Cramer's 'Mad Money' Recap: The Bears Are Wrong

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NEW YORK ( TheStreet) -- The bears may sound smart, but Jim Cramer told his "Mad Money" viewers Thursday he'd rather make money, which is why he took a minute to challenge the conventional "wisdom" the bears keep peddling.

With the markets so utterly focused on events overseas, Cramer fired up the Wayback Machine to remind investors what the bear case sounded like four years ago, and compared it to what actually happened.

Four years ago the world was falling off a cliff, according to the bears. There was the personal cliff with consumers harboring record levels of debt, the corporate cliff of heavily indebted corporations, the municipal bond cliff where every locality was nearing bankruptcy and, of course, the housing cliff where home prices were being obliterated.

Yet, over the last four years, the American consumer has been able to pare down debt, and a wave of refinancing has strengthened our corporations. Despite a few high-profile municipal bankruptcies, your local city hall remains intact. Yes, home prices were obliterated, but over the past four years the housing market has gone from severe overbuilding to a housing shortage in some areas. All in all, not the end of the world.

So today as the bears pound the table about Europe, they neglect to mention the markets have already discounted European profits of corporations to zero. China is just beginning its series of interest rate cuts, said Cramer, and rate cuts move stocks. Falling commodity prices are a good thing for the U.S., as is its production of a record amount of its own oil and natural gas.

The U.S. still faces its own euro-style fiscal cliff, but Cramer hopes leaders will wake up soon and address it. If our leaders abolish the uncertainty, that alone could pay for the belt-tightening that will be required, he added.

Cramer concluded by saying that when you look at it closely, "there's a lot less 'bull' in the bull case than you might think."

Executive Decision

In the "Executive Decision" segment, Cramer sat down with Debra Cafaro, chairman and CEO of Ventas ( VTR), a real estate investment trust specializing in senior living centers and medical office buildings. Ventas has been delivering compound annualized returns of 32.5% a year and is up 680%, including reinvested dividends, over the past decade.

Cafaro said Ventas is building a "framework for growth," noting that the company has a low cost of capital and a great team in place to both grow organically and through acquisition. Ventas is gaining scale, noted Cafaro, and is improving its balance sheet in the process.

When asked about the company's business and how it relates to debates over Medicare funding and health-care costs, Cafaro explained that Ventas is simply a landlord and the company's senior living centers, for example, are managed by Sunrise Senior Living ( SRZ) and other experienced operators. "We collect rents regardless of what happens with Medicare funding," Cafaro added, which is why the company is able to deliver consistent earnings.

Also adding to the company's strength is that Ventas serves the middle of the market, which makes its facilities accessible to middle-income seniors. Cafaro said 80% of her company's revenue stems from private paying tenants and not from government subsidies.

Cramer said he's been remiss in not recommending Ventas before as the company has been terrific for its shareholders. He recommended buying on any weakness.

A Cereal Dividend Booster

In a second "Executive Decision" segment, Cramer spoke with Ken Powell, chairman and CEO of General Mills ( GIS), the consumer packaged-foods giant that delivered a solid quarter Wednesday, but with conservative guidance.

General Mills also boosted its dividend by 8%, it's 12th boost in just eight years. Cramer currently owns shares of General Mills for his charitable trust, Action Alerts PLUS .

Powell said that while last year was challenging for General Mills amid some of the highest commodity inflation in 30 years, things are different now and commodity costs are trend below expectations. He said the environment overall is better and his company continues to innovate.

Powell said the packaged-food business is still very competitive and consumers are looking for health, convenience and value when they make their purchases. That's why General Mills has been able to take market share and is seeing strong gains in cereals, soups and organic products. The company's Greek yogurt business doubled in size last year, said Powell, and continues to see strong momentum.

When asked about international expansion, Powell noted that General Mills doesn't have a percentage target for how much business they'd like to do overseas. Instead, he said the company looks for where it can add and create value over time. That's why international sales at the company, even in Europe, remain consistent.

That said, General Mills is still very focused on the U.S., where its not "business as usual" with the unemployment rate still very high. Power said the environment in the U.S. is more challenging than ever, but the company continues to thrive.

Cramer said that investors need safe, consistent growers like General Mills in their portfolios.

Lightning Round

Here's what Cramer had to say about callers' stocks during the "Lightning Round":

Heckmann ( HEK): "This is a speculative play but I'm sticking with it. It's not going up until things start getting better in the business. "

Ford Motor ( F): "You can't buy it because they have big business in Europe and in Latin America. We need to wait."

Penn West Petroleum ( PWE): "This is a play on oil and I'm not saying that oil is going to bounce."

Microchip Technology ( MCHP): "You want to buy at a 4% yield."

Kinder Morgan Management ( KMR): "I'm going to endorse it. These stocks have come down tremendously."

LivePerson ( LPSN): "The stock has had a big move and I can only say cha-ching at these levels. "

Am I Diversified?

In the "Am I Diversified" segment, Cramer spoke with callers and responded to tweets sent via Twitter to @JimCramer to see if investors' portfolios have what it takes for today's markets.

The first portfolio included: Apple ( AAPL), Under Armour ( UA), Delta Airlines ( DAL), American Capital Agency ( AGNC) and Banco Santander ( SAN).

Cramer said he would bless this portfolio as diversified.

The second portfolio's top holdings included: AT&T ( T), Bristol Myers-Squibb ( BMY), Walt Disney ( DIS), Kinder Morgan Energy Partners ( KMP) and Wells Fargo ( WFC).

Cramer said this portfolio was "fabulous."

The third portfolio had: Exxon Mobil ( XOM), Verizon ( VZ), Southern Company ( SO), DuPont ( DD) and Pepsico ( PEP) as its top five stocks.

Cramer also blessed this portfolio as properly diversified.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer opined on the uncharacteristically honest evaluations of Facebook ( FB) the Wall Street analysts have been doling out this week. Cramer said he was actually surprised by the lukewarm coverage, which was full of cautious comments.

Cramer said when Morgan Stanley ( MS), the company that brought Facebook public, gives the stock a $38 price target, investors need to take notice, especially since $38 was Facebook's IPO price. And while other firms have given Facebook targets between $43 and $45 a share, even they have 12- to 18-month timelines for those targets.

Then there's Citigroup ( C), which rated Facebook a neutral with a $35 price target, citing the huge number of shares that will be exiting their lockup period soon.

Cramer said for him, Facebook remains a stock that's still expensive, with no catalysts to take it higher. He said Facebook is not only "hard to love," it's also "hard to like."

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

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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, DIS and GIS.

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