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. other people want to make friends. i just want fewer days like today. my job is not just to entertain but i'm trying to do some teaching and coaching. so call me at 1-800-743-cnbc. if you want drama, go to the theater! that's the lesson of a day like today, where the averages got completely pummeled. dow sinking 161 points. s&p giving up 1.43%.

nasdaq losing 1.17%. people are drawn to drama like moths to a flame in this market. just seeking it out. that's a huge mistake. hence why i want to trace out some dramas tonight, tell you why they're flops, so you know how to avoid them because alas, this ain't broadway. and you don't want to attend, even if you're getting some two-fers. the old nickname of two-for-one tickets, meant to lure you into a show that might close at any moment. especially against a backdrop of immense european pain like we had today. don't give my regards to broadway. the first drama, how about the tragedy? the tragedy of research in motion. i understand why people would want to attend this one. they know the product. they love the easy to use keyboard. there are over 70 million blackberry users out there. not as many as the 900 million strong facebook users. but those folks are a heck of a lot easier to monetize because

they pay a subscription fee and are therefore actually worth something to someone. but who is that someone? and that's the question that makes rimm a drama and perhaps one with a sour johnny drama ending. users had a love affair with blackberry, but the other guys, notably apple with its amazing ecosystem and equally amazing iphone with siri have now left rimm in the dust. plus research in motion chronically underinvested in new technologies, kept a closed system that made its devices incompatible with other systems. to make matters worse, rimm was once known for its incredible reliability, but a couple outages wrecked that reputation overnight. we've had failed iteration after failed iteration of rimm to the point where the company's losing subscriptions to the competition in droves, despite management's for the better changes and for the repeated restructurings. more importantly, as long as research in motion wasn't losing money, there was a chance it could catch a big takeover bid. but now after that red

ink-drenched quarter last night we know the company's moved into the death rattle phase. rimm has entered a tailspin that most companies can't pull out of. think about nokia, alcatel, lucent, palm. they're all going down this path. it's very dramatic, but not at all investable. my friend david faber even mentioned it in the same breath as nortel today. sure, rimm should be taken over. absolutely. but the company's adamantly opposed to such a sale. i don't even think the canadian government would let anything hostile happen here. remember, canada stopped that hostile bid for potash. i think they'd do the same here. anyway, we never speculate on takeovers when the fundamentals are in decline. that's one of our "mad money" rules. so i think the notices are negative. the drama in research in motion will probably end badly for all involved. there's no need to make yourself a participant. then there's the drama that is facebook. which i see as kind of -- i'd say a very dark comedy. 52-week low again today. you know, facebook at one point

did try to gain some footing. it looked like it was going to go up. it was up when everything else was down. it seemed as if perhaps the line had been drawn. and the buyers who came in voraciously on the ipo at $38 had chosen this level to average down. others said look -- i heard this all day today. this is a long-term situation for heaven's sake, you can buy it and forget about it! i don't really know any situation that you can buy and forget about. i've never seen one where we can just forget about it because don't worry about the short term because the long term is so amazing. what matters is that this drama has no real end in sight. remember, we still don't know what the bankers told the buyers and sellers of this stock on the eve of the horrendous ipo with something that freaked them out, both causing the sellers to dump and dump hard and the buyers to walk away or slash their buy orders. like any other company with a stock that keeps going down, we've got to adopt some rules here. so can we at least wait, wait a single quarter to see if maybe something's really wrong here?

can we wait for the end of the lockup period to see if insiders take even more money off the table? why do we need to mess with the facebook drama when social media's proven to be such a graveyard that no one's been able to whistle past it, at least so far? here's one. the drama that is morgan stanley. the banker for facebook. you might not know it, but morgan stanley's become a hellacious battleground between the bulls and the bears. it's a verdun-style slog with no letup. as much as facebook is, well, let's say top of mind and therefore morgan stanley's the top of mind banker, the real issue here is the company's balance sheet and how vicious will the upcoming ratings agency review be toward morgan stanley. three cuts? we don't know. morgan stanley's a place i've always loved, though. when i first came to wall street i applied there and goldman sachs and debated what should be better. 27 years later for many the

