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tv   Mad Money  CNBC  March 15, 2012 6:00pm-7:00pm EDT

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carnival cruise. >> specific drilling. >> short spy. >> see > . >> i'm jim cramer. welcome to my world. >> he's going to go out of business. he's nuts! they know nothing! >> i always like to say there's a bull market somewhere. "mad money" you can't afford to miss. >> hi, i'm cramer. welcome to "mad money." my job is not just to entertain you but to educate you so call me. this stock market, it's like an energetic and rambunctious teenier. it teams to have a snappy comeback for everything.
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something we saw again today with the dow gaining 59 points, s&p fall 6%, nasdaq 1.5%. it's a darn know it all group of stocks that regularly makes the bears look like fools skp! fools who think they've got it completely tamed but just the opposite. the bears, they just don't have it right now. >> the house of pain! >> versus i've been saying for weeks now on end one of my biggest fears is the action in what's known as the tranis, or the transports. i always looked at this key index as a measure of whether the industrials are telling the truth the old axiom i like to follow is if the transports don't confirm the movement in the dow, meaning support it with their on positive action, then you might be witnessing a false move higher, to make me, an older guy
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who has traded since the late 70s truly sanguin. you need the rail stocks, cfx, the shippers, united parcel, federal government, the airlines and truckers like delta, jb hunt. they got to be all on the move up because they stand for the strength of commerce. it makes sense temperature think about this for a second. it's very rational. if you're going to manufacture and sell good, you got to ship them somewhere, right? so these stocks are the best gauge of economic activity. when you transport goods and people at rising level, that's how you know the economy is really humming. it's not just sitting around, it's being sent! but the transports have been dragging horribly, diverging so badly from the dow that the bears have been pinging me saying hey, hey, you got to tell people to get out of this market because of the trani diversions. that's code for, cramer, i'm
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short so help me out by bashing the market. to which i say that cramer, like homey, don't play that. sure enough, today the transsports exploded higher, much higher than the averages to the point where they're on the verge of taking on their high there is. the bears are banks the whole scenario on a collapse in the tranis and send all the yogi, the boo-boos, the gentle bens back into hibernation. as natural gas has come down in price, the weather stayed warm, the rails got crushed. not good. but today the execs expressed the rest of products are going mad. they say the rails will make their numbers if not exceed them. oil prices isn't the price of crude lower on fears the
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governments around the world will open the strategic petroleum reserves. even though it was denied, the airlines took off anyway. short sellers covered as bargain hunters in. i don't think oil will come down until we as a nation broke opec's choke hold by switching to natural gas, something that could be done in just a few years in the government got behind it. still, to see the rails and oil move up in unison was terrific. buyers swarmed into ups and fedex. t poof. today it was supposed to be the day we were going to hear about the stress test and possibility we might see another round of big equity offerings by these incredibly deluded creatures. tuesday the government simultaneously jumped the gun on
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the news and there were shockers. ahead of the result, people placed big bets against bank of america being blessed by the feds and huge wagers on citigroup that it would get the go ahead to pay out a bigger dividend. got the exact opposite. when the stress test came out two days early, bank of america didn't need to raise capital and citigroup flunked. didn't even matter. after a quick initial drop of the citi stocks, it's back to where it was. bank of america stock is roaring. and what bank is doing the best? one of the biggest failures, suntrust. we've been buying suntrust. it's just not that bad. when failures go higher, you lose a done of bearish ammo. they don't have a case. after the stress test results came out, they don't have it. we keep hearing the housing
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business hasn't turned, the good news is all anecdotal. i've been getting reports from home depot, lowes's and tractor supply, three related businesses that should be getting crushed, right? what am i hearing? that business is off the charts for the month of march. the numbers are so incredible that you know these runs aren't over. that's a slap right in the face of bears. if gasoline is so high, you want to cut out or cut back on discretionary spending, right? but particularly food. but today chipolte and pannera both his 52-week highs. so important in this market because the oils are becoming a bigger part of the specific as much 500. given crude's declined today, you'd expect the stocks to get clobbered, right? but the vast majority moved up, led by deep water drillers of
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all things. finally, how about the disarray, lead story in the f.t., the financial times, with the disarray about china. the shanghai market, it got hammered! i nearly saw bearish bets being place on on the conference and those two 2010s of chinese capitalism, cummings and caterpillar. joo giant exporters to china. of course not everything can be perfect. i'm sure the bears will come out tomorrow and point to the lagging performance of apple and its key reversal today as it hit 600 before rolling back to 585 and change. i expect to hear chatter tomorrow about how tech is too high. to which i say if i know this market by next week, tech about burst out to the up side, too, because the bulls will have answers. the bottom line is this market seems to sense the objections of the bears, it takes them all in, it bends to their wishes for a
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few days and then just like that, snap! the bears are caught in the jaws of their own logic. today we left behind a whole bunch of hobbled and dazed kodiaks. wondering what the heck happened to their best arguments? bears, i got a message for you. look out, the bulls have your play book. they know your dens. they know where you hunt. they've got traps set just about everywhere you step. what can i say? right now the bulls, they're just plain smarter than the average bear. let's go to merle in ohio. merle! >> caller: hi, jim, how you do sfg. >> pretty good, sport. how you doing? >> caller: good. i was reading a czechoslovakian cookbook and i discovered where booyah came from.
