>> also the c in guy's clam. >> it was. mel was saying last night felt like a playoff game in carolina, tim. >> a lot of ranger fans. >> it was like msg south. >> kind of embarrassing for carolina, by the way. >> transocean. comes out rig. >>nuanyo gthk u for watching "f money." "mad money" with jim cramer starts right now. my mission is simple, to make you money. i'm here to level the playing field for all investors, there is always more work and i promise to help you find it. mad money starts right now. hey, i'm kramer. we are trying to make you some money, my jobs are to entertain, call one 807 43 cnbc, we are coming here, you better believe you make some mistakes in a highly visible, highly public way.

and by you, of course i mean me. that's why every year i like to hold a day of atonement to help you learn for my worst mistakes, tonight i will demonstrate how we can all improve by examining a number of calls on mad money and travel trust, explaining why they occurred. and what you can do to learn for me and do it better. here are the biggest errors i see made, how i will vow once again to try not to make them even as different ones pop up to haunt me. most of the thing i do wrong these days are not rookie mistakes, it's rare now that i suggest a quick trade and it goes awry because anyone who has watched the show knows that i have moved away speedily against trading. it's been most of my time trying to show you investing, i have come to dislike the

suggestion of daytrading, quick trading, i think it will hurt your chance of making money. it's wrong to trade unless you are doing a full-time job and even then, i would not recommend it. our mistakes really have to do with not doing homework, there's more and better homework than i did with my hedge fund, their savvy people who have been with me for some time and are really fabulous, a great team in the investing club too, i am being crushed by my homework, there are hundreds more public companies now than when i started. if anything, it's the pposite of rookie mistakes are making, what we call them veterans mistakes? my errors are rooted in overconfidence and areas of judgment and too much glee from what has worked well before the has to work again, the blunders i make is i sometimes feel like i've seen a movie before and i know how it ends, investing in the stock market means in reality, it's more like a close sporting event where you don't know the outcome and just when you are sure you do, that's

where you get the big upset. the worst errors i made have to do a trust, either by being too trusting or not trusting enough, i've trusted too many executives with good track records who told me not to worry, these are usually people with a lot of credibility but eventually, you can start believing your own bs and at the same time, there are other executives i did not trust who perhaps upon closer view actually deserved a bit more credit. most of all, i do this night of self-serve -- criticism and i do it all the time, i do it to remind me and remind you that while i come out here daily to try to get it right, i'm only human and i fall prior to all misjudgments anyone else my fall prey to, we have got to learn from them nonetheless. let me start with a story that really -- gets me down, a story where i had too much faith in management power to have an

objectively difficult situation, i'm talking about the ale of johnson & johnson, one of my favorite companies, and to we finally threw in the towel and give up the position promptly in the summer of 2023. normally, when we sell it's because something has changed in the company or the industry, or the stock hits our price target, we set price targets if you subscribe to numbers -- members of the club, we care about chasing profits as we teach members of the club which chronicles the moves of the trust and details any trade for the trust makes, we care far more about containing losses when you control your losses guess what, the games take care of themselves, we did not sell the johnson & johnson, i still believe they have one of the best form of pipelines in the industry along with a terrific medical device proponent. we gave up on johnson & johnson because we were tired of being hostage to legal decisions that had little to do with the

greatness of the storied company. specifically they were neckdeep in lawsuits involving its baby powder and whether it's one time key ingredient had traces of asbestos that might've caused cancer. 20 years ago, i would have known equally that asbestos lawsuit equals cell, it is so long that i forgot how ugly they could get for shareholders, i forgot that asbestos is a magnet for plaintiffs. i believe j&j's lawyers had control, they had good resumes but you could have said the same thing about all about defense lawyers who lost cases in the 1980s. when these lawsuits first exploded, i said i know how to deal with this, i brought in the ceo on the show, after considerable out of research, i came to the conclusion they acted in good faith, they did know about -- did not know about the asbestos, the whole theme seemed like an accident, that was a misjudgments since then, there had been a seemingly endless number of

