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NEW YORK ( TheStreet) -- There's always a better time to sell than into a market panic, Jim Cramer reminded "Mad Money" viewers Monday as he commented on the market's huge losses, the worst day in nearly three months. Cramer said that even if your outlook on the markets is negative, never ever sell stocks in the middle of a big move to the downside. Why? Because selloffs like those seen last week are always overdone to the downside, said Cramer, and within a few days there will be a rally, a moment of strength, where investors can lighten their loads and sell at far better prices. Cramer recalled learning this lesson the hard way back in his hedge fund days. He said the markets are largely controlled by traders, those who can get in and out of the market quickly. So even if there are "experts" on TV saying to sell everything, that advice likely doesn't apply to the individual investor with longer-term investment goals. So while this most recent weakness was caused by a misreading of the Federal Reserve minutes last week and further fueled by weakness in Europe, Cramer said it would be foolish to sell down here and raise cash. Use moments of strength like we saw this morning and sell into strength. Cramer said the goal is to always buy at a good price and sell at a better one, which is why selling when the market is down over 200 points is never the right move.
Living at the High EndThe rich are different from you and me, as F. Scott Fitzgerald wrote, and that's why companies that cater to the rich have stocks that are different, too. To that end, Cramer introduced his "Great Gatsby" index of luxury stocks. He said the list is not necessarily a list of stocks to go out and buy right now, but a way to measure the buying power of the high-end consumer. Among the list of retailers in Cramer's Gatsby index are Nordstrom ( JWN), Ralph Lauren ( RL), Michael Kors ( KORS) and Lululemon Athletica ( LULU).
On its conference call, Nordstrom said it sees no slowing in the spending of its customers, which is why it was able to deliver a six-cent-a-share earnings beat on strong same-store sales, with positive guidance to boot. Cramer said Nordstrom is expanding into Canada as well as beefing up its Web and mobile businesses to help further bolster sales. Ralph Lauren is another terrific high-end brand, Cramer said, a company that delivered a 22-cent-a-share earnings beat. Coach ( COH) may have fallen behind with its fashions, but not so with Ralph Lauren. When it comes to growth, Lululemon is one company that tops the list, said Cramer. This company also delivered strong earnings and, with only 130 stores, has plenty of room to expand. Finally there's high-end accessory retailer Michael Kors. Kors delivered a 23-cent-a-share earnings beat on better-than-expected revenue. Is Kors the new face of luxury? Cramer said he thinks so because Kors continues to surprise to the upside quarter after quarter.
Action Alerts PLUS . Cramer said that with 1,652 cafes, Panera is the high-end sandwich, soup and salad chain to beat. The company's restaurants enjoy tremendous customer loyalty, which means Panera can pass on rising food costs easily. Panera is growing earnings per share at 27% and the company plans on open 8% more stores this year. Then there's Starbucks, a company that's expanding all over the world, especially in China, where it plans to become the preeminent aspirational coffee house. Growth trends remain strong as Starbucks, said Cramer, which is why his trust continues to own it. Finally, Cramer said he remains a fan of Whole Foods, even though the stock has been crushed of late amid fears of slowing growth. Not so, said Cramer -- don't write off this healthy-eating giant. He said Whole Foods didn't cut guidance and growth should be returning to full steam soon.