that makes the beer. so without you there'd be no bud? that's right. well, we like you. [ laughter ] ♪ 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, and i promise -- "mad money," you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends, i'm just trying to save you some money. my job is not just to entertain you but to educate and teach. so call me at 1-800-743-cnbc. the big benchmarks keep getting trumped. first we breached dow 13,000, and today, how about this? broke nasdaq 3,000, where the averages pulled back in the afternoon, dow closing down 53

points, s&p giving up .47%, nasdaq will be shrinking to .67%. but the assaults on these old levels undeniably powerful. i don't think it's exhausted itself, just as we could use a pause to catch our breath. and maybe this is it. the skepticism surges seems as mighty as the advances themselves. it appears to me if you chatter about these assaults, you must immediately couch it in the context of bubbles, or you'll be dismissed as a cheerleader. as in, well, it's got to be a bubble, doesn't it? it's got to be a bubble now that we're back to nasdaq 3,000. isn't dow 13,000 an invitation to being something bubble licious. irrational exuberance? alan greenspan right before the monumental doubling!

so is all of this bubble speak, is it merited? or has skepticism become so thick as to be, well, too thick? can we be so skeptical we descend into being cynical, or corrosive, or perhaps irrationally negative. i don't like the market today. i didn't like the way it acted, didn't like the plunge in gold. that's been a harbinger of european weakness, i didn't like the decline in europe. i don't like the transports going down seemingly bad today. i do see lots of problems that could see the market lower short-term. including an israel/iran missile crisis that could end worse than our own cuban missile crisis. still, i come back to thinking we have become irrationally unexuberant. i've got to do more than that. i must show you the differences between now and last time we were at these levels and we should've had the wand out last time. so you understand why this

generation's current bubble heads are full of hot air. all right. first let's tackle the dow. all right? let's deal with it. in 2008, we traded above 13,000, the excitement, it was palpable, we'd be giggling back then! we figured to make another run at dow 14,000. the problem was we were doing it all wrong. in 2008, we were moving up in large part because of terrific growth away from this country. bric, brazil, russia, india, china, embracing commodity stocks, and worst of all, we believed the banking system was terra firma when it was quick sand. we thought it was solid despite the peak in housing because we had no idea how widespread the fraud and recklessness were in that industry. $14 trillion worth of mortgages suddenly in question. yeah, those are the real numbers. we've been brainwashed into believing that houses never decreased in value, particularly over the long-term. didn't we all think that?

man oh man were we wrong. you want to know just how wrong the market was in 2008? how about a pair of 44s to paint the picture? yeah. consider it. just when housing swoon was beginning, bank of america which would become the largest private owner of houses in this country traded at, are you ready? $44. at the same time, alcoa, the ultimate brick in construction play also stood at $44. you could buy a lot of rentals for that. can you imagine? now bank of america can't seem to go beyond much of $8, right? people are thrilled to see alcoa north of $10. talk about what a difference four years makes. plenty of stocks have done nothing over that period, including many of the packaged goods plays and the drug names procter, merck, others have declined substantially, down by 50% and 24% respectively. i think the stocks have been clobbered deserve to be clobbered. bank of america, i'm calling it a shell of its former self, crushed by the worst acquisition

of all time, the countrywide deal. alcoa suffered from a glut in aluminum including a surfeit of the stuff in china. hewlett-packard's made so many mistakes in the interim i can't even count them. there are plenty of stocks that, well, say the vast majority. the vast majority of stocks in the dow seem wrong to me, meaning they're too cheap now, not too expensive, too cheap versus they were back where they were in 2008. intel and microsoft have been treading water. does anyone believe they aren't substantially better off than they were then? they have better products, more cash, more high yields. good dividends. same with the drug stocks. their prospects four years ago reflected many drugs coming off patent. these companies have dealt with patent cliffs by developing niche products and boosting their dividends. their balance sheets are perfect. all of these stocks were expensive back then but now seem dirt cheap to me. that's hardly the stuff that, yeah, bubbles are made of.

