explained, which means that most of these bears either are selling or have already sold. That doesn't leave too much further to fall, he concluded.
Middle-Class SqueezeThe middle class in America is evaporating, Cramer told viewers. He said that time and time again companies have proven that high-end luxury items are doing well and low-end trade down plays are doing well, while everything in the middle is getting slowly squeezed out of existence. So with private label brands taking increasing share as consumers pinch pennies, Cramer said the private label companies might be the only safe bet in this changing world. He said national brand names like Clorox ( CLX), Colgate-Palmolive ( CL) and Procter & Gamble ( PG) may have nice dividends, but they're simply not as attractive an investment as they once were. Cramer recommended Perrigo ( PRGO) as one company that does work in this new world. Perrigo currently commands 70% market share in the over-the-counter generic drug market, and with companies like Johnson & Johnson ( JNJ) struggling with multiple recalls, Perrigo products are often the only options on the shelf. Shares of Perrigo are up 80% since Cramer first recommended it on Feb 9, 2010, but he said the Perrigo story is still compelling as the stock is now eight points off its 52-week high and the company continues to grow through acquisitions. Also on the buy list, Treehouse Foods ( THS), makers of most things generic in the grocery aisle. Treehouse posted a disappointing quarter, missing estimates by seven cents a share, but Cramer noted that the miss was largely due to transportation costs associated with $4 a gallon gasoline and not the company's core business. Treehouse will benefit from the retreat in oil prices as well as its continued trend of taking market share. Cramer said consumers don't want to pay up for brand names anymore and investors shouldn't either. He said Perrigo and Treehouse make great additions to any portfolio.
Long-Term ThemesOn horrible days like today, Cramer said investors need long-term themes they can latch onto. He said cyber security, the need to protect online data, is one of them. With the slew of recent attacks on companies from Sony ( SNE) to Citigroup ( C) to the U.S. Senate, cyber security is once again front and center. Cramer said he's had success in this area before, noting recommendations of Arcsight and L1 Identity Solutions ( ID), which were up 90% and 75% respectively, with Arcsight receiving a takeover bid. Cramer added two new companies to his cyber security list, including Fortinet ( FTNT), makers of a unified threat management system that saves companies time and money over using multiple vendors for anti-virus and anti-spam software, as well as firewalls, Web filtering and data loss management. Cramer said Fortinet is expensive, trading at 55 times next year's earnings, but under $21 a share, he'd be a buyer. Also making the list, the speculative Websense ( WBSN), a company transitioning away from its Web-filtering legacy business and into cyber security for the cloud. Websense has already caught the eye of Salesforce.com ( CRM), the leading cloud purveyor, and has lots more upside. Websense trades at just 14.5 times earnings and has a 13% long-term growth rate.