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NEW YORK ( TheStreet) -- The Federal Reserve signaled it's staying the course and you should, too, Jim Cramer told "Mad Money" viewers Wednesday as he responded to the Fed's decision to leave interest rates alone and not repeat history. Cramer said there's no denying that some parts of the U.S. economy, such as retail and housing, are heating up in a big way. But as Caterpillar ( CAT) and FedEx ( FDX) both showed us today, other parts of the economy -- mainly manufacturing and exports -- still have a long way to go. So why would Fed Chairman Ben Bernanke risk raising interest rates when clearly the economy isn't completely back on its feet? Add to that the looming sequester, which promises to lay off thousands of government workers, and it's easy to see why Bernanke has chosen to be cautious, Cramer said. But more than that, Bernanke is a student of history and is attuned to the mistakes made in 1937, when the government threw our post-Depression economy back into recession by jumping the gun on increasing taxes and interest rates. That recession, he noted, was only stemmed by World War II. Add it all together and, Cramer said, it is easy to see why Bernanke has chosen to stay stock market-friendly and why his public goal of not raising rates until unemployment hits 6.5% may well remain in effect until, well, it does indeed hit 6.5%. That's why Cramer remains bullish on the sectors that are working, mainly the regional banks along with retail and tech, while advising investors to avoid manufacturing and anything that exports to the rest of the world.
Executive Decision: Ken PowellIn the "Executive Decision" segment, Cramer spoke with Ken Powell, chairman and CEO of food giant General Mills ( GIS), which delivered a seven-cent-a-share earnings beat on a 7.5% rise in revenue today after seeing strength across all regions of the globe. Powell said last year General Mills was faced with high food inflation and a consumer who wasn't buying a lot. This year, inflation is moderate and the economy is doing better, both of which have led General Mills to prosper. He said his company plans on continuing its marketing efforts and growing its advertising in line with its sales growth.
Among the bright spots for the company were soups and frozen foods in the U.S., while Powell noted that yogurt sold well in Europe and ice cream was hot in Asia and China. Even in the company's troubled cereal aisle, Powell said price points have been adjusted and brands are being reinvigorated. There are lots of ways for General Mills to win, Powell concluded. When asked about the company's dividend, Powell said General Mills remains committed to both its dividend and its stock buyback program and he hopes to continue the 11% compound annual growth they've been able to deliver in the dividend over the past few years. Cramer said stocks like General Mills are how investors make money. He told them to buy some shares, reinvest the dividends and hold on for the long run while Powell does the hard work of making the money.
Working on the RailroadsContinuing with his week-long "Oligopoly" series, Cramer turned his sights on the railroads, where a mere four players now control 90% of all rail freight in the U.S. Cramer explained that in 1978 there were 36 major railroads in the U.S. but thanks to deregulation that number shrank to just nine players by 1997. Today, there are only four, with CSX ( CSX) and Norfolk Southern ( NSC) operating in the east and Union Pacific ( UNP) and Burlington Northern, now part of Berkshire Hathaway ( BRK.B), in the west. Cramer said he's a fan of Berkshire because the company also has exposure to insurance and housing. In addition he likes Kansas City Southern ( KSU), which primarily operates lines from Mexico into the central U.S. He noted that shares of Kansas City are up 40% since he first got behind that stock in December. With natural gas prices on the rise and the prospect of increased coal usage likely, Cramer said shares of Norfolk Southern will be the biggest benefactor. He was also a fan of CSX, which has been adding trains to transport oil from the Bakken shale region.
Lightning RoundIn the Lightning Round, Cramer was bullish on Oneok Partners ( OKS), AT&T ( T), Verizon ( VZ), International Paper ( IP), Synovus Financial ( SNV), KeyCorp ( KEY), Oracle ( ORCL), Vale ( VALE) and Facebook ( FB).
Cramer was bearish on Windstream ( WIN).