cases filed against j&j, while it's won many of them, it's lost big ones including a $2 billion judgment that made me believe i simply was not taking the plaintiff's side seriously enough, 20 years ago, i never would have bet on a company in asbestos litigation, that's a great way to light your money on fire. i forgot how tough these lawsuits were, i forgot how good the great companies who went under because of asbestos, it is -- that had nothing to do with it. then j&j came up with an excellent strategy, pay 8.9 billion to the plaintiff's. more important, put immediate muddy -- money in the hands of the plaintiffs, i started feeling hopeful, another mistake, the third circuit court in philadelphia i find out later hates these agreements , these bad settlements, that's what they think. how can they not see that coming? j&j's lawyers were so optimistic and i was a full to believe them. in the meantime, j&j had a successful ipl, when the

trouble trust that owned j&j, we were betting on the fundamentals of the company, we were betting on the thing that controlled the stock and that was the litigation. you never want to play that game, it is a game. i was far too sanguine about j&j's ability to get a settlement to the novel use of the bankruptcy code, the judge overseeing the flow bankruptcy filed with plaintiffs against j&j. they found themselves to the mercy of the clients, the court ruled that j&j was not in financial distress so it did not have a right, that's why i knew these cases would mount up leading to another procession of hard to predict verdicts, hence why we finally gave up on j&j for the trouble trust, it did not matter that i thought they were not particularly culpable, it did not matter that the fundamentals were terrific, what matters is that through this litigation, they were potentially there for billions and billions of dollars almost -- and losses,

then they do not want to have the position that is precarious due to lawsuits in the fundamentals, this business is hard enough without playing litigation relet via the jackpot justice system we have, i don't want to wake up one day to discover that some runaway jury decide they were at fault not because of stockholders but because of claimants, i've seen this happen several times where companies absolutely had it coming, i don't think j&j is one of them, they have a tremendous balance sheet too but so what ? it does not matter what i think, that's what the jury thinks, you do not bet on friendly juries within it best -- asbestos suit, that worked against them, well endowed company that should be allowed to file for bankruptcy, i did not think the ultimate upset was worth hoping for, given the age of our legal system, there is no way to tell if this was big. that's why we had the travel trust done, i like betting on businesses, not lawsuits and lawyers who gain them, if you ever find yourself betting,

don't try to fight it just because you love the company, like i did with j&j for so long, believe me, there are better and easier ways to try to make some money , let's go to eric in florida, eric? >> thanks for my call. >> of course, what's up? >> my question, do you advise investors or home gamers take their first $10,000 and put that into a low-cost index fund? >> i do. >> my question is as is home gamers build wealth over time, the weighting of that initial $10,000 from an overall portfolio perspective if you are doing it right, you know becomes less significant, what do you recommend home gainers maintain as a weighting in terms of that position and would you also maybe advise adding cues or iw i'm quite the >> what a great question i got to tell you, yes indeed i think a -- more about the small investor than i do the smaller one but if you save overtime,

what you want to do is probably get it so that's about 50% of your portfolio at minimum is the index fund that you can have some other stocks that may be miss some bonds as you get over, i do believe the index fund is the bedrock. let's go to sean in massachusetts. >> thank you so much for taking my call, thanks to the ladies that got me check in. you talk a lot about s&p 500 or something similar, my question is should i change my current investment in my 401(k) plan through my employer's for the vander guard and x.500 at 500%, should i put it with the current -- plan? >> i am very conservative to me, i want to diversify and that means index fund best, it sounds like you are doing it very right, i'm incredibly conservative when it comes to retirement money if you ever find yourself betting on a brutal set of lawsuits, do not try to fight it just because you love the company like i did with j&j so long, you must believe me when i say there are better ways to make money.

silicon valley bank to boeing, i'm sharing the pain i've experienced in the years i've been around. i got to tell you something. the best strategy on how to handle it is what we you learn tonight, don't fret, you and i will get through this together, stay with cramer. a force to be reckon with. no, not you saquon. hm? you! your business bank account with quickbooks money, now earns 5% apy.

