NEW YORK ( TheStreet) -- "Common sense prevailed today," Jim Cramer announced to the viewers of his "Mad Money" TV show Monday. He said the market has been in denial that commodity cost inflation has finally been broken, but today, it finally realized that lower commodities is good news for stocks. Cramer explained that ever since the crisis in 2008, the markets have been pounding consumer stocks and along with practically any stock that wasn't a producer of oil, metals or other commodities. As the price of commodities rose and inflation kicked in, the central banks of Brazil, India and China all began to raise interest rates to stop the run up. But with the release of 60 million barrels of oil from strategic reserves, Cramer said the ugly head of inflation has finally been beaten, sending the price of everything from copper to nickel to wheat and corn lower. Cramer said the problem is that here in the U.S., thanks to failed political policies since 2008, America hasn't seen this global trend. He said that the U.S. never had a building spurt caused by stimulus spending, nor did it see a rebound in housing. Thus here at home, our interest rates stayed at zero, which allowed U.S. stocks to head lower not on fundamentals, but on the bad news of other countries. But Cramer said all of that is changing now, as companies from Ford ( F) to General Mills ( GIS), DuPont ( DD) to Caterpillar ( CAT), a stock which he owns for his charitable trust,
Restaurants ReboundCramer said there are very few truisms on Wall Street, but one that still rings true is that when gas prices fall, the restaurants stocks do better. That's why he once again recommended Darden Restaurants ( DRI), purveyors of the Red Lobster and Olive Garden chains, among others. Cramer said Darden, with its model of 100% company-owned stores, is a screaming buy. He said while oil has declined 21% from its high, gasoline has only fallen 11% so far, leaving a lot more good news to come for the company. Cramer called Darden a high-quality company that cut costs to fight commodity inflation and one that now will see its bottom line jump higher as those costs decline. He said when the Darden reports on Thursday, investors need to look for the company's outlook and not trade the stock based on earnings. Cramer said the outlook is all that matters. Shares of Darden trade at just 12.7 times earnings, far lower than the industry average of 17 times earnings and even less than Darden's historical average of 13.1 times earnings. Cramer said with the estimates so low, now is a terrific time to get in on Darden. Also on the honorable mention list was Chipotle Mexican Grill ( CMG), which is trading at a 52-week high, despite having just pushed through price increases throughout the Northeast. Cramer said this purveyor of "food with integrity" is a great investment in the trend toward healthy eating and Chipotle's stock has a lot more room to run.
Dividend InequalityWhen it comes to tobacco stocks, Cramer said not all dividends are created equal. That's why he pinned all of the major players against one another to see if any of the tobacco names are still worth investing in. Cramer explained that new warning labels for cigarettes in the U.S. will only hasten the decline of an already embattled group. Cigarette consumption is declining by 3% to 4% annually in the U.S., leaving the only growth markets overseas. That's why Cramer said he'd only recommend Phillip Morris International ( PM), which pays a 3.9% dividend but has no exposure to the U.S. market. Cramer said that while smoking is in decline in the U.S., it's actually growing overseas, and with Phillip Morris gaining share in countries like China, this one stock is the only one where the dividend is safe. Cramer said that long-time favorite Altria ( MO) is still a well-run company and one that's diversified into smokeless tobacco and beer, but that still doesn't make up for being the best house in what is increasingly a bad neighborhood. Cramer has similar negative comments for Reynolds International ( RAI), Lorillard ( LO) and Vector Group ( VGR). Cramer said all of these stocks are primarily U.S.-based and while they pay higher dividends, those yields may not be sustainable for the long-term. He called the entire group "wasting assets."