Cramer's 'Mad Money' Recap: A Murphy's Law Market

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NEW YORK ( TheStreet) -- Everything that could go wrong today, did go wrong today, Jim Cramer admitted on "Mad Money" Thursday after the market's first big down day in quite some time. Cramer said the market received a healthy dose of both negative macro- and micro-data today, for which there was no place to hide.

Today's news that jobless rates were the lowest in six years may be great news for the economy and all those looking for work, but for stocks, which equate a growing economy with higher interest rates, this news was most unwelcome indeed. Higher interest rates foreshadow slower growth eventually, Cramer explained.

Then there were the disappointing earnings from tech bellwether Cisco ( CSCO), a stock Cramer owns for his charitable trust, Action Alerts PLUS, and Wal-Mart ( WMT).

Cramer said while Cisco actually announced pretty good quarterly numbers, its outlook was grim, sending shares down over 7%. He said he's not worried about the company's workforce reduction, however, as Cisco has done many acquisitions recently and will need to reduce head counts to eliminate duplicate positions. That may set the company up for future success, Cramer noted, as expectations for Cisco are now very low.

Cramer said he couldn't explain Wal-Mart's disappointments. With Macy's ( M) also reporting dismal sales, it's clear the consumer is slowing down, which runs counter to the lower jobless data we received today.

Other warnings signs in the market include rising gold prices and rising oil prices, which signal both fear and additional hardship for consumers.

Cramer said there's two ways the market can respond to this new data: Interest rates can retreat and earnings could surprise, which would justify the market's inflated stock prices; or, more likely, prices and estimates will fall to match the new reality.

That's why Cramer told investors to exercise caution and take profits where they can in preparation for a few more down days like today.

Executive Decision: Joe Papa

In the "Executive Decision" segment, Cramer sat down with Joe Papa, chairman, president and CEO of Perrigo ( PRGO), the generic drug maker whose stock is up 107% since Cramer first got behind the stock in February 2010 but has been under pressure in recent weeks, possibly creating a buying opportunity.

Papa shed some light on his company's recent acquisition of the Irish-based Elan, saying the merger gives Perrigo three things: a start towards global growth, solid licensing revenue and, as has been widely reported, having operations based in Ireland rather than the U.S. affords Perrigo over $150 million in annual tax savings.

Turning to the company's current business, Papa said three trends continue to drive double-digit growth for Perrigo. The first is the trend of prescription drugs going over the counter, the second is the move from national to private label brands and the third is Perrigo's innovation, where the company plans to introduce 75 new products this year, representing $190 million in potential sales.

Cramer called Perrigo a great growth story and one he plans on continuing to follow.

Off the Charts

In the "Off The Charts" segment, Cramer turned to colleague Carly Garner to analyze the next moves in natural gas. Is this year's seasonal low the time to buy, buy, buy? According to Garner, yes!

Looking at a daily chart of natural gas futures, Garner noted there's a huge short position being held by large speculators betting that the commodity will sink even lower. However, both the relative strength and William's oscillator, two measures of momentum, point to a huge oversold condition that's ready to snap in the other direction.

Garner further noted that, seasonally, this is the best time to buy natural gas as utilities begin stocking up for the cold winter season. It's also worth noting that nat gas held its key level of $3.20 last week, a move that prompted Garner to call that the bottom has indeed been made.

How high can gas rally? Garner said there's a ceiling at $3.47, which should easily breached, sending the commodity to the $3.80 or possibly the $4.40 level. Ultimately, Garner even sees natural gas possibly retesting its July highs of $5.20.

Cramer said that he's on board with Garner, saying that while the speculators are betting on further weakness, the lower prices continue to force drillers to stop drilling, which will eventually call cause the commodity to snap back in a big way. He said if Garner says that time is now, that's good enough for him.

Lightning Round

In the Lightning Round, Cramer was bullish on Hanesbrands ( HBI), Domino's Pizza ( DPZ), General Mills ( GIS), Sonic ( SONC), Bloomin' Brands ( BLMN), Red Robin Gourmet Burgers ( RRGB) and Occidental Petroleum ( OXY).

Cramer was bearish on Simon Property Group ( SPG), Callaway Golf ( ELY), JA Solar ( JASO) and Abercrombie & Fitch ( ANF).

Off the Charts, Part 2

For his second "Off The Charts" segment, Cramer turned to colleague and chartist Mark Sebastian to examine the CBOE Volatility Index ( VIX), more commonly known by its ticker, the VIX, to determine just how much fear is building in the markets.

According to traditional logic, any time the markets are rising the VIX should be falling, and vice versa. So closely linked is this inverse relationship that, according to Sebastian, any time the market moves and the VIX doesn't follow, that's the time to jump in.

Such was the case in June of this year. The S&P 500 had been falling sharply, and the VIX, as it should, was exploding. But then on June 24, the correlation broke down and the S&P tanked but the VIX didn't make a fresh high. That move signaled the bottom and an excellent time to buy.

Flash forward to today when we see the same pattern. The markets have been falling and the VIX has been on the rise, until the latter part of today when the S&P retested its lows but the VIX held firm. According to Sebastian, that signals the markets are done with their selling, at least for now.

Mad Mail

In the "Mad Mail" viewer feedback segment, Cramer followed up on OncoMed ( OMED), which stumped him on an earlier show. He said that after liking the IPO, he advised selling the tiny biotech. Now, however, Cramer said he likes the company's pipeline as long as shares can hold above their IPO price of $17 a share.

Cramer was bearish on Natural Grocers ( NGVC), a healthy eating stock that's richly valued at 70 times earnings. He was also not a fan of Immunomedics ( IMMU) or Avanir Pharmaceuticals ( AVNR), which are up 75% and 85%, respectively, so far this year.

Cramer was bullish, however, on Lululemon Athletica ( LULU), Radian Group ( RDN) and Walt Disney ( DIS) as he responded to tweets sent via Twitter to @JimCramer.

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 CSCO.

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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