5% apy? that's new! yup, that's how you business differently. rylee! from rylee's realty! hi! this listing sounds incredible. let's check it out. says here it gets plenty of light. and this must be the ocean view?

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the market just like real life, failure is a brilliant

teacher, what can we learn about failures of the last year? what do i need to atone for? let me talk about one of my most eye-catching fumbles in 2023. we had the 10 best performers in the s.a.p. 500, look at stocks that keep winning. one of these was a company called silicone valley bank which collapsed a little more than a month later, when i talked about it, it was up 40% and everything looked fine to the point where i recommended the darn thing, that was a huge and ridiculous mistake. silicon valley bank experienced an actual bankrupt, kicking off the whole mini banking crisis, i got thrashed all over the place when i make mistakes you know what? i don't care as i'm tougher myself, any one of these glasshouse critics could ever be but i think it is a teachable moment, everybody thought -- no one saw it coming, that's no excuse. if you look back to two days before the collapse of the 2023 covering stock, 22 of them had either by her hold on it with

an average price target of 292, congratulations. even he had a $90 price chart on this thing. even the most negative thought it was a $90 stock, to be sure, it's no excuse that everyone got it wrong, you don't want to show everyone, you watch it because of me and i let you down. the silicone valley bank run was one of those events that blindsided everybody, how did we get it wrong? let me tell you a story. once upon a time, silicon valley bank had a fantastic business going, it got its start as a normal regional bacon silicon valley's thanks to its footprint and its land of innovation, the bank of choice for a huge chunk of our nations startups including the founders and top executives. in the end, they were doing anything and everything for the startups and their top guys banking. even lending them money using non-publicly traded stocks as collateral. in more recent years, they made

moves expanding research and investment banking, offer the same type of customers, the stuff giving silicon valley banks relationship with tech startups, you had a lot of reason their strategy would keep paying off, for many years, it was incredibly successful, their average positives grew from 20 billion in 2013 to 48 billion in 2018 and 186 billion in 2022, their stock caught fire along with the market start -- guy rocketing from 220 17 to an all- time high of 700 and -- 63 in november 2021, in 2022, svp got collapsed, stock plummeting back to below 200 by its lows in early december, that aggressive rate hike makes clients a lot less valuable, higher rates makes it harder for startups to get funding, the market shutdowns of the more mature ones cannot come public in order to raise more cash, you don't want to be the

banker to startups, the ipo markets were frozen, i assumed that was big into the -- baked into the stock price, baked in. still, why was i so optimistic that they could go higher when i talked about a level -- a little over a month before it went under? that's because the banking crisis came from out of nowhere and this bank fell apart practically overnight right after a group of great analysts sold themselves to these guys, to get it right, there are such smart people, i thought they would have checked this out better. it seemed reasonable but it was wrong. remember, i need to get it right for you, not nathan. remember how 2023 started, in january, we got cooler inflation readings and macro numbers which led many of us to think that the fed was winning the war against inflation, we figured it might even begin cutting rates at the end of the year but i never bought into that heavens, if that were a benign scenario had unfolded,

the market would have opened up again in the first half and it would have been just fine after all, they been in the business for 40 years, i assume they know what the heck they are doing, these assumptions turned out to be flat out wrong, after an ill-fated commentary, the economic situation turned on its head, that started heating up again, valentine's day, the quickly had the feds, something that we confirm shortly before the bank run beef when he made some remarks on capitol hill, it's still a coincidence that silicon valley bank imploded two days later, it had one, but two problems, none of them are readily apparent until they smacked us in the face, first, the deposit base was too concentrated in portfolio companies, they took this money and made some very aggressive investments in longer-term government bonds, with a little extra insurance, they were rate hike's crushing bond prices,

