Jim Cramer's Mad Money Review

Buy Deere (DE), Jim Cramer said on CNBC's "Stop Trading!" segment Tuesday.
Cramer pointed to the stock's continued rise as evidence that he's right. "You know why?" he said, "Because the fundamentals trump the analysts." He praised CEO Robert Lane for "making great inroads" with the company. Of sector rival Agco (AG), Cramer said, "I gotta tell you. I think Deere is coming for them. ... I like Deere and I like DuPont (DD)."
Cramer said he liked the stock market's performance today, "given the fact that consumer confidence's been bad." He said he's worried about big gains in Research In Motion (RIMM), a company he recommended on Monday's "Stop Trading!" segment.
"I still like Apple (AAPL), but I don't have a strong thesis on Apple other than I believe in the iPhone," Cramer said.
In the investment management space, Cramer was bearish on Fortress Investment Group (FIG) "I have Wes Edens in my hall of shame," Cramer said. "Everything they've touched has turned to stone. This is a castle in the sand."
Cramer also said he disapproved of Citigroup (C) CEO Vikram Pandit. "What's Pandit doing?" he asked. "Sometimes you've got to take bold action. ... The last four acquisitions that Chuckie Prince did, I would just unwind them."
Published By TheStreet.com

Labels: AAPL, AG, C, CNBC's Stop Trading, DD, DE, FIG, Jim Cramer, RIMM, Stop Trading

Not a Borrower but a Lender Be: Cash America International (NYSE: CSH - News), Advance America, Cash Advance Centers (NYSE: AEA - News), New Century (NYSE: NEW - News) and NovaStar (NYSE: NFI - News)
"Where others see catastrophe, I see opportunity," Cramer said concerning the subprime lending crisis, and suggested playing difficulties with working class loans by investing in"pawnbrokers and loan sharks." Cramer calls CSH the "largest player in pawn lending," and comments the slightly risky and morally dubious AEA is "cheap, cheap, cheap." While others are spending their time and resources shorting NEW and NFI, Cramer prefers being bullish on CSH and AEA.

Rubble Stock: Chemed (NYSE: CHE - News)
Thursday's so-called "rubble stock" which Cramer thinks did not deserve the beating it took during the selloff was Chemed, a company which has a thriving Vitas hospice operation and Roto-Rooter plumbing business. Cramer likes CHE because it "blew away its numbers" right before the selloff, and although it has recovered somewhat, CHE is still low enough to buy. CHE jumped $7 in one day, and shed $2 during The Fall, and although the drop was not significant, Cramer still believes CHE is "immunized" against downside and he would buy it before "it gets its mojo back."

Sell Block: Fortress (NYSE: FIG - News), Goldman Sachs (NYSE: GS - News), Melco PBL Entertainment (NasdaqGM: MPEL), IPG Photonics (NasdaqGM: IPGP), Wynn (NasdaqGS: WYNN), Las Vegas Sands (NYSE: LVS - News), Artes Medical (NasdaqGM: ARTE), Switch & Data Facilities (NasdaqGM: SDXC), Aero Vironment (NasdaqGM: AVAV), Opnext (NasdaqGS: OPXT)
Cramer dedicated Thursday's Sell Block to tracking the success and failure of recent IPOs. He suggested selling FIG and buying GS instead. He would also sell MPEL and IPGP "on any strength," and admitted that Meclo was an "unmitigated disaster," and apologized for backing it, saying he "extrapolated" his bullishness from the success of WYNN and LVS in Macau. Cramer was glad he didn't recommend ARTE, because the company is not thriving, but would buy SDXC which is cheaper than its rivals and will have a "positive news flow in the near term." He also likes AVAV as a defense play and would pick up OPXT, but only when it dips.
CFO Interview: Rick Lindner, AT&T (NYSE: T - News)
Cramer asked CFO Rick Lindner how the company was able to put cash into AT & T Wireless, continue to develop and build its network and raise its dividend simultaneously. Lindner replied, "First of all, we've done three large acquisitions in the past three years," which have resulted in "tremendous opportunities for merger synergies. And those synergies are driving double-digit growth." He also commented on new products and growth in wireless and data. Although Cramer usually discourages a "buy and hold" strategy, he said investors "can buy AT&T and put it away," because it is well-run and has a solid yield.