verdict's not in yet. despite the company's endless protestations, morgan stanley's perceived as the weakest of u.s. banking institutions when it comes to ties with europe. it's considered the one that ratings agencies are most concerned about. even as this firm has done more to shore up its balance sheet than any other major institution in the space. they've taken up a huge amount of capital. what a great band it has, one that's loved by venture capitalists and young companies and will continue to be adored even after the facebook fiasco. but the drama here is thick. there are huge accounts betting against this firm. they think the stock has much further to fall. >> sell sell sell! >> there are others who think morgan stanley could be the most undervalued stock in the whole group, though. >> all aboard! >> because of the tremendous disparity between its book value, currently pegged at $30, and its $13 share price. i ventured onto this battleground earlier this year, and it was at a higher price. i got the bullet holes to prove it. you just can't see them. morgan stanley was just too hard for this guy to call. i sure as heck don't like the

drama even as i do like the subject. now, here's the amazing thing about all these dramas. as any good english teacher will tell you, the essence of drama is conflict, and rimm, facebook, and morgan stanley all have conflict to spare. but i've got three solid plays that have no drama whatsoever. they're comedies, brilliant, well-orchestrated comedies with a real all's well that ends well feel, although in each case they are much ado about something, not nothing. remember, we're investors. we're not theater critics. which is why instead of research in motion you should consider verizon, which owns half of verizon wireless and sports a 4.8% yield. this company isn't bleeding subscribers. it's growing them. instead of being tethered to one variety of handset it offers all of them. verizon's got value and it's got growth. research in motion might have the first, and then again it might not if it keeps losing money. definitely doesn't have the second. instead of facebook may i suggest apple? did you see that company today? whoa. smoking. here's a company with tons of growth, a fantastic balance sheet, and incredibly low-priced earnings multiple. not a dollar amount but a low price to earnings multiple

that's well off its high. not to mention new products that could dazzle, including perhaps a siri-operated tv. can you imagine asking that knockout smoke show siri to please put on "mad money" only to hear her coo, "your wish is my command"? ooh, doctor! finally, do we need to get down and dirty with morgan stanley if you're going to own a bank that makes its money from actual banking, not complex financial derivatives and trading? i'm talking about wells fargo. which used the financial crisis as cover to grab almost 30% of the mortgage market at a time when making mortgages has become a terrific way to print money. here's the bottom line. hey. no doubt about it, drama could be great for broadway. but it's terrible in your portfolio. so don't think research in motion or facebook or morgan stanley, all epic stock dramas that could make you weep -- oh, yeah. waiting for godot. you know what i mean?

instead, go with verizon, apple, and wells fargo. these are all plays that will leave you smiling with a good feeling that makes you want to come back for more. now, that's my kind of entertainment. chris in new york. chris! >> caller: jim, i'd like to give a big boo-yah from muhlenberg college in allentown, pennsylvania. >> great group of trustees and many of my friends went there. how can i help? >> caller: linkedin was just upgraded to a buy today. how can you justify this for a stock trading at 600 plus times earnings? >> first of all you've got horse sense to ask that question. here's the dilemma people find when they're analyzing linked in. how many companies have 100% revenue growth for quarter after quarter after quarter for eight quarters? it's too attractive for the growth hounds to say away from. you and i care about earnings because we know what happens when growth slows down but you have to understand there's another cohort of people who go so lady gaga for growth that they can't resist. i want to go to victor in washington. victor! >> caller: hey, jim. it's vic. how are you doing? >> vic, i'm good. how are you? >> caller: good.

i was wondering about shippers and shipping in this economy. i own shares of two companies. diana container ships, dcix. and capital product partners. pclp. >> this baltic dry freight has seemingly gone down day after day after day. i want you to be very, very careful with that group. i don't trust it with this baltic freight going down as quickly as it has. as a matter of fact, it's really one of the most discouraging statistics out there that i get every single morning. so look, save the drama for your mama! these are some tragedies that should be saved for broadway. i like you in apple. i like you in verizon. i like you in wells fargo. you'll feel good for the rest of the year. hey, man, the iceman, he don't cometh. "mad money" will be right back. >> coming up, dash for cash? the markets plunged on european woes for the past month. but b & g foods' domestic

exposure has them heating up. could their portfolio of brands help feed your appetite for profits? cramer's exclusive with the ceo is next. and later, yearning for yield. feeling crushed from the market's wild moves? tonight it's time to fight back. cramer's playing defense as he zeros in on the top dividend performers over the past century to provide you the protection you need. all coming up on "mad money." we all know there's nothing more important than family. >> on june 15th we're celebrating our fifth annual edition of "mad money -- it's a family affair." >> once a year only. check it out. >> want to join cramer in studio for the special event? >> my brother and i are in a little brotherly dispute. >> the doctor's in the house. >> head to madmoney.cnbc.com for free tickets. >> the family that invests together stays together.