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>> really? >> caller: it's a stew made with vegetable and rabbit and -- >> i was reading a book and it turned out to be mad. >> caller: cisco, is that a buy or hold or sell? what do you think is going on there? >> i'm confused myself. i said, look, i got to tell you, i need some focus. then i was talking to deborah borger, doing a video at thestreet.com and i said i don't know what they're doing, cisco. they're just spending money. my head is spinning around like reagan and there's green vomit spewing around cisco. >> caller: booyah to you. >> did you know booyah is from a czech cookbook? >> caller: we'll have to try that, as long as there's tasty cakes in there.
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>> tasty cakes cakes and pies. send me some crimpets. >> caller: and we'll do it during a new york-philadelphia ball game. jim, i'm noticing the march madness going on and i'm looking at my picks for the elite eight and it looks like every one of those team will be wearing nike uniforms and nike shoes. so the question is this: about eight months ago you said nike might be turning into a cyclical stock. i just wanted to know did you change your position on that or are you holding firm? >> i think there's a lot of secular growth in nike and also cyclical. we have the olympics. you do great cyclical up swing. let's just put it this way. they're in both worlds and both worlds are good, the cyclical and secular. that's why nike is going higher. it's the best growth stock on my rar dar screen other than starbucks, whole foods, chipolte and mcdonalds.
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yes, i'm not giving up on that. chris? >> caller: i like capital one. they're likely going to get hsbs. i saw their stock offering today. my question is do you like their move? >> stephanie lake , the executie director. she and i go back and forth to get into capital one. she's arguing, listen, you can't have -- it's not diversified if you have american express and capital one. i keep saying we have to get in on the second offering. turns out we're both right. this capital one has gone much higher. cof is the one to be in but american express, that ain't so bad either. the bears got caught in their own traps today. the transsports are trucking. who went down? the banks are bankable. the bulls it seems right now yogi and boo-boo, hey, hey, you're dumber than the average bull. we'll be right back.
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>> coming up, urgent care. dr. cramer is pitting two health care plays against each other. which stock is the best medicine for your portfolio and which one will be admitted to the sell block? and later, drilling for tech. where's the real innovation these days? cramer's looking for a new breed of tech stocks. >> tonight a slick oil play that's taking a page out of apple's playbook. all coming up on "mad money." 3q we always hear about jobs leaving america.
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here's a chance to create jobs in america. oil sands projects, like kearl, and the keystone pipeline will provide secure and reliable energy to the united states. over the coming years, projects like these could create more than half a million jobs in the us alone. from the canadian border, through the mid west, to the gulf coast. benefiting hundreds of thousands of families throughout the country. this is just what our economy needs right now.
