of 60 minutes on cnbc. i'm steve kroft. thanks for joining us. i'm jim cramer and welcome to my world. >> you need to get in the game. >> firms are going to go out of business and he's nuts. they're nuts. they know nothing. i always like to say there's a bull market somewhere. "mad money" you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. my job is not to just entertain, but to educate, call me, 1-800-743-cnbc. we are not used to this. we are not accustomed to markets that let you in and allow you to make money practically on a daily basis. markets that permit you to make a decent profit buying companies that are doing well with good profits going forward. that is what i found myself thinking as we started lower in

the morning and looking ugly and then blossomed over the course of the day into a decent session. dow rallied and nasdaq advanced .07. this action is different from the stock market we have had from the last 12 years, it's worth discussing what is going on. if you have a bull market happening, either people do not recognize the market for what it is, because they have never really seen a bull, or too skeptical or they forgot what a bull market looks like because it's been so long since we had one. i'm old enough to have seen all kinds of markets. i lived through rallies that were broad based and gave us fantastic returns, not snap back craziness and whip saw moves. understand, i'm not saying

everything is right in this market. transports failed to go higher. copper dropped today. i've been saying that i need it to go higher, things are not perfect. but what i'm saying is is this tape, meaning the day-to-day action, does have a lot in common with the bull markets of old. let me give you the anatomy of a bull. bull markets are built on a foundation of skepticism and disbelief. every bull market has been scoffed at and they stay away and hide in other asset classes like treasuries. lately the volume is shockingly low. the participation in this market seems almost nil, you have to search far and wide for someone that says i like this market. i hear more about a bubble in stocks than a bull market. it's going to trample all the

skeptical short sellers. stocks are acting rationally. this morning, two good quarters for coca-cola and yum brands, both rallied after reporting. before you say of course they rallied, consider that last year's stocks rarely did what they were supposed to do. the stocks went down regardless of how good the reports were. they could not buck the tide or we found a fault in line and in this market we take good news at face value. third, in other markets, stocks that disappoint, they go down, and they stay down. not in this market. classics sign we have a bull on our hands. disappointers, they tend to go down and wait a little and spring back up and we struggle to remember what was wrong with them. think about it.

goldman sachs missed horribly right up in the corner of the new york times yet the stock is up more than 20 points. alcoa, hideous quarter, 20%, fall. consider the worst miss, chipotle, they just got crushed. upon closer review, we threw the flag, not unlike belichick, he threw it wrong, never mind. it was a super quarter, the bears were stuffed into burritos. anyway, bull markets actually let you in, bear markets suck you in. perfect example, another good day where the market opens down and oh, greece. unlike 2011 that was fair warning of a slaughter ahead, it's a good opportunity to get

in on a better pryce. this year when you buy low, you get a good price. fourth in the good markets in the '80s, they weathered levels of resistance. intel, above 25, did you see mcdonald's, over 100, walmart has cleared 60 at last. these have been containment levels forever, and no longer. fifth, the good stocks do not seem to quit. we got stocks that just seem at will, destined to go higher seems like every day, it's a day that apple seems to go up every day, starbucks, well known names

that tack on point after point. finally this market is not zero sum. the problem with almost all the rallies is they have been narrow, almost the entire run was in pure commodity stocks, china plays, soft goods and financials they sat out, and tech could not get out of its own way. tech stocks rallied nicely across the board and the financials and retailers tore up the joint and so did the retail stocks. ag stocks worked higher and so do the consumers of the ags did well. we have not sustained a rally since the 1990s, a move where the money can did not come out of peter's portfolio to pay for paul's, but that is what happened in the 1980s, we saw the same thing. after a moldy decade of a dead market then we saw every different stock doing well. call it a bubble, call it a light volume on short squeeze, i don't care.

