Getting you more prepared if the fed decides to take action this month. You can protect yourself with a little more cash than you currently have, but not anything wholesale, not anything dramatic. I am not in favor of that. If anything, i suggest you stay the court if youre a home gamer. I want to explain to you why i feel were facing a decline of moderate proportions, one worth riding through if you can stomach it. Only the super nimble need to take action on what im about to tell you. Let me explain to you how i envision the risk reward versus some of the other declines weve seen in the last eight years. We have had several major selloffs during that period, and each one has had its own coloration. But only one was worth selling a majority if not all of your holdings into. The actual decline that cut the averages pretty much in half. Yes, the Great Recession decline. Thats the tremendous one that occurred when so many of our institutions, mainly household financials but also many industrials that we had thought withstood the test of time went belly up or claim close to collapsing. We even wondered if our atms were going to be able to spit cash out. It was that bad. Thats called Systemic Risk and that means its time to do some major league selling. Forget that. Were not faced with Systemic Risk. Then there were the second kinds of selloffs. This time typified by the 2011 decline of 21 from peak to trough. We had the possibility of a major collapse but not from here, from overseas. These markets are big and their power to pull down the world is so great that it was hard to assess the possible decline. We stopped at 21 because it created ways that the European CentralBank Launched to save the day. Finally there are these individual crises we have had to deal with, the possible collapse from china last summer, the giant bear market threatened to swamp the western world with eastern pay. We dropped precipitously aided by the fact that our fed was going to raise rates but then they took a pass so we bounced concerns about the solvency of our Largest Oil Companies and the 400 billion in debt they had on their books. Finally we had the brexit vote where we had so many funds that were out of position because they didnt expect the result of the vote. So we saw huge selling. Now if you look at each of these selloffs that we get, you could possibly get from a surprise rate hike, i would take off the table any Systemic Risk. Were taking that off. That removes exhibit a for certain. Risk again in our lifetime. Even as you often here were about to have it every time we have like a down 400 day as we did on friday. How about european debacle, 2011. This is again is a classic case of something that could be systemic, but not systemic to us. Still, would we have gone down more than 21 if italy had defaulted . Unequivocally we would have. That could have easily led to a domino situation where spain, portugal, ireland and greece could have collapsed, but it to a collapse as opposed to cypress or greece, theyre for real. Those are for real. The big systemic continental risks, and theyre tremendous cause for concern. We just definitely arent staring one of these in the face. Taking that off the table. Okay. Now how about that chinalike decline . All right. First lets talk china. I put a collapse in china would be worthy of a potential 20 selloff in the u. S. Im talking about something that would lead to a revolution that but we never even entered that realm last summer. We were dealing with a stock market collapse, not an economic collapse. Still that is far worse than what we are facing with one hike on the horizon. Nope. China, no. The ill dive in february i think was a very significant concern. Not just because the Oil Companies but the banks were into them so badly. Again, though, this has been cured by heavy equity issuance. Even if oil were to go back to there would be a bit of a cushion. How about this brexit . Could that be like what we could have with a rate hike . What can i say . We simply havent seen any of the negatives in britain yet. I believe there will be a lot of Financial Firms that will have to leave london to put their offices on the continent. I believe there will be many Construction Projects that will have to be canceled. I do believe that a bank rescue may have to occur and they do not have many big banks there. Systemic collapse anywhere. So where does this leave a now unexpected rate hike given the fact that we just had a big rally, which seems to be based on the possibility that ones not forthcoming. I think it leaves us to be somewhere less than the 2,000point decline we saw avenue the december rate hike because we dont have the oil problem. Although that started from a level that was 500 points lower than this one. And im saying that maybe on a rate hike thats a surprise, we could fall 7 from thursdays high, okay . Thats kind of where i come out. So what does that mean, say, for an individual stock . Lets deal with the stock, not an average. Why dont we take the case of apple, which stock benefited today from the obvious woes at samsung. I dont think those woes are going away easily. Apple stock fell hard beginning thursday morning when the going to release any numbers for the weekend. The market immediately deemed that as extremely negative. I didnt read it that way, not that anyone paid attention to me. But i focused on the fact the company reiterated its guidance. Thats a bullish fact. Its a fact that didnt need to be revealed. Lets say you are concerned about apple sales and you didnt sell into the panic on friday. Let me ask you, if the stock were to go down as much as i am forecasting for the market, if the fed surprises us, you could see this stock, which trades as high as 108 last thursday and went out at 105 today, you could see it go down 5. Whoa, it could go down 5. You want to own the stock, not trade it, betting that the weekend read would have been meaningless now that we know now there are little rally hundreds of thousands of channels. To me, this is a pretty decisive choice. I think you understand pat. I simply dont believe it is worth it to try to dart in and out of a stock like apple, even if you think the rate hike. Its a perfect example given the various declines weve