on a nasty day like this one i always like to look for stocks that were able to resist the savage european undertow which put most of our market through the usual meat grinders. i've been telling you to stick with high yielders that give you domestic security meaning they don't do much business overseas. sure enough all the averages were crushed today. b&g foods, bgs for all you home gamers, basically unchanged. b&g if you don't remember is one of the domestic security stocks i just recommended. you might recognize them as the company behind ortega or las palmas brand mexican food. cream of wheat. vermont plain syrup. b & m beans. b&g pickles among others. i like b&g for a number of reasons. first that delicious 4.6% yield especially versus 10-year treasuries. up 83%. since 2012 is looking more and more like 2011 that bodes well

for the future. the company has a fabulous track record of buying neglected brands from its largest competitors and nursing them back to health. plus b&g has given you about a 95% gain since i first got behind it in october of 2010. i think this is the ideal domestic defensive dividend name for this environment. but don't take it from me. let's talk to david wenner. he's the president and ceo of b&g foods. find out more about his company and its prospects. mr. wenner, welcome back to "mad money." have a seat. >> good to see you. >> thank you so much, david. now, since we talked last, you've made this acquisition. and it's in a different direction. i've got all of your terrific food products and every single person who is watching knows them. these are products that are also household names, but they're not food. and i want to know how they're doing and whether they're going to be the same kind of success -- actually, we have some that are food. same kind of success. and whether they're taking your company in a new and maybe larger direction. >> well, most of the acquisitions are food products. but you're right. this is a household product. and it's a direction we've been looking at for a while now.

mainly because when we look at food products we're looking at niche products that have very good margins, you know, things that we can defend against whatever competition there is. this is that kind of product on the household side of the ledger. very unique product. almost no competition whatsoever. very good margins. we think it has a lot of other applications. so we see room for it to grow. but it's what we do. and it's the same customers, the same trucks, the same warehouse. you know, there's a lot of synergies there that we can take advantage of. >> now, when i go into the aisle -- i mean, i go into these aisles, it's obviously spice aisle, you've got mccormick in there, very good names, but there's room. i go into this aisle. there's a lot of little companies and they seem to be all like mom and pop companies or maybe divisions that big companies don't think of. there are a lot of guys in that aisle that you can take over, aren't there? >> and that's where the opportunity is. as long as it's in a niche that's defensible. you know, i do not want to buy something that my competition is tied.

i have great respect for tide's power, and that's not what we do. >> but this is against mccormick. >> it is. but it's in a very defensible niche. mrs. dash controls 80% of the salt-free seasoning and has for a long, long time. mccormick has competing products that haven't made headway. so we looked at that and said that's got a very loyal following, very defensible, even though mccormick is the 800-pound gorilla in the seasonings. >> and no-stick baking. pam is in there. >> there's a lot of competition there. >> that's a household name. i had a party the other day and the caterer said where's your pam? didn't say where's your baker's joy? >> there's not a lot of sales here. glass half empty, glass half full. we're looking at this and saying we can do a lot better because this is one of the original products in the category. it's done very well since we bought it. we got it into expanded distribution in walmart. we think we can do a lot with that brand. >> now, my friend matt horwin who does my forensic accounting for me and first brought your excellent company to my attention when you had the hybrid said to me you've got to

ask, you've got to ask david, did you buy too much and is the balance sheet more stressed than you would like? >> did we buy too much? no. one of the management challenges we have as we build the portfolio is managing all these brands. and we think we're up to it. and that's part of my job is to understand how to do that. the balance sheet's actually in very good shape. we're leveraged about four times. but you really have to understand the cash flow underlying that. the interest to cover that leverage is about 25% of our ebitda, and very, very manageable. and we are ready today to do the next acquisition. >> you really are? >> yes. >> you're not concerned the dividends -- >> we still have very strong cash flow. and what we buy because of this very strict criteria we have is accretive immediately. i mean, the culver brands that we bought brought $28 million of additional cash to the balance sheet every year. we raised a dividend off of that $10 million. so we're able to raise the