Labels: AEA, ARTE, AVAV, CHE, CSH, FIG, GS, Jim Cramer, LVS, Mad Money, MPEL, NEW, NFI, OPXT, SDXC, WYNN

Market wise, equities are in the midst of the second-longest rally since 1929. Yet there are some serious warning signs -- especially sentiment
The odds are high that the current advance won't be able to continue. Stocks remain stretched and trade above past market multiples. What goes up must come down.
On the economic front, we are overdue for a recession. The last one occurred in 2000 and 2001. Business expansions don't last forever. The boom-and-bust pattern of an economic cycle has not been repealed.
An inverted yield curve almost always points to a deep business slowdown. The Fed publicly claims there's a 40% chance of a recession. However, a model of the Federal Reserve Bank of New York is essentially forecasting an outright recession.
Double-digit corporate earnings growth will be a thing of the past. Companies should consider themselves fortunate to experience single-digit growth.
The housing industry remains on the verge of a massive collapse. In our estimation, this real estate debacle is only in the top half of the second inning of a nine-inning ballgame.
Sentimentally speaking, our indicators are flashing major warning signals. At extremes, sentiment can indicate a peak or an important low. This contrary indicator is presently at an extreme level. Unfortunately, it's a very bearish one.
You need not look far for the evidence of the euphoria in today's market:
Fox plans to launch a new business channel. Newsweek magazine recently had a write-up on the success of the CNBC Business Channel.
Based on surveys by Investors Intelligence, bullish investment advisers hover between the 50% to the 60% range. These are at the high end of the spectrum.
The Dow Jones Industrial Average (Other OTC:INDUF.PK - News) achieved an all-time record high and the other indexes reached multiyear highs.
Small-cap stocks outperformed the other averages by a wide margin. Case in point, the Russell 2000 (Toronto:RUT.TO - News) skyrocketed to a record high in early 2007. In addition, it enjoyed an 18.9% gain last year.
Wall Street expects to pay out $23.9 billion in bonuses. A startling increase of 17% over the previous year's record. The world's largest investment banker, Goldman Sachs (NYSE:GS - News), reported a whopping profit of $9.4 billion -- the most ever for a Wall Street company in a given year. And it has set aside $16.5 billion for salaries, bonuses and benefits for employees. Lehman Brothers Holdings (NYSE:LEH - News) also produced record profits for the quarter and year. Bear Sterns experienced a record quarter.
In 2006, a combined total value of $1.6 trillion of mergers and acquisitions in the United States nearly beat the $1.7 trillion record for values in 2000 (the top of the high-tech bubble). Internationally, mergers and acquisitions of $3.8 trillion did overcome 2000's figures.
The utilization of derivatives surged to the quickest pace in eight years during the first half of 2006. According to the Bank for International Settlements, the face value of derivatives based on corporate bonds, currencies, interest rates, commodities and stocks leaped 24% to $370 trillion. It marked the biggest percentage increase since 1998.
On Feb. 9, Fortress Investment Group (NYSE:FIG - News) made history. It was the first hedge and private equity fund to go public, a $634 million initial public offering. In its first day of trading, Fortress shot up 89% in intraday trading.
In the United States, the number of hedge funds resumed its growth. There are in excess of 9,000 of these funds. Around the world it's 30,000 funds.
With all the frenzy, mania and froth, Wall Street failed to take note of how corporate insider selling has increased to its highest pace in 20 years. Furthermore, cash levels of mutual funds are near record lows. Without money for buying support, how do equities keep moving up?
Hence, our investing strategy: cash and go short.
We started the new year with 100% in cash, earning well over 5%, risk free. On Jan.17, we deployed 10% into the Rydex Ursa Fund (NASDAQ:RYURX - News). Ursa will rise when the Standard and Poor's 500 Index (CDNX:SPX.V - News) heads down in price. Another 10% is earmarked for RYURX if the S&P 500 moves higher in the coming weeks. The inverse action will provide us a lower cost-average price. The total return from cash and the short position should beat the market's performance for the new year.
The publicity shy Irwin Yamamoto has been managing money on the beautiful island of Maui for 30 years and is editor of the Yamamoto Forecast investment letter. He's as contrarian in his business as he is in his stock picks, choosing to forgo advertising, Web sites, e-mail or even a toll-free phone number. Investors interested in his monthly newsletter should write to P.O Box 573, Kahului, HI, 96733.
Content found in The Guru's Corner is subject to the terms and conditions found in the Disclaimer and does not represent a recommendation of investment advice. Investors should seek the advice of a qualified investment professional prior to making any investment decisions.
Published by MarketWatch

Labels: FIG, GS, INDUF.PK, LEH, RUT.TO, RYURX, SPX.V, Stocks