discount it as a weird bounce off of year-end lows. say what you want, but it looks like the bull that brought us out of the dow 1,000. sure the dow spiked higher in the last decade but that was an unsustainable run. but this one, maybe it has the makings of those incredibly bullish markets of yore that made people believe there were good stocks to save and invest and not just rent and yes ultimately scorn, let's go to dave in ohio. what is up dave? >> i'm retired and i'm very concerned about the increasing tensions between iran and israel and the potential for military conflict, higher oil prices and an economic downturn. should i move out of equities and into short term bonds? >> you have just hit on the two

worries articulated this morning on my other show. i'm worried about iran and a war with israel and i'm worried that gasoline is going above $4. these are worries other people have. if one of them happens the market will get hit. you can raise some cash because of it because those are the two worries. they will indeed, even them, perhaps be buying opportunities in the end. is this a bear market in a bull market's clothing? i think so. call it what you want but i've got to side with the bulls. mad money will be right back. >> coming up, technical time. could europe's financial crisis and escalating tensions in the middle east ramp-up a bull market here at home? cramer is bonding the technicals and fundamentals to find you the way to play it on an all-new edition of off the charts. and later, at your request to be all this week homage and is taking his inbox, voicemail and quicker to answer your best questions on the air.

tonight, ready to ride the rails? all aboard. conductor cramer decides which stocks can take your portfolio full steam ahead. plus, early valentine. this medical device company makes the world's smallest heart pump, giving patients who were previously denied heart surgery on other option. don't miss cramer's exclusive with the ceo just ahead. all coming up on mad money. hyundai genesis.

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has the best performing asset class of 2011 and for that matter multiple years before that finally run out of steam? ever since the new year began, we have been watching 2011's losers become huge winners in 2012.

now it seems like the biggest winner from last year could be ready to give up the ghost. so what was last year's best performing asset class? not stocks, they were flat for the year, and not gold, but it did pretty well, nearly 10% in 2011. no, the best place to put your money last year, some people would say hide your money, was in united states treasuries, yes. long-term treasury bonds. just take a look at the ishares barclay's 20 year treasuries etf, also known as the tlt, it's the stock that appreciates when treasury bonds rally in price and interest rates go down, and drops when treasuries decline in price and interest rates go higher. prices and rates trade

inversely, sorry i had to give you all that. the tlt was up a staggering 30% last year and gave you closer to a 34% return when you factor in the coupon payments. it's normally a safe place for your money, bonds, but we do not think of them delivering the massive capital appreciation that so many pundits came on these shows and told you were a bad bet. 30% return is not what you expect from a u.s. government backed piece of paper. now it's looking to me, and others, like bonds may have topped. like this terrific move at last is over, at least according to tim collins, my brilliant colleague at thestreet.com which is why tonight we are going off the charts to understand why last year's rally in treasuries

might turn out to be a rout. if you bet against long-term treasuries last year you were made to look a fool. he thinks that they are in for a vicious decline. many of you are in bonds. that is the predominant asset class that many people have gotten into. check out the daily chart of the tlt, again, remember this is the i-shares things. there's a lot going on here i know, but do not be intimidated by this technical mumbo-jumbo. first, take a look at the relative strength index. rsi. okay. it's the top. okay. this this is a directional momentum indicator that measures the strength of the trend, and look, it's been trending down for a long time, making a

consistent series of lower highs. going all the way back to august. which suggests the momentum in treasuries could be flagging. during that same period, it has been making flat lows, creating a floor of support under this indicator, and if it falls through that floor, which it looks like it may be about to do. talk about a major flag, the bonds could be toast. same thing, with what is happening with the force index, a new indicator with one that uses price and indicates when they will change direction. it has been making lower highs. trending down in a way that to collins, tlt could be next. look at this cleaned up version of the daily chart so we can

