Jim Cramer's Mad Money Review

Get into General Motors (GM), Jim Cramer said on CNBC's "Stop Trading!" segment Tuesday.
The auto giant is a "heavily unionized company, and it's going to be non-unionized," Cramer said. "This is a non-union company very soon. I salute GM." He recommended preferred shares for more conservative investors.
Cramer weighed in on Kynikos Associates' Jim Chanos' short position in bond insurers MBIA (MBI) and Ambac (ABK). The move makes "a huge amount of sense," Cramer said. "The Buffett thing is really bad" for these companies.
"I admit Chanos is a rigorous thinker. I have watched his thinking for 20 years," Cramer added, recalling the investor's excellent call on Boston Chicken, which filed for bankruptcy in the late 1990s.
Cramer also discussed Pershing Square Capital founder Bill Ackman's call on Sears (SHLD). Cramer agrees with Ackman's long position in the retailer. "In Eddie Lampert I trust," he proclaimed, referring to Sears' chairman. "I'm not going back on my view."
Cramer continued, "It's very clear that this is a housing recession and [Sears is] housing." He said he thinks critics have been too hard on Lampert and Sears.
Published By TheStreet.com

Labels: ABK, CNBC's Stop Trading, GM, Jim Cramer, MBI, SHLD, Stop Trading

Jim Cramer outlined his own version of an economic stimulus plan on CNBC's "Stop Trading!" segment Friday.
The plan put forth by Treasury Secretary Hank Paulson "doesn't make any sense," Cramer said. "It's obviously a good boost for Apple (AAPL) ... Maybe a boost for Men's Wearhouse (MW)."
The real problem, Cramer said, is in the banks. "Every day you come in here, and your bank stocks are down." The source of all the trouble is the bond insurers, specifically MBIA (MBI), Ambac (ABK), PMI (PMI) and MGIC (MTG), he added.
Cramer's plan, he said, declares the bond insurers bankrupt, then "gives the municipal bonds over to Warren Buffett. ... It takes all these loans ... $500 billion ... and guarantees these loans for 50 cents on the dollar. ... It would cost us far less than the stimulus plan, and it would rally the stock market."
Cramer acknowledged the plan had some negative elements. "There are actual people that work at these companies; I feel bad about them," he said. But he says that the insurers are the reason that America's large banks can't determine their exposure to bad paper.
If, as Cramer believes, those four bond insurers are insolvent, the government can take them over. That, combined with a fed funds rate cut of 100 basis points would result in a gain of 2,000 points for the stock market.
Source: TheStreet.com

Labels: AAPL, Jim Cramer, MBI, MTG, MW, PMI, Stop Trading

Stick with agriculture and recession stocks, Jim Cramer said on CNBC's "Stop Trading!" segment Friday.
"Mosaic (MOS) is terrific. ... I think Agrium (AGU) is a catch-up ... to Mosaic," Cramer said. "You're going to do better with that than ... betting against Procter (PG)."
More broadly, Cramer believes the market is frantic as shorts try to cover their bets on the bond insurers. "Today's a big short-squeeze day. 'Let's short squeeze Ambac (ABK) and MBIA (MBI).'"
In the financial sector, Cramer expects more take-unders like Bank of America's (BAC) purchase of Countrywide (CFC). He foresees Washington Mutual (WMon the auction block, adding that CEO "Kerry Killinger is doing his best to do a bad job. ... Washington Mutual at $15 is like Countrywide at $8."
Cramer encouraged investors to play conservatively. "I would be partial to Coke (KO)," he said, adding that he was encouraged that commodity prices are down for the soft-drink company. Pepsi (PEP) is another good pick, he added.
Published By TheStreet.com