is at&t a bubble? come on, it traded in the 30s back then. now it can't even seem to hold 30 much even as the company solidified its leadership position with its apple, and you know, i've got to tell you, along with verizon, think about it, they have pulled away from all the competitors. at&t really worth substantially less than it was in 2008 with that apple leadership? that's wrong. no matter how many times i go over these 30 stocks of the dow and the hewlett-packard and bank of america, i keep coming back with the idea that almost all of these companies are doing much better than they were in 2008. no bubbles here. they have much more cash, really beautiful balance sheets, far more bountiful yields. i can argue, a housing recovery, like what the stock is saying. you see them today? we could see bank of america go up dramatically. hewlett-packard and alcoa, i'm not going there. i see hewlett-packard going much lower.

the chinese have to blink if alcoa's going to rally, expanding the aluminum capacity will be a tough concept for 2012. those are two stocks out of the 30 i'm worried about. the dow has to go higher before it seems ripe where it was four years ago. yeah, we've got to go up substantially before i feel like we're as vulnerable as we were four years ago. nasdaq, that's an even simpler exercise. the last time we were at these levels 12 years ago, we were way down from the highs already. but we were nowhere near the lows. the nasdaq back then was an entirely different animal. dot coms, telco infrastructure and semiconductor plays, almost all were about to plummet. true bubbles, no earnings or we're headed in that direction fast. many of them had no revenues to speak of. now you can argue right upfront that the nasdaq's currently being powered by the one fifth of the index that is apple and maybe that seems unfair to you. but just as we can't strip the index back then of what was totally worthless, how can we

dismiss apple as a big hype job? at the height of the nasdaq we had many stocks selling at 50, 60, 70 times earnings. and those earnings were about to be chimerical or to disappear. the last time we were at these benchmarks we breached today however briefly, the stocks were wildly overvalued versus this time. and wildly overvalued versus the future. twelve years ago the nasdaq -- >> the house of pain. >> four years ago, the dow jones faced the beginning of a worldwide economic collapse, now we've come back to those levels for most of the companies in the index, the future's brighter than the past. here's the bottom line, me, look, we may at some you do want to say to the averages are now in the quintessential bubble mode, probably because we are all defensive and gun shy. we should have been calling bubble back then.

now we're facing a more certain economic time for the dow and we have tech companies with real earnings, real dividends leading the way back to the nasdaq 3,000 benchmark. i say you know what? this is the opposite of a bubble! how about at last a realistic appraisal of the future that may be too negative based on the historically low price to earnings multiples for so many stocks and lack of competition from so-called fixed income securities which i think represent the real bubble of the 21st century to date. yeah, if you fear overvaluation, look over at that bond aisle, that's what's outrageously expensive. stocks, let's just say that while they can easily go down a little bit from here, they are much cheaper than when we hit these levels last time. and we should stop being so caught up in the notion that things are just as fragile and overvalued as they were the last time we saw these big index prices. in other words, i say let's put the bubble out of the picture. i'm taking phone calls.

i'm going to dave in pennsylvania. dave? >> hey, jim. a big phillies spring training boo-yah from bucks county, pennsylvania. >> how can i help? >> caller: well, i've got a leap question for a leap year. >> all right. >> caller: given the rest of the market right now, instead of buying individual stocks, i've recently bought some leaps that expire in a couple of years and are about 15% to 20% below strike. i'd like to buy some more. do you think this is a good strategy? and if so, how deep in the money would you go? and could you give me a couple of names or industries this strategy could work for? >> you can use deep in the money calls, that's a stock replacement strategy for the likes of apple. remember, i'm a dividend guy. i want dividends, people to reinvest the dividends. that's how we've made a lot of money on this show and that's what i'm sticking by and the leap philosophy is antithetical. >> caller: spring training