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much homework you did, eventually you're going to make mistakes. that's the nature of the game. so how do you know when you've made a mistakes and what you're
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supposed to do about it? for years i've been recommending allscript, mdrx as the way to play the switch for electron being medical records, electronic prescribing, the health care technology shebang, bringing them into the 21st century. but for some time allscripts has been lagging behind its main competitor. i realize after initially being right, we've been back on the wrong horse in this make information technology work. that's why even though it's hard to do, we need to ask ourselves where we went wrong by backing all scripts and figure out whether cernor can be the better stock. the there was a section of the stimulus bill that created a seft carrots and sticks to encourage doctors and hospitals
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to adopt electronic records if they canshot government they're using the new systems, they get a nice subsidy. if they don't, medicare/medicaid reimbursement rates will take a hit. it's the reason i got behind all scripts. turns out i was right about the theme but lately wrong about the stock to trade it with. i think our main mistakes with all script was we didn't do the comparison with cerner earlier. all scripts has given you a 124% gain. but it's not better than the quadruple you could have gotten if you bought cerne re. cerner has kept on. apparently we backed the wrong guy
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the worst thing you can ko do is come out here, compound your problems and dig in your he'll. i'm going to eat crow and put allscripts on the sell block the reason i'm making this chang -- i got a bunch. first excuse. cerner has been fabulous, while allscripts has lots of hair. we say a company has no hair when it has no problems. cerner is bald and beautiful like me. there are platforms integrated across increase and outpatient settings. they've developed more software in-house and have a big first mover advantage. their platform has been integrated offer a long were period of time than others. people in the health care industry vastly prefer their system. they have superior technology, they install with less glitches. we get a lot of data and have
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done a lot of reporting on this. originally allscripts catered to outpatient settings like doctors office. back in june of 2010 they bought eclipseus which gave them exposure to the hospital business. since then they've had problems integrating their platform with their own. and allscripts has a large number of different versions in their market. cernor doesn't have these problems. you would see repeatedly this was pointed out when i talked about allscripts last. when you look at the hospital market, cerner has 13% market share. this matter. they already have oo built-in advantage. about 52% of the hospitals in america use at least one of cerner's applications. third, visibility, which is what portfolio managers want so
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badly. cerner can predict 75% of its earnings into the future. it means management has a great handle on its business. allscripts, however, has a lot of trouble managing expectations. you can see this from the last quarter reported, which is important for this business because it's the quarter where hospitals set their capital budgets and decide if they're going to switch it systems. cerner delivered a fabulous system. people talked about it like there was no end to it and the stock soared. the key metric is bookings. cerners up 44% year over year and this was the fifth straight quarter where management had beaten the high end of its own bookings guidance by more than 50 million. talk about underpromise and overdeliver.
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allscript, let's just say they seem to be doing the opposite. they are overpromising and underdelivering. when all scripts reported on february 17th, they were up 26% year to year but below management's previous guidance. allscripts got bullish guidance the next quarter but at this point i'm getting skeptical. much of earnings growth came from cost savings this quarter and i didn't see enough organic sales growth like i did at ce cerner. it tells at 28% earnings. allscript sells at a parliamentary 14% earnings. it just looks cheaper because you get what i pay for approximately remember it's always worth paying up for the
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best. i think it's clear it was wrong that i backed allscripts for too long. it's never too late to come in here and admit that you're off base. so tonight i'm blessing a buy of cerner. the mantra will always stay true for you. it's not about making friends. it's about making money. after the break i'll try to save you some money. coming up, drilling for tech. where's the real innovation these days? cramer's looking for a new breed of tech stocks. tonight a slick oil play that's taking a page out of apple's playbook. people with a machine.
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what ? customers didn't like it.