Labels: ABK, AGU, BAC, CFC, Jim Cramer, KO, MBI, MOS, PEP, PG, Stop Trading, WM

Coca Cola (KO) is a good pick for 2008's volatile trading environment, Jim Cramer said on CNBC's "Stop Trading!" segment Wednesday.
"Coca Cola said on my show not that long ago [that] raw costs [and] commodity costs actually peaked. ... People are paying much more for those earnings because they're so consistent. ... Coke is going to continue to go higher," Cramer said.
Meanwhile, Berkshire Hathaway (BRKA) insurance executive Ajit Jain is spurring a short squeeze on Ambac (ABK) and MBIA (MBI), Cramer said.
Cramer's skeptical about Jain's assertion today on CNBC that Berkshire Hathaway may buy one of the beleaguered bond insurers. "Why open a business and therefore crush your competitors when you want to buy?" He says it doesn't make sense to go shooting against them and also buy them.
Cramer is leery of Ambac and MBIA's viability. "Buffett has historically not wanted to buy black boxes," Cramer continued. "Eric Dinallo, [New York's] superintendent of insurance, is saying 'I don't trust these companies.'"
"The shorts cover then put out," Cramer concluded, because of continued turmoil in the housing and financial markets.
Cramer also commented on Google's (GOOG) recent bounce. "I still think Google is the tell for this market. ... It is not the fundamentals driving Google or Apple (AAPL). If that were the case, Apple would be at $200 and Google would be at $700."
Published By TheStreet.com

Labels: AAPL, ABK, BRKA, CNBC's Stop Trading, GOOG, Jim Cramer, KO, MBI, Stop Trading

Forest City (FCEA) is "one of the savviest" real estate companies around, Jim Cramer said on CNBC's "Stop Trading!" segment Friday.
Long-term value investor Marty Whitman recommended the stock when he made an appearance on CNBC earlier in the day.
"I think he's right. ... I remember when I was at Goldman Sachs (GS) ... we were in awe of these guys," he said of the Brooklyn-based builder. "All they have gotten is better and better," he added.
As a "very long term" investor, Whitman focuses on a company's outlook over "not six to 18 months, but six to 18 years," Cramer told viewers. It's important to keep that in mind when looking at his bullish take on troubled bond insurer MBIA (MBI).
As for Whitman's play on Florida real estate developer St. Joe (JOE), Cramer said, "There was supposed to be a major pullback. They admitted housing wasn't selling there."
"Now you got a book-value play," Cramer said. "I question this one. ... It seems cheap [but] I'm looking for a catalyst."
Cramer concluded the show by discussing Whitman's charitable organization, an entrepreneurial boot camp for veterans with disabilities. "I've given a lot to the Fisher House, which is another program for soldiers.
Published By TheStreet.com

Labels: CNBC's Stop Trading, FCEA, GS, Jim Cramer, JOE, MBI

General Dynamics (GD), Alliant Techsystems (ATK), L-3 communications (LLL), Raytheon (RTN), Lockheed Martin (LMT) Northrop Grumman (NOC)
Faced with the prospect of an economic slowdown, investors should look to defense stocks which "are the darlings of Wall Street…regardless of how the economy is doing." Political considerations won't affect the stocks, since Republicans like to spend on defense and Democrats want to look strong. Cramer concentrated on RTN since his prior recommendations, GD, ATK, LLL, LMT and NOC have all gone up. Cramer thinks RTN can easily beat its lukewarm guidance and notes the company's "fabulous" buyback and international growth.
ConcoPhillips (COP)
The oils have crept down on news of new taxes for oil companies and are low at least compared to rising crude costs. Cramer would use any dip as a buying opportunity for a long-term investment because "there's a simple case for oil … We're running out of it." He prefers COP because it is inexpensive, sells natural gas (which Cramer believes is consistently undervalued) and is not exposed to corrupt Third World regimes.
Related: Kurt Wulff comments on COP's low price and strong cash flow.
CEO Interview: T.J. Rodgers Cypress Semiconductor (CY), Sunpower (SPWR)
Cramer said Cypress is a good stock for those nervous about semiconductors, and Rodgers discussed the company's "extraordinarily flexible" chip that can be used in an e-bike, a Nordic track and an iPod. CY recently reported a "blockbuster" quarter and is seeing an upswing in demand for its products. In addition, CY owns half of Sunpower and plans to find a way to allow shareholders to benefit from this holding after tax restrictions are removed. Cramer said CY is the "cheap way" to own Sunpower.
Related: Eric Savitz asks if Cypress'core value worth is less than nothing.
MBIA (MBI), MGIC Investment (MTG)
Cramer would be wary of making too much money at once, an indication that an investor is not diversified enough. He suggests anyone who profited from the rise in MTG and MBI last week should sell the stocks, since they are not going higher.
Published By SeekingAlpha

