Cramer's 'Mad Money' Recap: A Resting Bull Market

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NEW YORK ( TheStreet) -- Even the strongest of bulls have to rest eventually, Jim Cramer told "Mad Money" viewers Wednesday. He once again urged them not to jump into the markets during what is now the longest consecutive-day rally since November 1996.

Cramer said a lot of things have changed since 1996, back when dial-up Internet and low-cost brokers were democratizing the stock market and making it accessible for everyone. Back then was the golden age of investing, Cramer recounted, with the markets having little to worry about except gridlock in Washington.

But in today's markets, investors have been conditioned to worry, said Cramer, even though stocks are cheaper now than the were back in 1996, while taxes are actually lower now than they were in 1996. Stocks are so cheap, and companies so brimming with cash, that it's easy to see why there have been so many takeovers, mergers, dividend boosts and stock buybacks.

Cramer said there's a reason why today's retail sales number were so strong -- it's because of the wealth effect created by a rising stock market, rising home prices and increased job stability. Add those together and consumers simply spend more.

Cramer concluded by saying investors can still make a lot of money in the markets, but they can't own stocks making all-time highs after a nine day rally. Instead, they should be looking at the laggards in tech and the financials, which are still far from their highs and are cheap by any metric.

Executive Decision: Ben Baldanza

In the "Executive Decision" segment, Cramer spoke with Ben Baldanza, president and CEO of Spirit Airlines ( SAVE), a no-frills airline that trades at a scant 11 times earnings despite being profitable every year since 2007.

Baldanza explained that Spirit caters to price-sensitive customers who have an eye for value. He said the airline views fees more like options when you buy a car in that some customers choose to pay extra for a better experience while others may prefer just the basics. Using that model, he said, some customers can opt to pay more but others will not have to subsidize their neighbors' tickets by paying extra fees.

Baldanza also said Spirit is one of the few airlines that's actually run like a business. He said the company has good margins and is profitable in every city it services.

When asked how industry consolidation affects Spirit's operations, Baldanza said consolidation has stabilized the airline industry by reducing over-capacity and eliminating some of the most cut-throat competition, allowing for all the airlines to run their businesses better and more profitably.

Cramer said that after endorsing airline stocks for the first time in decades last week, Spirit is one of the best picks in this re-emerging industry.

Revisiting 'Gatsby'

With retail sales continuing to roar, Cramer revisited his "Great Gatsby" index of luxury stocks, expanding the list with six new names including Toll Brothers ( TOL), builders of high-end homes; Brunswick ( BC), makers of boats and recreational vehicles; Saks ( SKS) and Coach ( COH), in the retail and accessory space, along with Tiffany ( TIF) for jewelry and Estee Lauder ( EL) for makeup.

Cramer said his original index, which included Whole Foods ( WFM) and Michael Kors ( KORS), has lagged the S&P 500 by a hair and also lacked the diversification for a true gauge of spending by the wealthy. He said by adding these names, the index now better represents all high-end goods.

Cramer said Saks, Coach and Tiffany complement his original set of retailers, while Brunswick is the quintessential discretionary spending company. Estee Lauder is the premier beauty player, he added, while Toll Brothers has been his favorite high-end home builder for years.

By adding all of these names, Cramer concluded, investors can now use the entire Gatsby index to better see exactly where the high-end of retail is heading.

Lightning Round

In the Lightning Round, Cramer was bullish on Micron Technology ( MU), CVS Caremark ( CVS) and Cummins ( CMI).

Cramer was bearish on Sprint Nextel ( S), Pacira Pharmaceuticals ( PCRX) and JC Penney ( JCP).

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: Abbott Laboratories ( ABT), Berkshire Hathaway ( BRK.B), Conoco-Phillips ( COP), McDonald's ( MCD) and Pulte Homes ( PHM).

Cramer blessed this portfolio as perfectly diversified.

The second portfolio's top holdings included: Pepsico ( PEP), Merck ( MRK), Oracle ( ORCL), Emerson Electric ( EMR) and Suncor Energy ( SU).

Cramer said this portfolio was also properly diversified.

The third portfolio had: CenterPoint Energy ( CNP), Bristol Myers-Squibb ( BMY), General Electric ( GE), Waste Management ( WM) and Kellogg ( K) as its top five stocks.

Cramer said he was also a fan of this portfolio.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer once again made the suggestion that Apple ( AAPL), a stock he owns for his charitable trust, Action Alerts PLUS, should buy streaming movie giant Netflix ( NFLX).

Cramer thinks Apple has hit a wall with its current AppleTV plans, and that wall is the content providers who are not willing to seed their customers to Apple.

Cramer said that neither bullying or negotiation are likely to change these providers' minds. Meanwhile, Netflix already has 26 million subscribers paying for streaming content into their living rooms and would likely welcome an Apple-centric revamp of the service and its offerings.

With over $100 billion in cash, Cramer said it's important for Apple's share price for the company to return a sizable chunk of that cash back to its shareholders. The value created by a Netflix deal would give Apple the growth it needs.

To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

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

To email Scott about this article, click here: Scott Rutt

Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDC

At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, ABT, BMY and GE.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com 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 TheStreet.com, 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 TheStreet.com is related to the specific opinions expressed by him on "Mad Money."

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