boo-yah from huntington valley. >> holy cow, another guy from bucks county, and we're basically turned into kyw tv, isn't it? let's see who's in the booth tonight. okay. go ahead. >> caller: anything less than a world series championship is a disappointment this year. >> anything less than dow 14,000 is a disappointment this year, steve, right back at you. >> caller: bigger companies with commodity pressures having trouble holding market share and suffering slower growth potential, what makes you think tech companies like cisco and intel can pull a rabbit out of their hat and grow? >> this is a great question. i'm not going to put cisco in that category. they've got a great balance sheet. finisar after the close, terrible. i like american tower for cell phone and telco spend. but intel, it's the valuation, steve. microsoft, it's the valuation. dell, it's the valuation. dell barely went down, it's the dividends, it's the buybacks,

it's the cash flow. it's inexpensive versus last time. i'm popping the tiny bubbles right here, right now, or at least the bubble talk. "mad money" will be right back. coming up -- the other pipeline. while the world focuses on keystone, there's another pipeline that could be about to change everything. stick around, cramer's drilling down to ease your pain at the pump with the ceo of enbridge next. and later, what the heck? after the government cuts defense spending, one major contractor hits new 52-week highs. cramer's in the trenches, find out why all coming up on "mad money." [ female announcer ] feeling that flu all over your body?

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on a nasty day like this

one, i like to circle the wagons around my favorite long-term themes. big-picture trends like the incredible oil rush happening now in many parts of north america. i'm like a broken record on this story because it's a game-changer and people have a lot of trouble comprehending the scale of the opportunity. because it's so darn big, fuels, for many believe it must because it involves fossil fuels, for many believe it must be stopped. by 2017 the larger producer of oil could be the united states. not just the saudi arabia of natural gas or coal, we're becoming the saudi arabia of oil and gas too. you know i like many of the pipeline stocks for the bountiful dividends. this is also turning into a major growth area, which is why it's also worth considering a high-quality growth pipeline play, like enb for you home gamers, company operates the world's longest crude oil and liquids pipeline system as well as owning canada's largest gas

distribution network in ontario. primarily located in texas. only gives you a 2.9% yield, which is much smaller than what you get from kinder morgan or from an energy transfer partners, names at my charitable trust owns. the company's about building out new pipe. it therefore gives you a greater opportunity for capital appreciation as well as capital preservation. goldman downgraded it today because the stock has moved too much. that's a good reason why the yield's small. should be able to grow at a 10% annual clip through 2015. thanks to the numerous new projects across north america. and over time, that growth means they'll be able to keep increasing the payout like they've done for the last 16 consecutive years. stocks giving us an excellent 33.3% gain including dividends, ever since i got behind it in march of last year, s&p up 4.5% over that same period. i believe the outperformance will continue. let's check in with patrick daniel, the unfortunately soon to be retired ceo of enbridge, probably the most knowledgeable oil and pipeline man on the continent.

find out more on how the company's doing. welcome back to "mad money." >> thanks, jim. it's great to be back. >> well, i'm sorry to see you retire. you're the dean of the group and everybody knows it. everyone tells me they want to know what patrick daniel is saying. and so you're leaving with -- give me a note. where are we in energy in this continent? where are we with oil? where are we with gas? >> well, i think you summed it up very well in your introduction, jim. particularly with regard to infrastructure, we're really in the heyday of infrastructure development, largely as a result of the significant increases in production of oil in north america, not so much on the gas side right now, but particularly with oil. whether it's out of the bakken, the eagle ford, any one of the number of areas in the u.s. as well as, of course, the canadian oil sands. and we happen to be very well positioned to move the oil out of at least two of those major reservoirs. >> a lot of people who watch our show are familiar with the discount between west texas, the crude of west texas intermediate and the brent, which we pay our

gasoline off of. your company's doing something about it, isn't it? >> yes, we are. we're working in conjunction with our partners enterprise to reverse the seaway pipeline which operated from the gulf up to cushing in order to take cushing oil south. and 150,000 barrels a day of capacity on stream by mid-year and by the end of the year, over 450,000 barrels a day at capacity to help clear that glut in cushing. project's going very well. >> will that do it? or is it about 1.5 million to shift? >> well, you know, it's a very good point. i think it will take more than that. and as a matter of fact, we have an open season out right now in order to probably twin that seaway pipeline. that open season closes on the 2nd of march, and we're most likely to build a twin to it going south because there is demand for a lot more than that volume. >> brent's probably correctly priced and west texas is underpriced because your pipeline's not working yet, right?