Labels: ATK, COP, CY, GD, Jim Cramer, LLL, LMT, Mad Money, MBI, MTG, NOC, RTN, SPWR

Buy Altria (MO), Jim Cramer said Thursday on CNBC's Stop Trading! segment.
Cramer said recession fears and worries about financial stocks point to the need to buy consumer staples like cigarette maker Altria and soft drink companies Coke (KO) and Pepsi (PEP).
Cramer cautioned investors to stay away from mortgage stocks like insurer MBIA (MBI), because housing prices are far more important to the consumer's health than job numbers. Cramer said an unwarranted faith in the apparent strength of U.S. employment was behind the collapse of two hedge funds at Bear Stearns (BSC) this summer.
"Employment has been a false indicator for this economy," Cramer said.

Labels: BSC, Jim Cramer, KO, MBI, MO, PEP, Stop Trading

Countrywide (CFC), Ambac (ABK), PMI (PMI), MBIA (MBI), Washington Mutual (WM), Bank of America (BAC), Wachovia (WB)
To those who dread a Fed rate cut due to inflation worries, Cramer says oil and grain prices will not be alleviated by a rise in interest rates. "The thing that would knock the market down huge is obviously they don't cut," said Cramer; " … all year people have been focused much more on inflation. It's deflation that I'm worried about."
While raising interest rates may strengthen the dollar's value, Cramer insists this is not so simple; "the dollar is highly correlated to economic growth, not to the price of money."
"I've seen whole economies raise interest rates to be able to defend their currency and fail repeatedly," he said. "Where people want to be is in a country that is controlling its own fate, tends not to have as big a trade deficit as we have and is growing, and our country is not growing, therefore you don't want the currency."
While he does not think CFC, ABK, PMI, MBI and WM can be rescued by the Fed, and those too took mortgages between 2005 and 2007 may be "wiped out" a rate cut may still save those who took mortgages in 2007.
If rates are not cut, "Armageddon is back on the agenda," added Cramer. While Countrywide is currently engaged in a battle for its survival, BAC and WB will report "quarter of quarter of losses," which will cause people to view the crisis "very differently."
Published by SeekingAlpha

Labels: ABK, BAC, CFC, Jim Cramer, MBI, PMI, Wall Street Confidential, WB, WM

Safer than Houses: Intel (NasdaqGS: INTC - News), Texas Instruments (NYSE: TXN - News), Cisco Systems (NasdaqGS: CSCO - News), and Microsoft (NasdaqGS: MSFT - News), Advanced MicroDevices (NYSE: AMD - News)
Often people run from tech during a selloff, but Cramer notes tech is now the safe sector with significant upside potential, since these companies have enough cash to make huge buybacks. Cramer proclaims he is once again an "Intel-aholic" as he was in the 90s, because the stock is cheap, has loads of cash and an accelerating growth rate. Compared with AMD, Cramer says Intel is "the much stonger part of the duopoly" and has a lower price tag.
The Rant Heard Round the World
While some think Cramer's rant against the Fed last Friday was overdone, Cramer believes he was "the most responsible guy out there. He added, " The AAA-rated mortgage bonds are trading horribly or not at all. These are good pieces of paper, yet they've been marked down," Cramer said. He says has no idea why Ben Bernanke is still worried about inflation, and observed that the Europeans are concerned about the ripple effect of the US mortgage crisis. "My rant was the rant heard around the world," Cramer said, "The only one who hasn't heard it is Chairman Bernanke himself."
Mad Money Madness Index: MGIC (NYSE: MTG - News), MBIA (NYSE: MBI - News), KB Home (NYSE: KBH - News), Blackstone (NYSE: BX - News), Centex (NYSE: CTX - News), Beazer Homes (NYSE: BZH - News), Washington Mutual (NYSE: WM - News)
Cramer says those who have not sold the stock in his Mad Money Madness Index are being hoggish; "Greed is not good ... The market makes you pay for it."
CEO Interview: Dr. Eli Harari, Sandisk (NasdaqGS: SNDK - News)
Cramer thinks SNDK will rise next week if there is a day that is not "horrible," and he likes the company because flash memory is "hot," will replace disk drives and is the favorite of companies like Apple. He said Dr. Eli Harari's bullish remarks at a recent Flash Memory Summit reminds him of Cisco CEO John Chamber's fully justified optimism. Dr. Harari commented flash is everywhere, is contributing to market acceleration and is much cheaper than it used to be. "There's no question that flash memory today is the fastest-growing market within the semiconductor market," Dr. Harari said. "And I do not see it ending anytime soon."
Published by SeekingAlpha