focus on the tlt etf. the real warning signs are in the rsi and the forced index in the bottom. the price action of the bonds has not been pretty either. we see here, look at this, the tlt has a ceiling of 118 and all above where the tlt went out at 127. that is resistance and it makes it tough for them to move they have to crash through barrier after barrier, at the same time, there are fewer and fewer levels of support underneath the tlt, and they are spread much further apart, so if it drops through one, it's a long way to go before the next support level breaks in. where the tlt is right now is

the last floor. if it drops beneath that level, the floor is not until 112 and then another one at 108, collins would short the tlt, forget another close at 116, because people follow the charts i'm telling you will see a water fall, a land slide if it takes the fall. this one has to do with volume. these bars on the left side of the chart, they measure how many volume there has been in the given price range. you see below 114 it drops off in a major way. it's devoid of big volume which means trips through that area can happen quickly, both on the way up and on the way down. another reason that collins thinks that the tlt breaks, it will break down hard. consider the trap door that elton john went through in that super bowl ad.

you can see the same dilemma more clearly on the weekly chart. take a look. there are two resistance levels at 123 and 119. see? and the wavering floor of support at 116. and then after that floor, there's a long fall down to 108 or even 102 before the tlt finds another support. it will go down and then bounce a bit. but the problem is the bottom in the trix. when it comes to the charts, trix are not for kids. this is a leading momentum indicator that is used to figure out when a security is going to change direction. trix just had a bearish cross over and the last time it happened in 2010, it predicted a 10% decline in the tlt.

i'm with him, the bears are making the playoffs in this chart. one more reason to fear treasury bonds is the volatility index or the vix, take a look at the tlt and the vix together. last year these two things were joined at the hip, they practically traded in lock step. here, right, vix, vix, and the tlt, they are like the same chart. which makes a lot of sense because the vix is also known as the fear index and when investors are afraid, they go and hide in treasuries, but the tlt and vix diverge at the end of the year.

collins feels like something has to give, i want you to think like wylie coyote, and the vix is dropped over here, way too low. where should bonds be? yeah, in any scenario, when we have a war between iran and israel, it's more sense to do buy the vix, if you feel, this is wrong, go by the vix, i think sell the tlt, i think that collins is dead right here. with the risk of cascading european bank failures off the table, treasury bonds are dead money, at best. you do not sell bonds when an economy is heating up. you sell them. this is what the charts are telling me. these charts worry me. collins could be right. and the charts indicate that long-term treasuries could be about to become the biggest loser in 2012. and i have to agree with him on

the fundamentals. time to ring the register on the bonds. you want yield, don't look at bonds, look to stocks, many have good yield, and at this point, they have got a lot less risk then owning the tlt. next up i'll try you to save you more money. >> announcer: coming up at your request, jim is checking his inbox, voicemail and twitter to the air, tonight, ready to ride answer your best questions on the air, tonight, ready to ride the rails some all board, conductor cramer decides which stocks with take your portfolio full steam ahead. and this company makes the world's smallest heart pump, giving patients another option, do not miss exclusive ahead coming up on "mad money".

welcome to request week here on "mad money," this is the single most interactive show on earth.

tonight's tweet is from bovey23, he asks, jim, union pacific or norfolk souther? give me that? by the way, we are getting so many amazing ideas and we can't get to all of them. but you can see the incoming tweets from all over cramerica in the cnbc twitter. so keep them coming,@jimcramer #madtweets. now back to the excellent question. not just because these rails are not like the reading and the pennsy, both worth the same price in monopoly when i always threw the board at my sister when i lost, which is why she always let me win. i'm a fan of the railroads because they benefit from the acceleration of the economy, something that is becoming

obvious, even to the skeptics except for the democrats and republicans and ben bernanke. even before things started getting better here in america, i liked the railroad business for the simple fact that it is a big slap happy oligopoly with a handful of players that are not in competition with each other. they divided the country. which is better? norfolk southern or union pacific? these are the questions that we used to ask. pitting them against each other to see who is superior. i've been doing this exercise for you. we are all one big hedge fund together here. now, union pacific and norfolk southern are both major american railroads. neither of these is like the

