Jim Cramer, host of Mad Money, on Wednesday, talked about the kinds of stocks he believes one should buy in the current economy.

“Let’s take a step back for a second and think, think like a portfolio manager when it comes to your own stocks. When you buy stocks, what you want is for the Fed to continue cutting rates. Investors never really like rate hikes, even when the economy needs them, because they’re bad for stock prices. And I expect whoever replaces Jay Powell next year will try to keep the cuts coming. That person will be more of an emissary for the president than a let-the-chips-fall-where-they-may empiricist, like we have with Powell. Long-term, possibly problematic. Short-term, market loves lower rates.”

READ ALSO: Jim Cramer Recently Commented on These 10 Stocks and Jim Cramer Discussed 11 Stocks and the Tech Battleground.

Furthermore, Cramer mentioned, “We’re going to get millions of new stock accounts” tied to the Trump Accounts from the “big beautiful budget bill” for newborns. He said he likes the idea and welcomed the flow of fresh money into the market. Cramer called the recent policy direction an early Christmas gift from Jerome Powell, and he advised viewers not to dismiss it.

“The bottom line: Just make sure you don’t get bearish when the time is right to be bullish going into the end of the year. And bears who are grumpy and unhappy, I expect you to come on… our network, and many others, and tell us that the buyers are wrong, that I’m wrong. And even as the buyers are making money and you may be losing fortunes, well, you want to tell us how right you are. Oh, that’s the plight of a bear in what seems to be a never-ending bull market. What can I say? Can’t please everybody.”

Our Methodology

For this article, we compiled a list of 7 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on December 10. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the third quarter of 2025, which was taken from Insider Monkey’s database of 978 hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).

Jim Cramer Highlighted 7 Stocks in Light of the Fed Rate Cut

7. Caterpillar Inc. (NYSE:CAT)

Number of Hedge Fund Holders: 70

Caterpillar Inc. (NYSE:CAT) is one of the stocks Jim Cramer highlighted in light of the Fed rate cut. Cramer highlighted the company while recommending buying industrials. The Mad Money host commented:

“Finally… You can buy any industrial because the hedge fund playbook says that industrials benefit from lower rates, even if you think it doesn’t matter. The fabulous irony of all this, frankly, is that Powell, in his own press conference, actually came out and said that a quarter point really doesn’t mean that much to any industry. I had to laugh at that one, but that’s not how hedge funds or even mutual funds think about it. They’ll eagerly buy Caterpillar and Cummins, two stocks at their all-time highs, just because they perfectly fit the environment.”

Caterpillar Inc. (NYSE:CAT) provides heavy machinery, engines, turbines, and rail equipment. In addition, the company offers power systems, parts, and support that keep the equipment working. During the October 31 episode, Cramer highlighted the company’s role in data center construction, as he said:

“Caterpillar’s become one of the best performers in the entire market, and I think that move is justified given how so much of their equipment is used to make and maintain data centers. The company holds an analyst meeting Tuesday. I want to know if this move is multi-year in nature. I have to tell you, spoiler alert, I think it is.”

6. Palantir Technologies Inc. (NASDAQ:PLTR)

Number of Hedge Fund Holders: 81

Palantir Technologies Inc. (NASDAQ:PLTR) is one of the stocks Jim Cramer highlighted in light of the Fed rate cut. Cramer noted that the company “makes a lot of money,” as he remarked:

“Now, I’d emphasize going after the ones that are already winning for this year. How about this one? I’m thinking of the stock of Palantir. Even when it’s already up so much, it makes a lot of money. It’s not a flier. It just got into the US Navy with a terrific contract helping to build submarines more efficiently… and much less expensively. I believe there’ll be many more Pentagon contracts coming, think surface ships, fighter planes… weapons, munitions. It wouldn’t surprise me if the whole arsenal of freedom goes to Palantir. It’s precisely the kind of stock that works in this market, the ultimate high flier that’s up huge, that you can buy it right now if you’re a money manager and show your investors that you, too, own Palantir.”

Palantir Technologies Inc. (NASDAQ:PLTR) develops data analytics and AI software platforms, including Gotham, Foundry, Apollo, and Palantir Artificial Intelligence Platform, that help organizations integrate, analyze, and act on complex data.