Jim Cramer's 'Mad Money' Recap: A Deadly Washington Game

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NEW YORK ( TheStreet) -- The buyers in this are starting to think Washington has become a big joke, Jim Cramer said on "Mad Money" Wednesday, but he fears that the punchline could be deadly.

Simply put, Cramer said the market, and our economy, simply cannot afford to see a default on our debt come Oct 17. He said investors from around the world buy U.S. bonds for safety, stability and income, and if Congress takes those away, those investors will move their money elsewhere. This is a big deal, Cramer warned, and one investors should be taking seriously.

Yet, today's initial public offerings of Remax ( RMAX) and Burlington Stores ( BURL), operators of the Burlington Coat Factory chain, were up sharply despite the fact that real estate will be hurt badly by a bond default and apparel has been among the hardest-hit retailers this quarter. Cramer said investors are betting that a deal will come in the knick of time, but aren't factoring in the downside if it doesn't.

The buyers of these stocks are either worried they'll miss the rally if they don't get in now or they feel that stocks can withstand a default, but neither could be further from the truth if a deal is not reached and our country defaults on its debts, Cramer said.

Executive Decision: Marty Mucci

In the "Executive Decision" segment, Cramer checked in with Marty Mucci, president and CEO of Paychex ( PAYX), to see how the government shutdown and Obamacare are affecting employment in our country. Paychex last reported a one-cent-a-share earnings beat on better-than-expected revenue with the important metric of paychecks per client rising a modest 1.6%.

Overall, Mucci painted a bullish picture for small business in America. He said while some businesses are sitting on the sidelines and others are confused or delayed by the new laws and government shutdown, small business is starting to make a comeback as evidenced by 14 quarters in a row of rising checks per client.

Mucci said the biggest factor for small business formation is consumer confidence. He said if consumers are buying products, then entrepreneurs will open new businesses to meet those needs.

When asked about Paychex' decision to expand overseas, Mucci explained the move internationally does not mean there is no growth here in America, only that Paychex wishes to expand its footprint beyond the U.S. He said there are still plenty of opportunities for growth here in the U.S.

Cramer noted that Mucci has always been a straight shooter even when things were bleak, so he's encouraged to hear that despite all the trials of Washington business continues to march forward. As long as that continues, he said, Paychex will continue to be a winner.

Believe in Yourself

"This is an amazing country if you believe in yourself," Cramer told viewers, as a stunt on last night's 2,000th episode of "Mad Money" reminded Cramer of just how far he had come.

During the show, NYSE Euronext ( NYX) CEO Duncan Niederauer led Cramer off the set to reveal a hidden 1977 Ford Fairmont, just like the one Cramer lived in for several months during his early days as a crime reporter in California.

Cramer recounted how upon returning from a story, he found his apartment burglarized, leaving him with only the clothes on his back and his Fairmont. After borrowing a .22 caliber pistol from a friend, Cramer spent the next few months living in the back seat of that car, moving from friend to friend and truck stop to truck stop, all the while investing his paychecks in the market to begin building a better future for himself.

It was only after getting ill that Cramer was forced to return east to recover with family, he recalled, but from there his career, and his investments, grew -- ultimately leading to last night's 2,000th episode. Americans are not quitters, Cramer concluded, they can come back from anything.

Lightning Round

In the Lightning Round, Cramer was bullish on Yahoo! ( YHOO), Kodiak Oil & Gas ( KOG), Continental Resources ( CLR), EOG Resources ( EOG), Anadarko Petroleum ( APC), Noble Energy ( NBL), Travelers Companies ( TRV), Advanced Micro Devices ( AMD), Kandi Technologies ( KNDI), Polaris Industries ( PII), United Therapeutics ( UTHR) and BioMarin ( BMRN).

Cramer was bearish on Corrections Corp of America ( CXW) and Hartford Financial Services ( HIG).

Executive Decision: Al Monaco

In his second "Executive Decision" segment, Cramer once again sat down with Al Monaco, president and CEO of Enbridge ( ENB), our nation's largest pipeline operator. Shares of Enbridge current sport a 3% yield.

Monaco reiterated that Enbridge is a fee-for-service business and is not dependent on the daily fluctuations of oil prices. He said his company has long-term commitments from its customers, which afford shareholders a stable stream of cash flow.

But that stability doesn't mean Enbridge is not growing. Monaco said his company has $36 billion in capital and has added 30% to its staff recently, all in an effort to help get oil where our country needs it most. Pipelines remain the safest and most efficient way to transport oil, he said, but given how much oil our country is finding, we will continue to need all forms of transportation to move it.

When asked about Canadian oil, Monaco said the heavy oil from Canada is a natural fit for U.S. refiners and he feels disagreements over pipeline placements will eventually be resolved. He said the U.S. is on its way to energy self-sufficiency by 2020 or 2025, but those dates could be helped along by Washington if it chose.

Cramer said Enbridge continues to be an anti-Washington stock and one investors should consider.

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: DuPont ( DD), Qualcomm ( QCOM), Tesla Motors ( TSLA), Facebook ( FB) and Apple ( AAPL).

Cramer said he's throwing this portfolio back as it has far too much tech. He said to keep Facebook and DuPont and add a drug stock, an industrial and an oil stock like Enbridge.

The second portfolio's top holdings included: Lockheed Martin ( LMT), Microsoft ( MSFT), Cisco ( CSCO), Intel ( INTC) and Wells Fargo ( WFC).

Cramer also saw too much technology in this portfolio. He said to sell Intel and Microsoft and add an oil and a telco like AT&T ( T).

The third portfolio had: Yahoo!, Hasbro ( HAS), Blackstone Group ( BX), Melco Crown Entertainment ( MPEL) and Textron ( TXT) as its top five stocks.

Cramer said that this portfolio was properly diversified.

The fourth portfolio's top stocks were: Renewable Energy Group ( REGI), Boeing ( BA), Citigroup ( C), Ford ( F) and Advanced Micro Devices.

Cramer said that he was also a fan of this portfolio's diversification.

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

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-- 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, APC, CSCO, F, FB and WFC.

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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