short line, but in the end, there can be only one winner. that is because making these kinds of comparative decisions, figuring out that x is better than y, this is what they do at hedge funds, this is what i want you to do at home. this is how to become a great stock picker. in 2012, we have a stock picker's market where companies trade on their individual merits. which means you have to learn how to pick stocks. not etf or s&p 500, stocks. union pacific is now in striking distance of the 52 week high. norfolk southern has rallied 20% and more than six points off its high. they have the same 16% long-term growth rate, which means on a peg ratio, norfolk southern is

cheaper, we could stop there and say buy norfolk southern. so do we go with the leader or laggard? as is often the case, it's actually worth it to pay a bit higher for the best of breed. buy union pacific over norfolk southern. here is the reasons, first and foremost the rails began a big repricing for new contracts. cycle starting in 2003. we are now in the late innings of this story. it not quite over and union pacific has the most upside from repricing going forward, that's the key metric in the rail business. to understand what is happening here, we need to go to the way back machine when the railroads were federally regulated and the government decided how much they

could charge for shipping. they were deregulated but did not change their pricing model. it caused rates to fall from 1980 through 2003. now the rates have been rising, and it's led to a railroad growth in the last decade and gave you multiple year gains. union pacific has rallied 375% over the last nine years and it's not finished. union pacific has 8% of their contracts up for repricing and that is on top of 4% of their contracts that were just repriced. that is how you get upside surprises. norfolk southern, 3% of their contracts are up for repricing. second, when it comes to the

rails, coal is king. that is a serious problem given that natural gas prices have gotten so cheap here in america. nat gas is giving coal a run for its money. not to mention a crack down on coal burning utilities that is sure to happen if obama is re-elected. companies are switching right now from coal to gas, i like union pacific because they get a portion of their profits from coal and the coal that is mined out west is cleaner than the coal from the eastern part of the country where norfolk southern operates. a lot of bad here. union pacific has you up side away from coal with 8% of the revenues coming from autos, and market is on fire, 15% from

chemicals, 17% from industrial products and 18% from agriculture, you see the numbers? we will plant more stuff than the last 25 years, and they are in the mobile business, starting to improve because of the accelerating economy and the turn in housing. third, union pacific had a much better quarter than norfolk southern. u and p delivered a fabulous 18% earnings beat, stronger than expected revenues and 15.8% pricing and accelerated revenue growth. we love that. this was a high quality beat. norfolk southern reported an operational miss on january 24th and the earnings came in better than expected.

their apples to apples was a five cent miss. so much for that p/e analysis. norfolk southern does not disclose core pricing. union pacific's key metric is stronger. and finally union pacific has fantastic management and a good good balance sheet. norfolk southern is better, this is one of those cases where you get what you pay for, bottom line, when it comes to the railroads, there no question about it, union pacific is a better company than norfolk southern with a stronger business and more repricing catalysts ahead and it's the better stock, trading at a small premium to norfolk southern. and while i'm telling you both rails can work their way higher, if you landed on norfolk

southern you would save your powder but if you landed on union pacific, you would mortgage the board walk to buy it. hey, how about sidney in virginia. sidney? >> thank you for helping the small time investor. >> that is what this show is dedicated to. all the hedge funds watch it. they have to. go ahead. >> i have a concern about csx, they have dropped for the last two days, what happened here? is it mismanagement or the economy? >> it's not management because michael ward runs it, they had change at the top here. but it's a coal based railroad. meaning the coal is a predominant cargo that will determine the fate of csx and coal is -- well it's beating the heck out of it because of natural gas. on the conference calls they say

that natural gas this low is bad for the rails. i have on go to lee in california. >> big booyah from the high desert. >> i used to go there to watch the sun go down. >> jb hunt, last week, they had record revenue earnings for 2011, what is the effect on the stock going to be and where do you see the stock going? >> by the way, the transports did not act well today, and that is very worrisome. i think jb hunt goes higher. and i think the trucking companies are terrific. and don't forget the truck engine companies. i do not see anything slowing down union pacific, no. it will keep moving, i want to thank my buddy, and pal, friend at bovey23, who nailed this question. keep the requests coming and don't forget, we will show them

on the twicker. stay with cramer. >> coming up the clock the ticking, find out how to fire away at cramer on the lightning round. and later, early valentine? this medical device company makes the world's smallest heart pump, giving patients denied heart surgery another option. do not miss the exclusive with the ceo of abiomed.