>> that's right. that's exactly right. brent is effectively world price and wti has been selling at a significant discount, which means everything upstream of that, the bakken crude, the canadian production, is all selling at a dramatic discount to world pricing, and we need to be able to for our producers get that pricing. >> the pipeline shortage is even worse than in cushing. your company's doing something about that too, right? >> yes, we sure are. we've got a major expansion in the bakken underway right now. and yesterday we announced further expansion in order to extend south of the missouri river in order to pick up another 60,000 to 70,000 barrels a day of production to bring into our main line in manitoba. we've got a huge amount of capital going into expanding the bakken. there's crude oil being railed out at quite a bit more expensive to do it that way, but the production has grown very dramatically over the last few years. >> you presided over a period where the united states has gone

from being an importer of natural gas at very high prices to being the world's low-cost producer. do you sense any sort of recognition in washington that that's happening? and that perhaps one day we will be using many natural gas surface vehicles in this country? >> you know, i've got some sense that awareness is there, but it's been very slow on the uptake. and there's tremendous potential for natural gas with the huge reserves that we've got and the relatively low pricing in order to bring it in as a more prominent fuel in the overall energy supply in north america. tremendous opportunity to make north america self-sufficient from an energy point of view. not only these oil plays we're talking about, but tremendous opportunity on the gas side, as well. >> all right. i want to speak to you about spills. because when bp had its spill, did a little lip service, came down a couple of days. you moved personally to where enbridge had a spill. and i need you to give us a reflection about whether the

keystone fight is based how much on the fact that oil is supposed to be so dirty and how much of it is fear of what you saw on the pipeline spill? >> well, you know, i think it's fair to say that probably the fear of a spill is somewhat relevant to the rejection of keystone xl, but to tell you the truth, jim, i think it was more the move, this move to get off oil, as impractical as that sounds to you or i. so many people seem to think we can just get off oil altogether or that we should dramatically limit canadian oil sands crude. which is a cleaner sense of energy than coal, for example, which is used for most power generation in the u.s. so as impractical as those arguments are, i think that became a very big emotional issue and resulted in at least the delays that we're seeing in keystone xl. the spill issue, to tell you the truth, i think our company did an outstanding job of addressing that, responding to it, and

cleaning it up. and i'm sure that other operators will do equally good jobs if that kind of incident does happen again, and let's hope it doesn't. >> one last question, just philosophically because i know you're retiring. canada recognized the countries with all the factories are polluting over there. doesn't the oil we don't take just go to china? if we don't burn it, someone else will and probably not as cleanly as we would. >> well, i'm sure that some of the oil produced in canada will ultimately go offshore and into the asian market. now that -- we started an initiative about 10 or 12 years ago to move crude oil to the west coast, long before a lot of the controversy around the oil sands or for example the rejection of xl. mainly to broaden out markets for canadian producers, and i think that's critically important. but you're right, some oil sands crude will inevitably move into that asian market.

that's where the growth is. growth has really tapered off in north america. >> well, patrick, i want to wish you the best of luck. you've done a great job. we didn't even talk as much as i should about how much money you've made for shareholders. but if you're going to continue, you've left your company in great hands. thank you so much for coming on our show. >> thank you, jim. >> that's patrick daniel, president and ceo of enbridge energy. mr. daniel presided over a remarkable run in a stock price. stay with cramer. coming up -- what the heck? after the government cuts defense spending, one major contractor hits new 52-week highs. cramer's in the trenches to find out why. and later -- whether the dow soars or hits the floor, jim tries to help you stay on steady ground with "am i diversified?" all coming up on "mad money."