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so why do banks do it ? hello ? hello ?! if your bank doesn't let you talk to a real person 24/7, you need an ally. hello ? ally bank. no nonsense. just people sense. . in a market where individual companies finally matter, it's important how to know how to pick high quality stocks across all sorts of industries. i've been looking for technical stocks out side of their sectors. why am i bothers? simple. the market thinks about them the wrong way. my new tech names are undervalued because people think
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of them as a power company or chemical companies or engine makers when in fact they're really much more like the great growth tech stocks of old since they use proprietary technology and dominate them from here to eternity. take national oilwell varco, nov. people see this national-oilwell varco as a commodity player out of the comedy gas complex. if you look at the stock's performance over the last 12 month, it's pretty much traded in lock step with the price of oil. it cannot be totally divorced from the oil and gas cycle. if iran decides to roll over and say uncle, the stock could be hammered. i think it's more likely that permanently elevated oil prices is here to stay and in a world
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where black gold is scarce, it's not just a play on the oil patch, it bigger than that. just a microsoft dominated software and apple owns the entire tablet mark, nov has become one of the dominated players because it has unparalleled technology. the other competitors can't keep up. think apple, they can't keep up. deep drilling has only been possible since the late 90s. first generation of deep water rigs were built in the late 90s. we saw a second wave of deep water rigs being built that were vastly superior. since the the company has delivered 62 floating rig, highly advanced pieces of machinery, far superior to the
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first generation of technology. how do they do it? for starters, they operate four technical colleges. they have their own higher education system and they train hundreds of highly skilled service technicians to build the rigs. does that sound like an old metal bender or is that a technology factory? all that expertise is coming in hand each because we're experiencing a real renaissance in dreep water drilling. earlier this week we heard from jim hackett, one of the most deep water explorers out there and according to him the deep water business is back and bigger than ever and here to stay. in part because of long lead times and also there's a sense that $80 to $90 oil, bye-bye, thing of the pass, which makes the price of deep water drilling more than worth the cost. 86% of the company's $10 billion back log is for offshore
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equipment. a huge number of offshore rigs need to be replaced of tightened safety standard and nov is winning the contract after contract after contract. the on-shore drilling market is starting to cool off. 90% of oil drilling equipment is provided by national-oilwell. think of national-oilwell as being the windows of down home joy. they make the standard operating system the rest of the country can work with. they are working on a new rig control system to manage multiple automated tools from multiple companies. you can plug in tools for making connections, stability and rig maintenance and national oil
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well's new control system will manage all of them to allow for full automation of the rig. technology, people. rather than needing to operate each independently, their system will be able to run them together and they are working on a software development kit so other companies can write apps for the new system. that's like apple. if that's not tech, i don't know what it. the stock is going to be somewhat pegged to oil and gas prices. i'm agreeing. but i think it's seriously undervalued. it trades like a commodity play when it's a purveyor of technology. the health care technology company that makes robotic machines which turns average surgeons into brilliant wins, their technology makes up for the shortage of skilled surgeons in the country. national oil well is very
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similar. their rig technology makes up the difference to allow oil companies to perform all different functions. the market just doesn't get what national-oilwell varco does and is trading at a 61% discount to intuit surgical, even though the growth rate is the same. of course people are always nervous about the low price of natural gas having an impact on business, which is why the stock is only up 6% in the last 12 months despite a big rise in oil. but they haven't seen anything backing off ordering for well stableation equipment and land rigs. while the united states makes up 60% of revenues, it's only 16% of tr back log. they trade like an insignificant link in the oil food chain.
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this is an ino'vative technical company that makes deep water drilling possible. if you're like me and you think expensive oil is here to stay, you can buy national oil well on any of these couple dollar drops in crude that is going to be just regular iteration and you'll be able to buy this company at a huge discount to its technological value, which far exceeds what people think this old line company may be worth. let's go to dustin in iowa, please. dustin. >> hey, jim, big booyah from cedar rapids. >> hey, captain, how you doing? >> caller: doing pretty good. calling about embridge today, emb. >> no, no, this is a growth company. you're going to see various times things are not going to go right for them. you got to look at the ebidta. people say it seems very
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overvalued on earnings. it's not. i want to go to tom in california, please. tom? >> caller: booyah, jim. my stock is cfx. until today this has ban real dog and a loser since i bought it last year. is there any catalyst on the horizon such as oil and coal shipments? >> csx did say some very good this evenin things today about not to worry about the business. they are talking about the housing and construction market growing and they will offset the cyclical and secular designs of coal. new tech knows no bounds. the latest "mad money" tech play, it's national-oilwell
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varco. all your calls taking rapid fire on the lightning round coming up. 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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♪ when your chain of supply goes from here to shanghai, that's logistics. ♪ ♪ chips from here, boards from there track it all through the air, that's logistics. ♪ ♪ clearing customs like that hurry up no time flat that's logistics. ♪ ♪ all new technology ups brings to me, that's logistics. ♪
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only hertz gives you a carfirmation. hey, this is challenger. i'll be waiting for you in stall 5. it confirms your reservation and the location your car is in, the moment you land. it's just another way you'll be traveling at the speed of hertz.