dividend very comfortably, still put a lot of cash flow as a proportion of what we bought onto the balance sheet to fund that next acquisition. >> i do not see any commodities in this basket that are going higher anymore. >> no. and that's part of the magic of b&g in the last year, is we don't have tremendous commodity exposure. and what little we have we've done a very good job of buying ahead against. had to take very modest price increases to cover it and we've done that. >> i know you guys have a great relationship with walmart. if you get one thing in walmart, are they willing to listen in bentonville to having you take the others, or does it happen kind of natural? >> walmart's a case by case thing. we're not big enough that walmart is going to really listen to us. we have to tell the story for each and every one of these brands. and fortunately for us, they're very good brands. baker's joy ended up on the baking aisle in easter. even though we had a very short

fuse from when we bought it to when we got it in. so we're able to do that. but you've got to go persuade them. they're not going to just accept it. >> you've done a fantastic job. the thing i'm most thrilled about is it says here you're ready for the next one because the growth and the yield -- i mean, your dividend goes up and the yield goes higher, not because your stock goes down but because you're growing the dividend. you've done a fabulous job. it's one of the most mentioned stocks when i see people on the street. and i'm thrilled for that. thank you so much for coming on this show. >> thank you. >> that's david wenner, president and ceo of b&g foods. you're worried about facebook? you're worried about morgan stanley? you're kind of up in the air about research in motion? hey, you know what? just remember b&g. stay with cramer. >> coming up, yearning for yield. feeling crushed from the market's wild moves? tonight it's time to fight back. cramer's playing defense as he zeros in on the top dividend performers over the past century to provide you the protection you need.

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yesterday everybody was sure that something good just has to happen in europe. and our stocks, well, they rallied beautifully. but today we saw the other side of the equation, where rising spanish and italian bond yields

along with a discouraging poll out of greece sent our stocks tumbling. our market is like a seesaw that hinges day after day on the news out of europe. however, there's one good thing about the situation, and it's, well, we've been there before. this is exactly what the market was like last fall. so we know the playbook for dealing with this kind of roller coaster environment. >> sell sell sell! >> buy buy buy buy! >> unfortunately, we can't be isolationists or american firsters. because that would make us ignore the traumas of europe. he with know that's never right. but we can at least wall off some of the damage. how? with dividends! ♪ hallelujah yep, good dividend fences make good dividend neighbors. and they also make you some money. so as part of my endless attempt to inspire you and keep you from being run out on a rail by the jpmorgans and the facebooks of the market, to use those analogies, here's one more piece of evidence why it makes sense

to stay in this game. as long as you stick to my largely domestic dividend diversification program. i've said some of this before. but after a horrific day like today i think it bears repeating. we know dividends will help your portfolio survive, possibly even thrive in this lousy environment. remember, looking back over the last century, an astounding 40% of the total gains in u.s. stocks came from reinvested dividends. 40%. in other words, even in a decent market dividends are responsible for nearly half the average of a stock's performance. it's pretty amazing, isn't it? this is not a decent market. can you imagine how much it's going to account for? right now we're in a period where global economic growth is slowing. uncertainty about the future clearly on the rise. it's not a pretty moment. but we know empirically, thanks to a terrific study from morgan stanley, that during periods of slower growth, dividend-paying stocks have outperformed those without dividends. plus in times of uncertainty, stocks -- well, high-yield stocks become increasingly

attractive as relative safe havens for your money. and they have a trampoline effect underneath. speaking of safe havens, the safest asset class around, u.s. treasuries, right? they're giving you hardly any return at all. do you know the yield on the ten-year treasury hit its lowest level on record today. a puny 1.63%. even 30-year treasury bonds are only rewarding you with a pathetic 2.72% yield. at these levels, buying bonds, i'm calling them foolish. i am urging treasury secretary tim geithner right here, right now, to sell $500 billion in 30-year treasuries in order to sate demand from europe and put an end to any liquidity worries that might come into play if the world examines our deficit after dealing with the catastrophe that is europe. the truth is you can get a much, much higher yield from dividend-paying stocks and it will be taxed at a lower rate than income from bonds and of course there's the possibility that the company paying it might raise its dividend, something i guarantee you uncle sam will never do.