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okay. get this. after the show monday night, a business school kid comes up to me and asked a really good question about lockheed martin, the big defense contractor. he wanted to know what the heck was a defense stock doing at its 52-week high in this market, with all the budget cuts and all that nasty stuff coming down from the pentagon. the downsizing, how can it be, he wanted to know. shouldn't lockheed be flopping big when the defense department's hellbent on slashing spending? is the market, he asked, being stupid? >> what the heck? >> i like that query so much

that i decided to create a new segment called "what the heck" where a valuation is called into question by common sense. and we've got to drill down and figure it out. otherwise, it seems too stupid for words. so what the heck is -- when you're branding a segment, yo you can repeat it. what the heck is happening with lockheed martin? it gets 82% of its sales from the u.s. government. it's heavily centered on that with the remainder coming from international customers like foreign militaries. they make really awesome military aircraft and transport planes like the c-130 hercules. also makes combat systems, missile defense systems and nuclear instrumentation systems for the navy. they handle security and cybersecurity and they also have a nice space business where they

make satellites and missile systems as well as doing work with nasa. talk about a challenge group of clients. every one of them is trying to fight for every last dollar. in other words, lockheed martin is the exactly kind of stock that should suffer given the spending cuts and president obama's extricated us from iraq and seems bent on doing the same thing soon with afghanistan. remember, because the deficit super committee in congress couldn't come to an agreement on a solution, that triggered an automatic $450 billion across the board cut in defense over the next ten years. it used to be controversial to even suggest cutting the defense budget. but now those previously unthinkable cuts have become a reality. and over the next decade the pentagon's big budget is expected to decline from 5% of gdp in the country to just 3%. obviously none of this is good news for any of the defense contractors. and lockheed martin in particular has been hit with a bunch of damaging headlines about how the government has cut

back orders for the f-35 and that's lockheed's next generation fighter plane and it is indeed the money contract. the stock's been performing like a champ. lockheed rallied 17% last year, dramatically outperforming the s&p 500. it's continued to run in 2012. to the point where it's now just $1.50 off the 52-week high. if you only looked at the action in the stock and didn't read the front page of the newspaper, you'd think not only was there nothing wrong with it but something great must be happening to it, hence the new segment. what's going on here? the market being ignorant? or does it maybe know something that the rest of us don't? are these defense cuts simply not as important as they look? or maybe they're being trumped by something even bigger. could it be six of one, half a dozen of another? here's the thing, lockheed martin is not alone, there's some genuine defense pin action here.

raytheon and general dynamics, two contractors have been rallying of late and both within striking distance of their highs. the reasons, okay. first of all, as is often the case before a stock really takes off, expectations for this sector and for lockheed were very low, and wall street has been really negative on this group for ages. they all saw it coming. ever since the deficit super committee failed in november, the market has been bracing for for the worst. congress doesn't have to figure out what to cut from the budget until next year, so it's very likely we won't hear about any more defense cuts until 2013. in other words, there aren't any negative near-term catalysts for the group like estimate cuts, but at the same time, the bar's been set incredibly low, that's why the defense stocks will go up on the slightest positive news or even on bad news simply because it's not as negative as people feared. second, even though all the big defense companies are looking at revenue declines going forward,

they have the ability to offset those declines by cutting costs. and these companies generate tons of cash and that can be used for buying back stocks that ultimately boosts the earnings per share by shrinking the number of shares out there. we saw this when lockheed reported back in january. the company delivered a gigantic 19 cent earnings beat off $1.95 basis. yeah, 10%, thanks to stronger than expected margins, but more importantly, a dramatically reduced share count. third, this is one of the most shareholder-friendly sectors out there. and lockheed martin is the friendliest of them all. with a 4.5% yield and a buyback big enough to matter. and that's not nothing. it's almost like auto zone. remember that one? azo keeps going up? plus the company raised its dividend every year since 2003 and get this, it gave you a 33% boost since september, one of the largest we've seen in some time among all sectors and it's likely that lockheed martin is going to increase that dividend again. think about the yield, it stays right here.