seen. I dont think you need to take any action. I know that sounds boring, but thats my feeling. You know what, you can raise some cash into other positions but i dont want you to dump anything whole say. The panic on friday, those people feel terrible. You know what i am in favor of . I think to sell everything would be wrong, but to take some profits, thats cool with me. But remember you may have to get let me give you the bottom line. Is it worth it, say, to sell the most widely held stock in the world because of a rate hike knowing that wow have to get back in a few bucks lower . Do i really need to answer that for you . John in texas, john. Booyah, jim. Kudos to you and your team on ground zero rising. Thank you so much. You know, look, its the story that tells itself, and i was just thrilled to be working with a fantastic documentary team that, believe me, made me look really good. How can i help . Yeah, it was awesome. A twopart question. What are your thoughts on the music streaming industry and, in particular, Pandora Media . You know what, i think that industry is way too competitive. I dont want to be in it. I think pandora is look, if apple were to buy pandora, that would certainly make sense to me, but theyre not going to do. They want to do it themselves. I dont know who would necessarily have to buy them. I think theres like three up, three down. Pete . Booyah, cramer. Booyah, pete. Hey, at the end of august, you had the ceo of taser on the show, and you commented that taser had a good Competitive Position and growth runway. The next day the stock declined 8 . I know. On no news at all. And since then, 15 in total. So do you still feel bullish about taser . Yes, absolutely, pete. I think that a series of articles have said theyre system is too expensive for cities. I think thats whats really got the stock going down. I personally think its a great opportunity to be buying t stock of taser, not selling it. I like this selloff as a way to get in. Lets go to larry in illinois, please. Larry. Good evening, jim. I enjoy watching your show. Thank you. Every day. I have a question for you about a foreign bank. I am interested in looking and buying credit suisse. Would you please give me your opinion . I dont see a lot of momentum there. I dont see a lot of earnings managed to bounce off the bottom. You know, this, deutsch bank, theyre all kind of the same. I would prefer for you to be in a United States bank. If you think the rates are going to go higher, i would be in bank of america. And if you like the worldwide situation and wanted to be in a credit suisse, may i suggest you buy citi. Thats right, letter c, citigroup, which i think is well below book value. My travel trust owns it. I very very confident that stock is going to go higher. Nobody i repeat nobody ever got hurt taking a profit. But this isnt the time to cut and run. Thats not what history tells us. Whats a quarter point to the economy with the fed in focus . Despite the markets move higher today, im prepping you for the unknowns that come into a selloff. Telling you what plays could be worth circling back if it really comes true. And a company that do not telling you what it is. Stick with cramer. Announcer dont miss a second of mad money. Follow jimcramer on twitter. Have a question . Tweet cramer. Madtweets. Send jim an email to madmoney cnbc. Com. Or give us a call at 1800743cnbc. Miss something . Head to madmoney. Cnbc. Com. Why are you checking your credit score . I wanna see if it changed. Credit scores dont change that much, do they . Really . Ill take it. Sir, your credit. Is great right . When was the last time you checked . Yeah, id better check my credit score. Here, try credit karma. Its free. All right. No more surprises. Hey honey, yes, dear. Youre washing that bakedon alfredo by hand, right . Yes, dear. Dish issues . Cascade platinum powers through your toughest stuckon food. This turned out great. Cascade. Its the Phillips Lady anyone ever have occasional constipation, diarrhea, gas or bloating . [ simultaneously ] she does. Help defend against those digestive issues. Take Phillips Colon Health probiotic caps daily with three types of good bacteria. 400 likes . Wow phillips. Be good to your gut. Were going to prove just how wet and sticky your current gel antiperspirant is. Now, were going to show you degree. It wont let you down. Today you can do everything in just one click, even keep your toilet clean and fresh. Introducing lysol click gel. Click it in to enjoy clean freshness with every flush. Lysol. Hey, its just a quarter point. Its already baked in. A terrific one with 32 years in business said that to me in an elevator in asbury park this very weekend after i told her i was concerned about the down side from a possible rate hike. Sure i said it should definitely be baked in. But these things never seem to be discounted well enough. I believe that even more strongly after todays rally. She said byebye and disappeared down the block on a gorgeous night in a city fighting to make a big come back. Her decision looks right for the day. Shes right that a quarter point rate hike really shouldnt be a big deal at all. I wanted to tell her that. That doesnt mean you cant be concerned, especially after a big up day that needless to say lets use the selling respite to talk about the two worrisome issues here. The first is whether the fed tightening matters at all to the economy. I personally dont think its a good idea to raise rates into a expect that seems more tapped out than it was a few months ago. I also know that the fed may feel like it has to get on with it because were in emergency low rates without an emergency either here or overseas. Just because i dont want a rate hike doesnt mean we arent going to get one, which is why ive been willing to say that im okay missing a few Percentage Points the upside, especially when there might be so many bargains ahead after the fed takes action. But its the second reason that made me disagree with our very pleasant elevator companion. The issue of a rate hike being baked in and thats really what i want to focus on. All my professional life, i felt things that were so obvious, so right in front of our faces, things that everyone had to know that, particularly after todays