normally it is fine, you just wait until maturity and get your principal back, big deal, when silicon valley banks venture capital gets her money overnight, this company is forced to tell -- so as per folio to use losses, in the banking business, you need both a steady source of capital and a stable bond portfolio, silicon valley bank had neither, a real bad mismatch that somehow was busted by the regulars, they needed capital badly but cannot raise it even as the positive outflows were coming fast and furious, it's time to get out. their response to the regulator seeing the bay close -- bank closed it better, that's what happened. we talked about svb positively, we were giving our best opinion with the information we had, information blessed by the regulars. shortly after him and the macroeconomic situation changed, i wish i circled back to this one and told you to

forget about it at that point but man, none of the analyst got this right either, they were not that forthcoming about the level of risk, we knew how reckless the firm was right before the bank went under, they ran their money in a way that made them and sanely vulnerable to losses, i also did not count on those who departed yelling fire in a crowded theater on twitter, will the bank run into existence? who thought they would do that, most importantly we were too cursory and chose to rely on public documents. we should have gone deeper than that because we came to learn that while the regulators were very strict and systematically important financial firms, they were a lot more lenient with banks adopting non- systematically important like svb, so many of us got silicon valley bank wrong because we were on regulators who were also wrong. they were asleep at the wheel be for the many financial crisis, they were more

aggressive once the horse left the barn, still no excuse, we need to be better than the regulators in the case of svb, we weren't. i wish we had been more pressing with this one, when i get it wrong, i always atone for it. mad money is back after the break. -unnecessary action hero ... the nemesis. -it appears that despite my sinister efforts, employees are still managing their own hr and payroll. why would you think mere humans deserve to do their own payroll? because their livelihoods depend on it? because they have bills to pay? hear me now, paycom!

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insurance from pie. or visit pieinsurance.com and get a quote. safety first, then pie insurance. so this is pickleball? it's basically tennis for babies, but for adults. it should be called wiffle tennis. pickle! yeah, aw! whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free. we are on the subject, mistakes are made, and to learn

from them, we need to talk about trust issues. sometimes i'm way too tough on management and give them too free passes, right now i want to highlight a situation where he made a lot of mistakes, believing too much in the great ceos and ability to turn around a broken company, sometimes they are in such bad shape, there is no coming back even if they bring in a tremendously talented management team, maybe a ceo can turn things around, turning it around is a process that can take years and years, not something you want to bet on out of the gate, if that is exactly what i did with footlocker long after they brought in mary dylan a ceo, she's a retail legend who transformed ultra beauty into a nationwide cosmetic powerhouse, she took over in 2013 by the time she retired in 2021, the stock was at 245% turned in short, she's a legend. footlocker hired her as a ceo in 2022, i thought she would breathe new life into a struggling base, we put her on the show in march of 2023 and

while she stressed it would take a long time, i thought she told a compelling story, she put some money where her mouth is, she had a plan to close down -- she could work it out footlocker, i knew we had to be patient and that's why we went as far as buying his one from travel trust in small positions, but we bought it. in retrospect, that was a colossal error, a disastrous mix of ignorance and arrogance on my part, i knew turning around footlocker would be a herculean task, i had so much confidence, i figured everything would be fine no matter how much it is how hard the story got, i was told how terrific ceos can impossible -- conquer impossible things, there are real-world constraints on what they can accomplish, so the great man or woman theory of investing getsy so far, it's not mary dylan's wrong, she did not mislead us, the stocks, she had not been there long enough to accomplish real combat, buying footlocker

was my scrubber, while i love to pass the blame around, and the people who run footlocker, it stops here, i said turning run footlocker would be a herculean task but even hercules never needed to turn around a flailing mall-based retailer, not a skill set, no matter how great the ceo, they cannot fight the lawsuit, that includes the merciless loss of the retail industry, fast forward to late august of 2023, locker stock was obliterated when it reported an ugly quarter in may. the august quarter made that look like child's play, companies have little slack, i told members that it would be a horrible quarter ahead of time, that turned out to be a severe understatement, i had no idea how bad this could get, my first loss would have been my best loss, footlocker had one of the worst quarters i had ever seen, not only did their sales sink 10%, their earnings plummeted 96% from the previous year and that was actually in