in fact, i bet we'll see a slew of dividend boosts in the not too distant future. historically u.s. companies have paid out an average of about 45% of their earnings in the form of dividends. yet right now the payout ratio is sitting at an incredibly low 30% because earnings have rebounded so strongly. our non-financial companies are sitting on record levels of cash and their balance sheets are pristine. that's a surefire recipe for higher dividends down the road. so given the incredible power of dividends, how do we go about devising a portfolio that works in this environmental? we want consistent companies, and that's why we started by looking at the list from the new york stock exchange century club, which recognizes successful american companies that have been around for the last 100 years. we heard about this club from one of our guests, kevin burke, the ceo of con ed, one of the most consistent companies around, when he came on the show just last week because con ed's a member. then we narrowed things down by looking at only the companies that had raised their dividend every year since 1980. only 19 companies.

so that's a good list. then we narrowed still further by looking for the companies that grew their dividends at the fastest compound annual growth rate. they call that cagr for sure. c-a-g-r. while also making sure to include a range of sectors because we like diversification. it gave us five stocks, five names that aren't just dividend aristocrats. they're -- ♪ -- dividend royalty! first of course is con ed. the new york city-based utility with a 4% yield. now, con ed is a transmission and distribution play, not a power generation utility, which means they don't need to worry about the e.p.a. unlike so many of the other higher-yielding coal burning like american electric power. one part of the country where residential construction is still thriving. which means more customers for con ed too. needless to say con ed like every other company on this list has a phenomenal record of raising its dividend.

just like conversion from oil to nat gas. i think it's going to make it pretty easy to raise the dividend this year for ed. second there's sherwin-williams. don't talk about it enough. the paint company. small 1.2% yield. but wow, terrific track record of dividend boosts having increased their payout at a 20% compound annual growth rate since 1980. we know from last quarter the paint business isn't strong -- it's strong. it isn't just the great weather. a lot of people are critical because they say it's strong because it's so nice out. uh-uh. we know this because inside paint is selling just as well as outside paint. plus their raw costs are coming down. a lot of things going sherwin williams' way. third, we've got abbott labs. the defensive drug company with 3.3% yield that's grown its payout at a 14% clip. and a stock i like for my charitable trust which you can follow along with at actionalertsplus.com. we'll tell you which pieces to keep after the split. the drug business and the diversified medical products business that are splitting, i think there's going to be a lot of value brought out. we do like both pieces. but you know what?

we're not sure whether to keep both longer term. as we get close to the split again, i'm going to tell you exactly what to do, and it will be not until the end of the year. so you have some time. fourth, pepsi! which yields 3.15% and has been growing that dividend by 12% annually for the last 32 years. pepsi's a classic turnaround story but the turn is only just beginning to become obvious. i think it's working but you're being paid handsomely to wait until everyone knows it. where was i going here, pepsi's declining raw costs, think gasoline for trucking their products to the stores. gain prices for frito-lay. come on, think about the stuff that goes into frito-lay. packaging costs coming down for their cans and bottles as well as energy used to make them. they use a lot of energy to make this stuff. it's all going pepsi's way now, and indra nooyi, the ceo. love you, jim. i think she meant to write go phillies. forget about them.

she's going to put them in their place, show you how wrong they are the next couple of quarters. plus pep has much less international exposure than coca-cola, which means it's also a domestic security play. finally there's target which yields 2.1%. not a super high dividend. but it's grown the payout by 11% annually since 1980. very fast dividend growth. remember, that was one of our criteria. this stock like walmart has moved up too much of late but because it's totally domestic as well as being a great play on falling gas prices and lower food inflation, it remains one of the best go-to names in the space. here's the bottom line. in this turbulent market you need dividend protection, and that's where con ed, sherwin-williams, abbott labs, pepsi, and target come in. all companies with terrific records of dividend boosts going back more than three decades. however, these stocks should only be bought on a european-inspired dip like we had today because they have little to nothing to do with europe, which means the only reason they went down to begin with is because they're part of the s&p 500 brought down by the futures.