strong rebound, which couldnt have happened if people were as worried about a rate hike as i think they should be. First there are the rational people who say, yeah, the fed tells us theyre data dependent. Theyre going to be on hold to stay. Theyre not going to do anything. They look at that last employment number and say they cant raise rates now. Other people say whats a quarter point to the real economy . Market. For stocks, it doesnt matter what will happen to the economy, it matters what people think will happen to the real economy. This second camp may think theyre ready to buy, and will say so right up until the moment that the selling gets thick. But believe me, they just arent that brave. When stocks are going down and going down hard, these people dont stop and say, were these sellers really caught unawares . No. They say, wow, there must be something really wrong i dont know about. Maybe im being too glib. The result . What you thought was a really rate hike, turns into something thats a nightmare for the bulls. I always say you can really very rarely go wrong betting that someone is going to do something stupid or ignorant on wall street. Its a much better bet to presume foolishness than to presume rationality and clear headedness. I wish it werent like that, but it is. Which is why i could not agree with the woman in the elevator despite her many years in the business. Heres the bottom line. Fools come to their senses or get blown out of the market until its really safe to go back into the water, once everyone knows about the rate hike. Because if you know that will be the case only after its already happened. Jim in new jersey, jim. Hi, how are you . Im good, jim. How about you . Im doing great, thank you. My mother im calling on her behalf. She has shes invested only in bonds, and the market value of her bonds right now is she purchased them for. And an investor basically told her that she ought to sell her bonds right now, take the gains, that the bonds have had a good run and that, you know, once the fed raises rates, that that run is probably going to end. I was just wondering if you had an opinion on it one way or the other. Jim, i got to tell you, i actually agree with that. I dont think i want to own a lot of bonds that are well above par, well above 100 that can go back down. And they can get hn i think ringing the register on some of that is not bad. Now, look, if you have bonds that yield a huge amount, okay, i get it. You want that income. But i think that her friend may be right. Lets not fool around. Take something off the table. I think weve seen the low rates for this cycle. The world of investing can help you make money, but it wont always make sense. While you might think a rate hike is a foregone conclusion, others may have blinders on right up to that event, particularly after todays dont let todays higher move fool you. A selloff could still be waiting in the wings. Tonight im preparing you for a yelleninduced pull back and give you my list of stocks. Then theres a new chip on the block entering the exciting new business of the internet of things. Im diving deeper into impinge to see if the remarkable run can continue. Can Charles River labs give your portfolio a healthy boost in an uncertain stock market . I suggest you stick with cramer. I absolutely love my new york apartment, but the rent is outrageous. Good thing geico offers affordable renters insurance. With great coverage it protects my personal belongings should they get damaged, stolen or destroyed. [doorbell] uh, excuse me. Delivery. Hey. Lo mein, szechwan chicken, chopsticks, soy sauce and you got some fortune cookies. Have a good one. Let geico help you with renters insurance. Hi welcome to the katy kat collection. My new mascara katy kat eye its the allday 360 cat eye ten times volume, darkness and no smudging ty kat matte lipstick from me and easy, breezy, beautiful covergirl wi 80 of recurrent ischemic strokes could be prevented. And im doing all i can to help prevent another one. A bayer aspirin regimen is one of those steps in helping prevent another stroke. Be sure to talk to your doctor before you begin an aspirin regimen. Oh, dishwasher, why dont you dry my dishes . Oh, he doesnt know any better. You just need to add finish . Jetdry . In the rinse aid compartment. Finish . Jetdry . For drier, shinier dishes. I dont want you to get complacent after todays terrific rebound. Like i mentioned at the top of the show, were not out of the fed woods so how can you prepare for a potential pull back if you think the fed could be up to its old confusing. Moment, rather than a panic of friday, to tell you about what happens in a selloff and if it when it does occur later this year. I dont like getting negative in the midst of a rout like friday. That sends you the wrong message. I prefer to wait for bullish days like today. If you want to take some profits, you can do so in a calm and deliberate way. The thing about selloffs is the best stocks tend to go down the hardest. But this and this is a theyre also the first to come roaring back. Why do the highest flyers go down the hardest in a major selloff . Because of doctrine. The doctrine that says never let your gains turn into losses. The stocks im going to highlight are all up magnificently for 2016. For professional money matchers, theres nothing worse than giving up these gains. Plus in september, so if youre a Hedge Fund Manager whos lucky enough to own some big winners, why not just take some profits and coast for the rest of the if you own the stocks i am talking about, these sellers, not the fundamentals of the companies, theyre your real enemy. But why do these winners also bounce back the hardest . Because of what caused them to run in the first place. They didnt need the feds help to arrive at their lofty destinations. Theyve defied the naysayers all year and theyre armed with stories, which means they arent going to be harmed by a quarter point or even a halfpoint rate hike. Otherwise, they never would have gotten this high to begin with. Get hammered and then rebound following a rate hike, and how did i find them . Well, first, i took the list of the best performing stocks in the s p 500. I did the same thing for the nasdaq. Then i added in a scan