line number because the analyst understood that locker was awful, the relief -- the thing that hurt was that management announced a pause in its dividend payments, just a horrifying sign the company did not see anything get better anytime soon. a lot of people were in this one for the payout, footlocker yielded more than 6% going into the quarter and they lost the best reasons to tip the stock, it's a sign of confidence, dividend cut is a cut to confidence, that suggest the gist of this is different kind of confidence, that business will be awful for the foreseeable future, imagine blaming the vendor mixes as they try to diversify away from nike, one that was hurting their core lower income customers, mary dylan had outlined her turnaround plan coming off of a pretty strong holiday season, but by the summer of 23, the company saw a week start to after school season and a much more cautious consumer, as a result, footlocker had to aggressively discount it merchandise to unload inventory, they simply

competed for market share, it got to the point where footlocker was burning through cash so rapidly, they might have to tap their credit line to stay in business in response, they justifiably lost 32% of their value for good reason, it was much worse than we assumed that any potential turnaround would take a lot longer than we were prepared to wait by the time we figure that out, the stock come down so low it did not seem to be worth selling at all. the worst part of this footlocker saga is i could have seen it coming, i was blinded by mary dylan spectacular track record, it's not her fault that the stock got killed, this is the very struggle with this troubled company, it took some time to assess the full extent of the problem, i still believe she's a great ceo but i always tell you never want to own the best house in a bad neighborhood. one of our guiding rules, footlocker was not even the best house in a bad neighborhood, it was a bad house in a horrible neighborhood. they had to bring in a good

contractor but there's only so much a contractor can do when you are running a mall-based store with a lot of excess inventory, it is insanely hard to work towards a comeback, this is something i read with eagle outfitters, and other disastrous stock after it peaked in summer of 2021, where did i get that one? wrong, shame on me i thought a mall-based stock like footlocker could be anything more than a product of its environment, i simply never should have stuck my neck out no matter how much i waved to mary dylan's leadership, sometimes it's not enough, i had too much faith in a person and was too blind to what was happening. american eagle, one of my worst pics since 20 years ago. the bottom line, management matters, sure but when you bring in a new pilot on a plane, they cannot defy gravity, footlocker was a disaster waiting to happen, that come back and take an extremely long time, we never should have bought this one so early, on my part, it's an awful tray when it comes to

investing and i allowed it to cloud my judgment like a rookie word. shame on me. let's go to mikey in illinois, mike? >> thanks for taking my call. >> what's up? >> i'm looking to open a 529 plan for my two-year-old granddaughter. >> excellent. >> i wonder what your opinion is, where i should invest it, the appreciation for the next 15, 20 years. >> let's start by building up the nice position and index fund, i think what you probably want to do, i might even put maybe 35% index fund before you even start thinking of individual stocks, i think it's very conservative time and that's what you want to do, index fund is the way to go for 525 -- vinny in connecticut, vinny. >> thank you for taking my phone call, i am a member. i would like to know by buying into stock and it goes down, what percentage do i think

about selling it? >> if we take our thesis and change it, you should sell. if i say i do not like this one i'm trying to hold off for the long-term, i don't think you should be in it then i think you should sell it, that's the guideline, you know there's been a couple of stocks have said that for and that's what i stand by, or when in new york, erwin? >> how are you? >> i'm okay. brooklyn. >> not bad. >> i had a question, i know you have a lot of a wide rate of -- range of businesses and listeners and watchers, in all degrees of investment, some small investors, some medium. i have, i know you hate to have people who have more or five or six stocks in their portfolio. >> that is fine. as long as you are excited about it. >> i have 10 stocks at various prices, i don't know how to balance the portfolio. let's say -- ever since i have 10 stocks, and i have $10,000,

now it's very easy to put $1000 into each of these 10 stocks. that is something people say is an equitable rate of balance in their portfolio. >> what is the proper way? >> okay, you know i like to rank my stocks, not all stocks can be ones, ones, twos, threes if they go up, once you have to keep, two are in flux. let's pick the stocks against each other and pick the best five, that would not be a bad idea, thank you for your call and confidence, i've learned from experience, you should never allow this to cloud your judgment as i did mine, it's a rookie mistake that even seasoned professionals like me make. i'm ahead and visiting more bad calls i made from the travel trust including some stocks in terrific companies like disney and boeing, i learned from my mistakes plus my colleague, jeff will take your questions

about investing, retirement, and more. stay with cramer. [sfx: wind, rain and rolling thunder]