that's the definition of a bargain. and you know this market will give you plenty of those as long as you remain patient and ready for the inevitable greek tragedies that seem to cause havoc around the world each week. let's go to dan in louisiana. dan! >> hey, jim. let me first of all give you a big raging cajun boo-yah from down here south louisiana. >> lafayette, pal. >> caller: yeah, down here in lafayette. come down, we just recently voted the best place for a good meal in the south. >> i believe that. i'm letting the bon temps roulez thing happen. what's up? >> caller: i have a two-part question, sir. the first one is do you have to own a minimum number of shares to qualify to receive a dividend? and then the second part of my question is if you could please distinguish between like the ex dividend date, the record date, and when can you sell your shares and still receive the dividend? >> you don't have to have a certain number of shares and there's a -- what i'm going to

do is i'm going to send you to my book, to my last book, which gives you all the pay dates. it's a very complicated series of things. and i want everyone to know what the pay date is, what the ex date is because it's very complicated and i don't want to just be glib about it because you've got to write it down and read it. but it's a great question and i want you to know exactly when to buy and i'm not going to just cuff it here. let's go to avi in florida, please. avi. >> caller: hey, jim. big sunshine state boo-yah to you. how are you doing, buddy? >> real good. how about you there, partner? >> caller: not bad. thanks very much. i had a question about nct. newcastle. >> right. >> caller: it's paying a huge dividend and it's up a little over 40% so far this year. what have you got for me? >> well, i've got to tell you, this is another one of these situations, i know people get tired of hearing me say it, but the one thing i will never do is recommend a stock that's like this with a 12% yield unless the ceo comes on this show and describes to me what he or she has within that company because

i can't make a determination and i can't cuff the decision. what do you get when you combine history, track record, european resistance, and yield protection? you get cramer's dividend royalty! and that's con ed. it's sherwin-williams. it's abbott labs. it's pepsi. and it's target. please, wait for the dip and stay with cramer. >> coming up, the clock is ticking. call cramer at 1-800-743-cnbc to find out how to fire away at cramer on the "lightning round." can he withstand your thunderous onslaught of stocks? and later -- how do your stocks stack up in a mystifying market? cramer makes sure your portfolio makes the grade on "am i diversified?" all coming up on "mad money." [ male announcer ] the inspiring story

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it is time. it is time for the "lightning round" on cramer's "mad money." rapid-fire calls one after the other. say the name of the stock -- buy buy buy or sell sell sell. my staff prepares the graphics on the fly. play until you hear this sound [ buzzer ] and then the "lightning round"

is over. want to start with diana in california. diana. >> caller: hi. what do you think about qualcomm, ticker symbol qcom? >> all right. qualcomm is a great play off of apple. i think it's inexpensive. but people want dividend and they don't want europe. and qualcomm is not there for the play. let's go to marco in new york. marco! >> caller: boo-yah. what's up, buddy? this is marco from brooklyn heights. how are you doing, jim? >> man, i'm loving brooklyn heights. i lived at 312 hicks. what's going on? >> caller: i mentioned a couple times here some wedding events. how are you doing? >> i'm fine. what's going on? >> caller: i wanted to know what you thought about ctrip. >> come on. i thought if you live in brooklyn heights you have horse sense. >> sell sell sell sell sell. >> we're not recommending anything in china. too dangerous. how about ron in virginia? ron. >> caller: hi, jim. boo-yah to ya. >> boo-yah. >> caller: how about hartford financial, h.i.d.? it's selling at almost 50% of

book value. >> it's very cheap but if i want to buy something at 50% of book value i'm going to go to aig and robert benmoshe. william in michigan. >> caller: sips financial international. sfl. buy, sell, or hold. >> chartering ships is too dangerous a business. i have a hard enough time recommending n.a.t. this one did just spike. michael in arizona. michael. >> caller: new york giants fan living in arizona. and my ticker symbol is bud, b.u.d. >> i think it's a terrific situation. precisely the kind of stock i'm looking at in this unstable environment, although it does have international exposure obviously. let's go to greg in virginia. greg. >> caller: jim, big boo-yah from the mountains of virginia. thanks for turning my portfolio from mean to green. >> that's what i want to hear. >> caller: mid states petroleum. >> too dangerous. i think it's stopping here but

if the dollar keeps going higher people will take oil to $80 and that means that stock will go lower. alan in my home state of new jersey. >> caller: jim. in boston. know how much you love the city. wanted to talk you about amarin. >> nice spec. let's put it that way. it's a nice spec. i said it before on the show. i'm going to reiterate. because i like biotechnology. it doesn't have any economic exposure. let's go to jim in wyoming. >> caller: hi, jim. a grand teton boo-yah from jackson hole, wyoming. >> an exum ridge boo-yah right back at you, partner. >> caller: i'd like your views on wolverine worldwide. www. >> there's a shoe bull market and www is very much a part of it. why am i saying buy buy buy? because it has had such a run. we are going to wait for a pullback and indeed we will -- >> buy buy buy buy buy! >> and that, ladies and gentlemen, is the conclusion of the "lightning round"! >> the "lightning round" is sponsored by td ameritrade.