in fact, if you had to buy the stock, lockheed would be the one to own, with its cash flow, executions, and most importantly the ability to expand further into international markets to escape the pain of u.s. budget cuts. people want that. keep in mind, nobody's putting a gun to your head and telling you to buy defense contractors. i find all those points persuasive and you can make a solid case that their rally makes sense because the defense cuts might not hurt as much as people expect and the expectations were so low there was nowhere for the stock to go but up. particularly as the middle east heats up and we're concerned about a militarized china. but there's another big reason. it's an election year. and these are typically the best times to own the defense contractors. we looked back to 1976, the defense stocks outperformed the s&p in seven of the last nine election years. and that's not all, because the defense names are a great bet if you believe obama will lose the election. something that seems less likely the longer the republican primaries drag on, but can't rule it out. and the last two election years where a republican took the

white house after a democrat, the defense outperforming 19% in 1980, remember that with reagan? he went with a 300-ship navy and by 52% in 2000. i don't see why this time should be any different. all the republican contenders have been extremely vocal about the need for higher defense spending. and if romney beats obama, he said he'd reverse the defense cuts. there's a chance it might not become a reality at all. bottom line, lockheed martin's trajectory makes a lot of sense. it makes a lot of sense to me. when it comes to defense stocks, there's method to the market's madness. a madness that wants yield in a time where there's very little return from bonds. a madness amongst cheap valuations. madness that seems downright rational to this "mad money" guy. let's go to barry in georgia. barry? >> caller: hey, jim. how you doing today? >> real good. how about you? >> caller: doing good. got a question for you on one of your pin action stocks from the

energy segment, kdn. they didn't report a good quarter in military or their wind turbines. and i'm getting disinformation because of the special dividend. >> right. >> getting di information from brokers as to when the next date of that is. and they're telling me nothing until next month. >> yeah, i don't think they've announced. you know why? it's very funny. i was talking with my friend david faber, some of these companies are doing special dividends. we want earnings. they did not deliver the earnings. and you know what? that's not good enough. if domino's pizza does a special dividend it will be because their earnings allow them to. we'll get that date as soon as we have it. but you know, i need earnings, earnings, and more earnings. all of that is said, it's not like the stock has been a loser, it's stock's up 23% year-to-date. it's just i would have liked a blowout quarter too.

and you can't ask for everything. how about gary in new york, please? gary? >> caller: jim, forget about it brooklyn boo-yah to ya. >> i was in brooklyn last night. i'm loving it. good pizza there called domino's. holy cow, i heard the -- no, that couldn't be a hang-up, could it? we're so prepared for everything. john in nebraska immediately, john? >> caller: yes. >> you're up, john, what's up? >> caller: oh, jim. hey, i appreciate all the help you give us home gamers. >> i sure do try. every day i come out here. you think sometimes i'd be tired. go ahead. >> caller: you're the master of six in 60. >> i've got to tell you, i wish they gave me six hours and 60 names in that time. what's going on? >> caller: hey, my stock's united parcel service. it's a 52-week high and gasoline's going up. what do you recommend? >> well, okay. i thought when i see a stock like u.p.s. making a very expensive tender offer in europe and the stock didn't get hit, you know what that tells me?

that tells me you got a solid buy! it is outperforming fedex, i think u.p.s. is terrific. my charitable trust owns it. i wish it would come down so my trust could buy it back. all right. guy puts it right to us, business school guy saying, jim, what the heck? we're making it a new segment. when we see stocks that are counterintuitive like lockheed martin, we will drill down and what the heck? turns out lockheed martin is cheap, shareholder friendly and a bunch of catalysts. stay with cramer. coming up -- ride the lightning. take a non-stop thrill ride as cramer goes stock after stock. all your calls taken rapid fire on the "lightning round." and later, whether the dow soars or hits the floor, jim tries to help you stay on steady ground with "am i diversified?" all coming up on "mad money."