Labels: AMD, BX, BZH, CSCO, CTX, INTC, Jim Cramer, KBH, Mad Money, MBI, MSFT, MTG, SNDK, TXN, WM

Cramer's Index: MGIC Investment (NYSE: MTG - News), Countrywide Financial (NYSE: CFC - News), Bear Stearns (NYSE: BSC - News), KB Home (NYSE: KBH - News), Centex (NYSE: CTX - News), MBIA (NYSE: MBI - News), Blackstone (NYSE: BX - News), Thornburg Mortgage (NYSE: TMA - News), Beazer Homes (NYSE: BZH - News), Washington Mutual (NYSE: WM - News), Goldman Sachs (NYSE: GS - News), Citigroup (NYSE: C - News)
While Cramer says he doesn't want to be a "buzz kill," he admits it is not possible to be really bullish as long as the housing crisis persists. Cramer formed his own "index" of the above-mentioned stocks, and said when the 12 companies stablilize and the Fed cuts interest rates, it will be time to let the bulls run once again. He made a personal appeal to Fed chairman Ben Bernanke; "Cut the rates. Take the pressure off. Many, many people could be about to lose their homes, because you're not listening..."
New Age Under Armour: Lululemon Athletica (LULU)
Cramer has discovered a new Under Armour, which like its predecessor, has experienced a massive initial bounce and is expected to keep growing. Yoga apparel company, LULU came public at $18 and jumped to $31 "in one of the worst tapes I've ever seen," said Cramer. However, he doesn't think this stock is a "one trick pony" but will keep going up as UA did, because LULU has been doubling stores year over year. Since the stock is speculative and has risen, Cramer recommends waiting at least 3 days or until the price drops before buying.
Beer is Near: Boston Beer (NYSE: SAM - News)
While in the current climate, investors are dubious of even some soft goods stocks, "People drink beer no matter what." Cramer likes SAM's 13% long-term growth rate and its smart move of acquiring a brewery from Diageo for $55 million rather than building a new one, which would have cost $200 million. Although he's a self-proclaimed "Bud man" Cramer gives SAM a triple buy, even near its 52-week high.
CFO Interview: Stephen Chazen, Occidental Petroleum (NYSE: OXY - News)
Chazen discussed production increases in Argentina and Peru; "California continues to be good for us." he added. Chazen dismissed worries about political risks, noting there are always political risks, and he remarked on the stability of OXY's chemical business. "All oil stocks are trading down in unison," Cramer said, and added now is the time to buy oil.
Published by SeekingAlpha

Labels: BSC, BX, BZH, C, CFC, CTX, GS, Jim Cramer, KBH, LULU, Mad Money, MBI, MTG, OXY, SAM, TMA, WM

Most Under Priced Calls: These are the most under priced calls of all stocks in our database. While the Equities Explosion List finds groups of calls for individual equities that are under priced, this list finds the most under priced individual calls. Thus, the options listed here will tend to be more severely under priced.
MBIA Inc. Apr 70 Calls (NYSE:MBI - News). MBI's PowerRating is 5.
Most Under Priced Puts: These are the most under priced puts of all stocks in our database. While the Equities Explosion List finds groups of puts for individual equities that are under priced, this list finds the most under priced individual puts. Thus, the options listed here will tend to be more severely under priced.
Express Scripts Apr 80 Puts (NasdaqGS:ESRX - News). ESRX's PowerRating is 3.
Most Overpriced Calls: These are the most overpriced calls of all stocks in our database. While the Equities Implosion List finds groups of calls for individual equities that are overpriced, this list finds the most overpriced individual calls. Thus, the options listed here will tend to be more severely overpriced.
Indymac Bancorp Apr 30 Calls (NYSE:NDE - News). NDE's PowerRating is 5.
Most Overpriced Puts: These are the most overpriced puts of all stocks in our database. While the Equities Implosion List finds groups of puts for individual equities that are overpriced, this list finds the most overpriced individual puts. Thus, the options listed here will tend to be more severely overpriced. Research in Motion Apr 120 Puts (NasdaqGS:RIMM - News). RIMM's PowerRating is 5.
Stocks with Abnormal Call Volume: These are stocks which showed unusual call option volume not easily explained by arbitrage operations. The appearance of a stock on the Call Volume Alerts list suggests a possible takeover, extraordinarily good earnings report, or other news which may favorably affect the stock.
Mirant (NYSE:MIR - News). MIR's PowerRating is 4.
Stocks with Abnormal Put Volume: These are stocks which showed unusual put option volume not easily explained by arbitrage operations. The appearance of a stock on the Put Volume Alerts list suggests an extraordinarily negative earnings report, or other news which may negatively affect the stock.
Lennar (NYSE:LEN - News). LEN's PowerRating is 5.
Abnormal Put/Call $ Volume: These stocks have the highest dollar put volume in relation to their call volume. These high ratios are indicative of extreme bearish sentiment in the underlying stock.
Centex (NYSE:CTX - News). CTX's PowerRating is 5.
PowerRatings are courtesy of TradingMarkets.com