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it is time, it is time for the lightning round. >> buy, buy, buy. >> sell, sell, sell. >> are you ready?
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it's time for the lightning round. marilyn in new york. >> caller: hi, mr. cramer. booyah! >> booyah, marilyn. what's going on? >> caller: i'd like your input on kft. ted? >> caller: booyah. i keep a small portion of my option for options trading. i'd like to get your thoughts on sodastream. >> i don't think it's the place to be. i know they had a new iteration. i think the stock is expensive. i worry about it. we had a great trade. we don't look back. don't buy. tommy in texas. tommy! >> caller: booyah to you, jim, from a hot, dry west texas, el
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paso. >> hit me with something. >> caller: how about conoco phillips? >> i like it. i get tired of seeing people say it's not exciting enough. i like paint drying. the splitup, which is going to happen soon, is going to be great. my trust owns that one as well as kraft. we think breaking up is easy to do. j in california. >> caller: i was inquiring about nokia. >> as long as you inquire but don't pull the trigger. they are getting their butts kicked by everybody, but particularly apple. nokia is the anti-apple. stephen in colorado. >> caller: the only thing getting beat up more than my bracket is newmont miners. >> the miners are radically
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underperforming the price of the metal. i like god but the miners are getting killed. please, please, stay away from the miners, own the commodity. mike in judicial. mike! >> caller: cramer, this is mike from new jersey. >> you're right around the corner. booyah. >> caller: i've been loading up on heck man and i'm in a world of pain. this just keeps on going down. >> here's what's happening. i said this on twitter repeatedly. this is not for the squeamish. this stock is going to go up over time. they've had to move their business to other places and because of that it had a shortfall. i think longer term we're going to be fracking in this country, not deep water fracking bull bu we'll be fracking and i think very, very powerful trend you cannot move away. you have to have a long-term
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perspective. doris in california. >> caller: hi. how are you? >> real good, doris, how about you? >> caller: thank you. jim, i would like to know your long -- your price target long term for -- >> ma'am, i don't really use price targets. i like to use fundamentals. if the company is still cooking. i think this stock is good because china is baidu. they have the power and google chose not to be there. let's go to vincent in new york. >> caller: yes, jim. happy anniversary. >> thank you very much, vincent. thank you. >> caller: i have here dvn. >> it's a buy, buy, buy. people don't understand it.
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two of the most important are energy security and economic growth. north america actually has one of the largest oil reserves in the world. a large part of that is oil sands. this resource has the ability to create hundreds of thousands of jobs. at our kearl project in canada,
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we'll be able to produce these oil sands with the same emissions as many other oils and that's a huge breakthrough. that's good for our country's energy security and our economy. bulls look like they have the edge, right now it is. but we've learned not to put all our eggs in any basket, including a risky one. there's no reason to mess with this fundamental logic of diversification. because the next time the bear have their way, you'll be ready. that's why you play "am i
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diversified." you call me and tell you your holdings. jim in south carolina. what do you have? >> caller: thank you, mr. cramer. and alabama booyah to you, sir. >> thank you, chief. >> caller: thank you. my top five holdings were apple computer, qualcomm, hewlett packard, frontier communications, and xec. >> we got to do surgery here. hewlett packard, apple and qualcomm are all tech. and qualcomm is in the apple, the new ipad. we're going to have to reluctantly sell qualcomm and sell hewlett packard, which i don't want anyway. i'd rather see you in wynn communications and cimarex oil and gas. we have oil and gas, teleco,
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computer. we need to have a finance and i'm going to suggest you get u.s. bank corp but travel trust owns that and a health care one. i'm going to suggest abbott. you make those changes and i'll feel much better about your situation. let's go to rosemary in missouri. i do have missouri to go deep in the tourney. >> caller: a big booyah to you from the show me state. >> show me, show me. you bet get to the elite eight. >> caller: i'm new at this and i just need your advice. i have a buy for you, it chesapeake, chk, ford, spectra, i just got microsoft and agnc. am i divorcified? if not, what do i need to do? >> you're new at the game but i think you're pretty savvy. ford, the oils have been beaking out. ford can do it. microsoft, you have tech. that's all right. good balance sheet, lots of cash.