it is time. it is time for the "lightning

round" on cramer's "mad money." play until you hear this sound and the lightning round is over. are you ready skeedaddy? time for the "lightning round" on cramer's "mad money." neil in new jersey. neil? >> hello, jim, i'm a first-time caller. my name is neil from atlantic city, new jersey. i've been watching your show since you first started on tv. thanks for your help. >> you're terrific. >> caller: what is your opinion on sky works? swks, is it a buy? >> brian, who writes this terrific breakout stock newsletter, spent a lot of time recently. i think they're spoken, i think they're back, i think they're in the new iphone coming out. buy, buy, buy. laura in kentucky. laura? >> caller: my ticker symbol is nuan, it's nuance, i need to know whether to sell it or hold it. >> i do not like -- this is a company that does speech recognition, that's something i don't like. my pal herb greenberg taught me to be very skeptical of that industry and i am and i'm not a

buyer. johnny in california? >> caller: boo-yah, jimmy cramer. >> you got me, all right, partner. i've got to tell you, i would only buy that in deep in the money calls. you've got a real speculative situation there. peter in maine? peter? >> caller: yes, boo-yah, jim. this is pete from maine. brazilian steel, vale. >> i wouldn't mind it, but i'm nervous about brazil. think about freeport, cheaper and it's got potential to have a higher yield. why? because they keep raising the dividend. i'm going to nick, also in my home state of new jersey. nick? >> caller: nick from wayne, new jersey, boo-yah. >> boo-yah to you, partner. >> caller: jim, sony has been trading relatively low, do you think it can pick itself up again? >> do you use a walkman or an ipod? come on, my friend. >> sell, sell, sell. >> don't buy.

>> sorry to be so in your face. let's go to richard in illinois. let's go to richard in illinois. >> caller: boo-yah, cramer, my friend kevin is real jealous right now. my question is about the stock sohu, is it going to make a comeback or should i get out? >> we don't recommend chinese stocks! other than baidu, i'm in sell mode for the whole country. why not? let's go to bob in texas. bob? >> caller: boo-yah from bob in corsicana, texas. jim, my wife, son and i love watching you daily. your insights and witticisms. what are your thoughts on deluxe corporation? >> i've got to tell you something -- >> don't buy. >> needs a catalyst, doesn't have one. i'm going to andy in my old home state of pennsylvania. >> caller: boo-yah from pennsylvania. >> what's up? >> caller: i love the show every

time i watch you. thank you for that. i owned crate back when they were $50 stock, really taken a beating, they hit a 52-week high today after projecting 2012 to be an outstanding year. what are your thoughts? >> you know what? it's come back. what can i say? it came back. it's a very small-cap stock. i've got to do more work because they just did a teleconference and i'll come back. i'm marking it as homework. i can't opine until i read that conference call. and that, ladies and gentlemen, is the conclusion of the "lightning round." >> the "lightning round" is sponsored by td ameritrade. [ male announcer ] what if you had thermal night-vision goggles, like in a special ops mission? you'd spot movement, gather intelligence with minimal collateral damage. but rather than neutralizing enemies in their sleep, you'd be targeting stocks to trade. well, that's what trade architect's heat maps do. they make you a trading assassin. trade architect. td ameritrade's empowering web-based trading platform.

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hey, look, sorry to burst your bubble, bears, but i don't think we're in one. maybe it was time to call bubble in 2008. i don't feel a bubble here. remember last leap year? right, that's the last time we had the real bubble. or was that friday? anyway, it doesn't matter. just because things are looking better, doesn't mean we abandon the fundamentals. you'll always need to rely on these investing basics, that's why we play am i diversified? that's why you tell me your top five holdings and i tell you if you need to make a couple of

trades. nathan in california. you're our first caller. what have you got for me? >> caller: boo-yah to ya, cramer. >> sweet. >> caller: i've got caterpillar, alcoa, american capital agency, morgan stanley, and waste management. am i diversified, cramer? >> it's killing me. anyway, we've got morgan stanley, a financial, waste management, garbage disposal, american capital, that's a financial reit doing well and we have an industrial. we have an industrial, a financial, the waste, you know, no, that's machinery and that's finance. that's perfect and you've got yield coming to you too for waste. how about jeff in florida, please? jeff? >> caller: hi, jim, big warm boo-yah from florida. >> all right, sunshine, hit me. >> caller: i've got 15% in gld, my top five stocks above that are disney, etp, 3m, n.a.t., and