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>> all night, i've been highlighting my biggest mistakes, that's not to punish myself but because i believe the only way you become a better investors by acknowledging your screw ups and then learning from them. i guess there's a little bit of masochism in there too, i cannot resist. we isolate what we did wrong, we atone, we adjust, and we are all the better for it. that's the mad money way, has been since we started. as much experience as i have, as long as i have been doing

this which is basically forever, you're never too old to make the mistake of falling in love with a stock, it's one of the quickest ways for you to record portfolio -- wreck your precooked -- purple you, let me give you a love story, my bad romance with disney, not to totally mix references, the stock, demi lovato give your heart a break, that warns us at the end of the day i first met you you told me never fall in love, did i listen to demi when i came to disney? no. of course i didn't. i fell in love with disney anyway and when you fall in love with your judgment because -- your judgment goes right out the window, what happened? i made a judgment that disney's franchise who worked any amount of money between theme parks and movie properties and streaming platform, everything, i think we consider a weekend balance sheet and fumbling management could overwhelm this amazing companies franchise, we know for the travel trust and we stuck with disney through thick and thin, from early 2021 to the summer of 2023, the darn

thing lost more than half of its value, shameful. even as a situation deteriorated and they tragically worked -- obvious to me they were, i refuse to let this one go, no pride is one of my favorite stocks to the point where i have one physical share of disney hanging in my office, it gets boring, you give them disney, they will get involved in the market, whole nonsense when it comes to the losses we had, this company did a few very foolish things, they spent $71.3 million buying 21st- century fox entertainment assets, that was a massive over pay that i thought hurt there once or steene balance sheet, they promoted a theme park sel 2023 -- through november 2022. they spent a fortune building out there streaming platform, disney plus before wall street stopped based on subscriber growth, they started caring about profitability in a way -- he got a bad hand, he's not the one who made the -- in the

moment he took over the pandemic had, over time i feel like he resurrected disney's vision and improve the balance sheet, with the assistance of christine mccarthy. that seem to lose control to business with little accountability anytime something went wrong. as the situation deteriorated, and increasingly became how about unhinged from the reality? that's how it sounded on the conference calls, he assured me over and over things were getting better and he can turn the ship around like a sucker, i believe them. finally in november 2022, disney reported a visible quarter trying to spin as a huge victory, at that point i started calling for his resignation. it did not take long for the board of directors to oust him and bring back his predecessor, bob iger. far better track record. in his first few months in the job, the stock rebounded like crazy. that was a part because of -- from activists were accepted,

the problems were too difficult to transcend overnight, here's the thing. i still believe disney has got a great set of franchises, the balance sheet is fixed because they generate a ton of cash, i still need bob iger to turn things around especially now that he's working with very smart activist investors to get costs under control, i can see him making even more progress with the balance sheet so the acquisition of hulu. he bought without reaching, that is a big reason why we bought more of this one for the travel trust. it was a mistake for me to believe in disney what it was trading in the 180s. it was a shame giving bob the benefit of the doubt when he did not earn it, great companies do not rest on their laurels, they cannot overcome the fickle nature of the consumer, the purchase of fox should have made me cut and run, broken balance sheet made it a broken stock, that was a far more important than the

franchise itself, even when they brought in better management it took some time before the business started turning around and the stock and going lower for the better part of a year, here's the bottom line. no matter how fantastic a company might be, do not fall in love with its stock, unless you give them serious consideration, when the balance sheet is bad, it's like marrying someone with a horrible credit, you will be paying for that mistake for ages, do i think disney will come back? yes. that is not the question. why did i buy it so bad? because i was in love with a piece of paper. something that should never happen. mad money is back after the break. rylee! from rylee's realty! hi! this listing sounds incredible. let's check it out. says here it gets plenty of light.