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i like window 8. chesapeake and spectra energy, this is more of a peopleline and a producer. and mortgage capital is doing well. you have auto, tech, pipe, i think that's terrific. let go to jim in michigan. >> caller: hello, sir. i've got tfcx, sdd and intc. >> we can do that. we'll desymbolize that. we got dd, dupont. the stock is really breaking out. please miss coleman come on the show. intel, a great yield, at&t high yield and teleco. >> is giving up on freeport, they feel there's too much comer. i big it differ. i think the stock can go to 45. ford auto.
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bingo, i like the way it's played. now we're going to brandon, my old home state of pennsylvania. firing up the energy here. brandon. >> caller: how are you? >> i'm doing well. my five companies are bank of america, dr horton, ford, st. joe company and solzon. >> wow, people really like ford here. two housing plays, we'll deal with that in a second. solzyn experimental biofuel, bank of marketbank. bank, auto, realest state, real estate and let's call this byeio tech/oil. i want to get rid of st. joe and
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insert here let's go to honeywell. let's put a diverse feed manufacturer. i think honeywell is a terrific situation, even though it's right off the 52 -- two puts on three high. john in california. john. >> caller: jim, booyah from the stock club in sacramento, california. i love your seventh anniversary show yesterday. >> i was at the intersection with my car but i love sacramento. >> caller: okay. at&t, sirus logic, emerson electric, phillip morris and raytheon. >> i thought the people in sacramento had horse sense. this confirms it. phillip morris, raytheon, i like it. at&t, 5%er, and emerson, high
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yielding industrial and teleco. a defense and a tobacco. bingo, well played. sacramento is a beautiful city. stay with cramer. [ nadine ] buzzzz, bzzzz, bzzzz, bzzzz,
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you know, typical alarm clock. i am so glad to get rid of it. just to be able to wake up in the morning on your own. that's a big accomplishment to me. i don't know how much money i need. but i know that whatever i have that's what i'm going to live within. ♪ ♪
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hold -- slow and steady will win the after market race. this morning demand wair a cloud
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play on internet commerce, a maker of truck part both came public. monday i said do your best to get some shares of the ipo. the company could be like a junio junior.com. i told you it was reasonable to pay up to $16 because it would be selling a little less than seven times sales. trade demand where prices exceed. it opened at $25.15, making it the most expensive stock at the sector. absurd letter. later retreated to 23.59. how about allison transmission. it opened and quickly fell 30% below. it closed about w a 1.7% gain. this has tremendous franchise in
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automatic truck transmissions. growing cohort in a growing area. i'm a big fan of cummings. hit a fresh 52-week high. this morning dewey allison, transmission truck veteran ceo. he said despite the tremendous revival, the only in its fifth inning and this is not a preseason game, it's a real deal. we know from our work on westport innovations the natural gas truck maker and clean energy fuel that tons of trunks are being bought to comply with new ef missions standards. how do these two ipos stack up against each other? automatic transmissions, i cannot possibly tell you stay it in. listen to steve miller, take the
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money and run. allison transmission, on the other hand, represents genuine value and the fact that it didn't pop to a premium allows me to recommend it right here as a terrific investment on the resurgent truck business. the tortoise that is allison now has it all over the fast starting hare that is dema demandwear. at this point the like the long-term stock prospects of allison transmission much more than demandware. slow and steady wins the race. stick with cramer. next billionaire shale fracking tycoon on the obama policy that isn't. next on "the kudlow report."
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moments away on "the kudlow report," president obama still attacking and mocking oil and gas companies. he's on the wrong side of history. and beside oil and gas, has the president become the regulator in chief? and by the way the s&p beats 1,400 on more good economic news. stick around for "the kudlow report" right after this. larry it talking to harold hamm from continental resource.

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