slrc, solar capital. >> oh, really? boy, you've got some good ones. you've got good yield. gld down hideously today. we let it settle and do some buying for those who don't have -- who need to get up in the position because it's been a great win, it's not going away. nordic american, great yield. energy transfer, another great yield, actions alert plus.com name, disney, just boosted the dividend. solar capital, huge yield, and 3m, industrial, entertainment company, and a financial company. and i say yes with good yield, good diversification. skip in new york. >> caller: this is skip from bay ridge, brooklyn. >> what's up? >> caller: i'd like to know if i'm diversified. phillip morris. >> what a stock. >> caller: johnson & johnson.

johnson controls, glaxo, and with a name like smucker's, it has to be good. >> actually, smucker's last quarter wasn't that good, they got hit by the rising cost of peanuts, by the way. glaxo, high yielding drug stock without a lot of growth, phillip morris, just a best in show. one of the best-performing stocks in the world. j & j, a problem there, smucker's, food, if i had to be in a food stock i would prefer kellogg. i don't like this grouping. i don't like the j & j and glaxo. let's sell some j & j. and let's bring in, you know what? why don't we bring it a wells fargo or u.s. bancorp, get financial in there and that would do it. "mad money" is back after the break. so who ordered the cereal that can help lower cholesterol

and who ordered the yummy cereal? [ woman ] yummy. lower cholesterol. [ man 2 ] yummy. i got that wrong didn't i? [ male announcer ] want great taste and whole grain oats that can help lower cholesterol? honey nut cheerios.

i want you to feel free to hold my feet to the fire when i make mistakes. don't beat me up when i'm right. what am i talking about? all day i've been getting complaints like, cramer, you buried me alive in first solar. how could you let me down so badly in soda stream? that's the kind of feedback i get today, much of it on twitter @jimcramer with people eager to hold me accountable for two declines. these are declines i told you to get out of the way of a long time ago. let's start by tackling first solar, once again being hammered mercilessly after one more bad quarter. is it true that at one time i embraced first solar?

not just one time, for years, it made us a ton. they had the best product, they were developing the intel of solar making mass production at a price advantageous for all the countries doling out subsidies. but there were a couple of things that happened along the way that were devastating. chinese needed to be big into solar. they came with both guns blazing, blew away the market for everyone. the whole industry got clobbered with the wind down from belt-tightening countries, especially spain and germany which were so committed to solar they were willing to radically overpay for the technology. as good as it might have been in the heyday, don't ever believe for a minute that first solar's product or the whole industry was ever economic without huge government handouts. that's why more than a year ago on september 2010, after liking it for a long time, i put first solar in the sell block, it was $138. i wanted everyone out of it. citing concerns in the gross margins. how worried was i that people might be in this stock? despite my pounding on the table to sell at $138, i went back in

last october and made sure everyone knew despite the decline since i first told you to sell it i was still concerned about the company and those in it. people were excited about a large government loan. so what? i don't care about it. some are saying a takeover was in the works, almost inconceivable. what i did know was the earnings estimates were dead wrong and it was a good call. go back and check it if you want to. the only way you'd be into first solar on my recommendation was if you were shorting it. how about soda stream? things were rolling. things were rolling in the 30s. and soda stream machines and the cylinders were selling like hot cakes, but last july i said, enough, enough, this one's too hot for me. take the game, please. what can i say? it was a terrific trade. i haven't looked back since then, that's been the right call. because the machine sales have slowed and slowed dramatically. you listened to me, you would have sold soda, you still would. end of story. look, i'm making a lot of mistakes, just like all the pros, it's part of the game.

but when i get it right, i'm not even asking for your thanks, only asking you not blame me for your losses in the stock that i told you to sell. stick with cramer.

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