and this must be the ocean view? of aruba? huh. this listing is misleading. well, when at&t says we give businesses get our best deal, on the iphone 15 pro made with titanium. we mean it. amazing. all my agents want it. says here...“inviting pool”. come on over! too inviting. only at&t gives businesses our best deals on any iphone. get iphone 15 pro on us. (♪♪) [falcon screech] [ominous background sounds] hyah! sheriff! the adversaries are back! [gasps] not again. sheriff, i got this. protecting your business from cyber attacks can be unrelenting. [triumphant adventure music plays] today's adversaries move fast. crowdstrike moves faster. crowdstrike. we stop breaches.

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there's nothing worse than getting it done right, then crushingly horrible execution. you know why? because you got frustrated and were impatient and could not wait for your thesis to play out, that's why once you consider the classic unforced error that the trust made with the stock of boeing. this was coming out of the pandemic, repeatedly, we thought 2022 would be the year of boeing after years of colossal mismanagement, we thought they get their grounded aircraft back in the sky and more important see -- this was an ironclad piece from one very special simple reason, no matter how badly boeing screwed things up at the end of the day, there's only two major manufacturers on earth, the other being airbus, when there is a booming demand, they

cannot fill all the orders and the airlines wait forever or they also buy from boeing. as long as you decipher the right price, you are bound to be a winner as the world went back to normal, we saw insane travel. the airlines need that and can pass it, eventually the earnings would go through the roof. when you take a long view, that is how it played out if you are smart about your engine point and bubbling in the spring of 2022, you would have made a bundle precisely because of the post-covid travel but we were predicting. problem is, that is not when we bought boeing for the trust, we got in much earlier and this comeback story ended up taking longer than we expected to play out, boeing continue to do what he does best, mismanagement so bad it's comical except it's hard to laugh because when this company drops the ball, plans can crash, i knew boeing was a clown show, that was the big thing in my bold thesis know about -- no matter how badly

they messed up, given they are the only two players that can meet the man in scale, i wish her the rising tide would lift them, i was right. when their stock went up in 2021 as part of the post vaccine rally, we got a nice profit, this is patiently waiting for the travel market to kick in, causing a wave of orders from the airlines, i had to plug my years, just ignore all the negative press that boeing seems to generate, that is hard to do, especially when the company in question keeps giving you reasons to sell, there's the broader macro situation becoming more favorable to my bold thesis, they kept dropping the ball even with the 737 mascot recertified into this horrific accident, it was taking them forever to register these plans and get them back in the sky by the spring of 020 through -- 2022. they gave it up, thousands of jets were still grounded even though the orders had started

coming back. just when it seemed like they have almost finished fixing the 737, the federal aviation administration may delivers on the dream meyer, the third largest commercial jet from the spring of 2021 to the december of 2022, boeing cannot actually sell them to customers. they can make a boatload selling china, china is desperate. they have got -- clone -- flown a plane in china, they need to show if they have any fealty at all or any way to demonstrate some sort of friendship with her country, boeing is the traditional way of our trading partners to send us in all of branch, it's a bizarre company, it tries to get congressional districts, it's also a defense contractor so grading jobs for congress is how they keep order flowing, china never seem to fall, the orders did not come, another source of frustration, if i stuck around until june of

2023, the chinese airline thesis paid off as boeing made extremely optimistic noise, i did not have the fortitude to wait it out. i just could not take the house of pain in january 2022, boeing reported a hideous quarter, skyrocketing labor cost, nasty cost overs, the company taking big charges to boot and therefore put in another top and bottom line with one $.5 billion charge from the delay of the 777x, even their air force one contract messed up, huge cost, at this point, boeing had huge credibility programs. what does management do to fix things? decide to move the headquarters to right outside washington, d.c., that's not a solution, finally i just gave up and cannot take it anymore, the and the strip of bad news and botched quarters was torture to me, so we sold boeing for the travel trust in the spring of 2022 right when we should have been buying it at discounted prices, what did i do wrong?