Labels: CTX, ESRX, Hot Options, LEN, MBI, MIR, NDE, RIMM

Labels: BGC, BP, CIT, MBI, PKG, RVBD, WFC

Stocks Ready to Surge: These are the stocks that today made new 10-day lows that are still in an uptrend as they are trading above their 200-day moving average. They are sorted in rank according to how over-extended they are vs. their 10-day moving average. For example, the top ranked stock is trading the furthest distance from its 10-day moving average on a percentage basis. Historically, these stocks on average have had larger than normal short-term upside reversals.
MBIA Inc. (NYSE:MBI - News). MBI's PowerRating is 5.
Low-Priced Stocks Ready to Surge: These are the stocks under $10/share that today made new 10-day lows that are still in an uptrend as they are trading above their 200-day moving average. They are sorted in rank according to how over-extended they are vs. their 10-day moving average. For example, the top ranked stock is trading the furthest distance from its 10-day moving average on a percentage basis. Historically, these stocks on average have had larger than normal short-term upside reversals. Please note: All stocks carry risk and low-priced stocks usually come with even more risk. Always use caution.
Qwest Communications (NYSE:Q - News). Q's PowerRating is 6.
Pullbacks from Highs: Most successful momentum-based traders and money managers like to buy strong stocks after they pull back. TradingMarkets.com uses a proprietary mathematical model to identify up to 30 (in weak or choppy markets there will be fewer) of the strongest stocks that have pulled back from recent highs. These stocks should be considered potential candidates to resume their longer-term up trends.
Guess (NYSE:GES - News). GES's PowerRating is 6.
Trading Where the Action Is: This list contains the most volatile stocks over the past 50 trading days. These stocks are only for the most aggressive traders who are willing to assume a high degree of risk in order to capture larger gains.
International Asset Holdings (NasdaqCM:IAAC - News). IAAC's PowerRating is 3.
Stocks Ready to Drop: These are the stocks that today made new 10-day highs that are still in an downtrend as they are trading below their 200-day moving average. They are sorted in rank according to how over-extended they are vs. their 10-day moving average. For example, the top ranked stock is trading the furthest distance from its 10-day moving average on a percentage basis. Historically, these stocks on average have had larger than normal short-term downside reversals.
Express Scripts (NasdaqGS:ESRX - News). ESRX's PowerRating is 3.
Pullbacks from Lows: Most successful momentum-based traders and money managers like to sell weak stocks after they pull back. TradingMarkets.com uses a proprietary mathematical model to identify up to 20 (in strong or choppy markets there will be fewer) weak stocks that have pulled back from recent lows. These stocks should be considered potential candidates to resume their longer-term downtrends.
Gulfmark Offshore (NasdaqGS:GMRK - News). GMRK's PowerRating is 5.
Explosion List: An inherent feature of all markets is that periods of lower-than-normal volatility are usually followed by periods of higher volatility. These stocks are trading at one-third or less of their normal volatility and therefore have a high likelihood of exploding within the next few trading days.
Baidu.com (NasdaqGM:BIDU - News). BIDU's PowerRating is 6.
PowerRatings are courtesy of PowerRatings.net

Labels: BIDU, ESRX, GES, GMRK, IAAC, MBI, Q