it is time for the lightning round. are you ready, skee-daddy? the lightning round, we will start with john in pennsylvania. john? >> caller: jim. >> what is on your mind? >> caller: well, since the beginning of the year, where i first bought it for the giant dividend this stock made a nice

climb, i want to know if i can buy more near the 52-week high and do you see the dividend continuing in the future? it's cedar fair. >> it's up 27 and we recommend it several times. it can go higher. cody in michigan. >> caller: booyah. on the friday's job report it was better than expected, where do you think that paychex is going? >> i think automatic data did not have good things to say, they have been saying they are not that great, but when they go well, it will soar. >> caller: jim you are a great teacher and we love your show >> thank you. >> caller: i have a question about a company called one oak, and it the symbol is oke.

>> pristine, terrific company has over shot the yield, went up so much that the yield is not that high anymore. i still want to own the company. i would like it to come down a little bit more before i would pull the trigger. jim in california, jim? >> caller: booyah cramer, i'm in the house of pain with one of portfolio items. >> that is an apartment complex of pain and until they report two good quarters they are in the major penalty box. i'm not kidding. i mean they are like, wow, wow. i mean, they give it a couple quarters. i'm stunned because interlink is one of the worst companies we have had on the show. jay in california. >> caller: booyah, cramer, from sunny san diego. >> i love san diego, i'm coming to town soon. what is up. >> caller: you came in high on

carrizo oil. where do you stand now? >> i believe in the company, i feel like we have to be more oily which is eog, my new favorite. ryan in florida? >> caller: booyah, jim. how are you this evening? >> what is going on. >> caller: a quick question, a company with a nice run up in the past few months, and a video game scheduled to come out, take two interactive. >> it's the best in the gaming stocks right now, electronic arts is underneath that. take two is the real deal and that is the conclusion of the lightning round. >> the lightning round is sponsored by td ameritrade. >> let's go to kentucky.

here is a big las vegas! >> a big booyah, boston, nashville, michigan. let cramer help you channel yours, "mad money" with jim cramer, weeknights. in what passes for common sense. used to be we socked money away and expected it to grow. then the world changed... and the common sense of retirement planning became anything but common. fortunately, td ameritrade's investment consultants can help you build a plan that fits your life. take control by opening a new account or rolling over an old 401(k) today, and we'll throw in up to $600. how's that for common sense? without the stuff that we make here, you wouldn't be able to walk in your house and flip on your lights.

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with valentine's day around the corner, we have to answer the age old question, how do you mend a broken heart, there's a small, speculative medical device company that knows the answer. abiomed. heart disease is a huge problem in this country. it not just lethal, it's expensive. that is one of the reasons that cardiologists are always looking cardiologists are always looking for cost effective solutions to treat it before having to do an operation. here is the impella, you'll not believe it when you see it. it is replacing a 40-year-old

technology called the intra-aortic balloon pump. which is used about 124,000 times a year in the country. if abiomed can convert half of the patients to their own product, they have an opportunity. the knock on the stock, people say it's a one trick pony but the company is working on different items in the pipeline. plus, this is really cool, company sells the world's first completely self contained artificial replacement heart, but that not the story that is driving the stock. now the company reported a blowout quarter on friday, analysts were expecting a one cent loss. impella sales up 31% and stock has run up 70% from 12 months ago.