i did not have the patience or the pain tolerance to stick with my original thesis which was dead right all along, we were not going for the travel trust, that was -- the whole idea was no matter how badly these guys drop the ball, there's only two companies, sure enough, we sold our final shares at $121. mid-may of 2022 which is only a few points above or the stock would be at the bottom if we stuck around, would have seen the stock shoot above $200 as the bold thesis played out perfectly. the lesson here, if you believe in your own thesis, you cannot let naysayers scare you, i knew boeing was the second best playmaker in the world and was flooded with them and because of aircraft, did i miss a spectacular rally because i did not trust my own work and cannot take it? here's the bottom line, the moral of the boeing story is simple if you have a thesis that looks like it will play out, don't let it's unrelated, negatives scare you away, boeing

hideous performance in the first half of 2022 was not a reason to sell, it was a reason to buy but only if you had the fortitude to stick with it and i did -- didn't. stick with me. -- stick with cramer.

i see my favorite part of the show is answering questions directly from you, i'm bringing in jeff and his partner, he will help me answer some of your most burning questions. for those of you who are a part of the investing club, he will need no introduction, for those of you who are not members, i hope you will be soon, i would say that jeff and his insights have helped me into the -- do a great job on mad money viewers, i think i need the union and yang. you are starting me up with a question from pete in michigan who asks regarding

rules make money embarrassment, how does this apply to the owner don't trade it, this is a great question because a lot of times when we have a bad day for nvidia, apple, with titanium heating, it challenges the thesis. what i come back and say, it is okay to have a cheat day, this is what i have been working on, yes, we have been pigs theoretically an apple and nvidia. what we find is that those stocks are not piggish if we look at the lower numbers. looks like nvidia is expensive, it turns out it is cheap and justifies owning it, does it justify keeping this much, that is a subjective question. i have often felt that it is okay to say all right, we say owner don't trade it, you can trim. i am reluctant because these are invest stocks. >> what i would add is that we

do look to trim, it's at a certain point on when the stock becomes too large as a percentage of the per folio due to that outperformance. it we usually have around 33 stocks in the portfolio. we had it with nvidia. when one of those, apple just to pick on apple, whenever it gets too large as a percentage of the per folio, we trim it back because it had a good run. >> that's what we saw -- does it deviate? it's a nice -- way we are pushing it, a question from mike in florida, i've been doing a lot of profit-taking at 50% cash making under 5% cash, how do i get back in and what level should i -- start at right now? here's the way i look at it. you can go back am not saying right now, we have the situations where interest rates have spiked. when the market is very oversold on our oscillator which we have a special deal with with -- for our subs, you need to pick but the market must be down.

we don't pick hide. we pick low. that is why even you have 50% of your money in cash, i'm not saying go take that part of the market, i'm saying gingerly apply. let's take a question from bennett who wants to know what is the maximum exposure one should have to any sector or stock and a well diversified per folio, we don't want more than say 10% and one stock, the sectors are little harder. >> you could always just try and follow the s&p 500 but be overweight, underweight is paying off your conviction levels in those stocks within those sectors, i will give you a good example. entering 2023, we did not own any real estate or utility stocks, we listen to the fed and the fed said we needed to raise rates, keep rates higher for longer, we know those stocks tend to underperform as rates go higher. of course you can always do some mixing and matching.

you can just track the index. >> precisely, i hope all this helped you, we tried to do of course much more than this for the club but these are the questions we answer every day, we use stocks as more of the teaching moment. see you next time. . right now on last call, from bad to worse, a top safety official making a shocking new claim about boeing. the first currency crisis blamed on crypto. a wild story unfolding with one detained american. oil spiking ukrainian attacks against refineries we will show you what comes next. one bank may be jumping in. plus, end of the road? a once highflying ev maker nosediving after hours, and