it's also expensive. to put it in perspective, the average takeover target comes out at five times sales. questions have had abiomed down this very morning. has the stock gotten ahead of itself and does it have room to run. i'm telling you because when you see it, you'll want to buy the stock. let talk to the chairman and ceo to find out where the company is headed. welcome to "mad money." >> thank you for having me. >> first of all, we got it and we know there's a research firm coming out and saying abiomed, be very careful because the insurance companies will cut back how much they reimburse for it. that was a rumor, it's not true? >> no, it not true, we have great reimbursement from the government because the product helps save lives and the insurance companies are covering it for emergency patients. one thing that is different is

heart recovery will thrive in today's health care, people want to keep their hearts and payers and providers want to find ways to get better outcomes not only from the hospital but out to 90 days and we show a 56% reduction in adverse events when they leave the hospital. >> show it to us. >> it's the world's smallest heart pump. it can be put through a small hole in the leg to get to the heart. procedures today, patients are riskier and sicker and the procedures are less invasive. you can put it through a small hole in the leg it will sit in the left ventricle and it will pump 2.5 to 5 liters. here is the motor and this is the world's smallest heart pump, right here in this key chain, it's spinning at 50,000 revolutions per minute. >> can we see it? it's really tiny. >> it helps the heart rest and recover or provides protection.

there's two types patients, one that has a bad heart and is turned down for surgery, bob is in the hospital, the cardiologist puts it in and does the procedure and the patient as we see in the study, their heart gets better and they improve and on the emergency patients we have folks like a firefighter that has a massive heart attack, getting cpr, they use the pump to help rest his heart and he gets better and he is back with his own heart, he did not have to get a transplant or surgery. this is what we are focused on. heart recovery is very special. >> how many hospitals is it in? >> we are in 605 hospitals. we got approval in 2008. we have 72 patents. we have no debt and we have 70 million in cash. so we are getting focused on changing the standard of care. >> if i walked into a standard hospital with an emergency

procedure, i don't know how many hospitals there are in the country. can you request it or does the doctor say it, i do not want that balloon, it's on and off, it doesn't do the job? >> we just made the medical guidelines in november. so we expect to see this as a positive. it's an important thing, and we have a lot of clinical data coming. this is in the early innings of our ramp. >> it saves money, the government will want it and you have data that said that 90 days out is better. >> and it's cost effective and patients get to keep their own heart. >> i understand why the stock is moving. the ceo of abiomed, the stock is up a lot but this is the kind of thing that is like intuitive surgical, stay with cr .

is the market fixed? is it a game that is rigged against you? i don't think so. you can buy plenty of companies that are doing fabulous. not one of them is a mugs game, they are not rigged in the least. but some parts of the market do seem shady. and i understand the revulsion people feel towards wall street.

i talked with people about the small piece of stock will be offered. does the public understand that that little piece is a flood that is coming their way? it's like a blue light special drawing you into the store, when in reality it can be dribbled out over time. the sec has to come to terms with these offerings. it gets people excited because they do not understand that there's a ton of additional stock that will be offered in the near future. if you really want to see outrageous, check out the indictment of three credit suisse traders that was filed in new york, alleging fraudulent valuation of bonds to get bonuses that americans can only dream about.

they were creating false evaluations to boost their pay. simply by claiming the mortgage bonds they owned were worth far more than what the market said they were worth. armed with these sky high and phony valuations the traders were able on prove that they made millions for the firm when the profits were a loser. they were caught on tape, making up prices, it makes for fascinating and disgusting reading. my blood wanted to boil when i heard this because the home mortgage market was falling apart when these crooks were trying to say their mortgage portfolio was holding up terrifically. is it all rigged? not if you stick with clean companies that support good balance sheets, but for the rest, let's say, approach it with that age old latin mantra, buyer beware, stick with cramer.

>> okay, disney and panera cooling off, but sometimes you have to power higher. buffalo wild wings on fire, just