remember the days when you were a kid when roller coasters were thrilling and seesaws were fun? this market over the last few months has been crazy. crazy wild. not so fun ride. enough to make investors sick. part of my job is to help remind you you can still make money if you follow the rules of smart investing. which includes doing your homework, buying quality dividend companies like the ones we always go over on "mad money," and of course making sure you wall off as much damage as possible, making sure your portfolio is well diversified. and, that ladies and gents, is why we play "am i diversified" and why it's so important. this is where you call or tweet me @jimcramer. you tell me, like 522,000

people, you tell me your top five holdings and i tell you whether your portfolio is diversified enough. we're starting with a tweet from @maavdanny. he wants to know about energy transfer partnerships, etp, devon, dvn, panera, the restaurant company, aig, and lam research. and he says jim, am i diversified? this is just the topic i have been going over on twitter, and in my realmoney.com columns for the street. and that is, are two of these companies the same even though they're not? let's go over this. panera. terrific restaurant chain. aig. actionalertsplus.com charitable trust name. bob benmoshe is saying great things. i agree with him. lam research being a semiconductor equipment company. devon and energy transfer. this guy loves action alerts. these two are different. this one is a pipeline. this one is an oil and natural gas company. but they're trading together.

and we have to recognize that. which is why unfortunately i have to sell one or the other. energy transfer yields 8%. i'm not going to sell that one. so we're going to say no for devon qualitatively but we're going to swap pepsi for energy transfer -- i mean for devon. why devon? energy transfer's got yield and i think it bottoms quicker. they trade like oil companies. hey, let's go to phyllis in california. phyllis. >> caller: hello, jim. >> yo-yo, phyllis. >> caller: i'm phyllis from sunny san diego. >> i love that. geez, the padres. easy outs. what's up? >> caller: where do you get your energy, jim? >> i get it from my dad and i've got to tell you something, i am really raring to go today. so let's go to work. >> caller: my five are aapl, apple. >> apple. >> caller: abt, abbott labs. csco, cisco. m.e.t., metropolitan life. and sre, sempra energy. what do you think? >> san diego energy company. whoa, whoa, whoa. all right. let's go to work here.

phyllis has got a real interesting portfolio. first metlife, terrific insurance company. not my favorite. if i want a pure insurer i'm going to go for aig. sempra energy, great utility with a 4% yield. don't have that. cisco, not my favorite tech. abbott labs splitting into two, fabulous dividend record, definitely a keeper. charitable trust name. apple a charitable trust name. we've got a tech, insurance, energy, drugs, and another tech! no, we're not going to allow that. that is just verboten. what we'll do is we'll add -- let's see. let's do some thinking. i think this portfolio could use -- i think it could use disney. that's right. is that like any of these other companies? no. and i think disney may be the antidote to kind of like -- it's got so little to do with the rest of the portfolio, which is what you really want to do, and that's the change that has to be made by phyllis, and then she

will be in great shape. let's go to mary in oklahoma. mary. >> caller: hey, jim. a great big elk city boo-yah to ya. >> definitely. what's going on? >> caller: i've got my five stocks for you. abbott labs. abt. >> yeah. >> caller: american electric power. aep. >> okay. >> caller: main street capital. main. mark west energy, mwe. and sandridge mississippi interest. >> oh, boy. confronted with a portfolio that has so much yield. normally i'd relent. but not if they're all in the same sector. so get this. american electric power. great article in the "wall street journal" today about getting out of coal and the pressures that he feels. he's a biology guy. he's good. abbott labs, drug company. we're all over that. main street finance. special finance. that's okay. sandridge and mark west no, they're two oil companies who can't do it. so i'm throwing in disney and taking out -- no. take out sandridge. too risky.

and then we've got -- ♪ hallelujah well played by everyone. but please make those changes and make them tomorrow morning. stay with cramer. what is that? oh, we call it the bundler. let's say you need home and auto insurance. you give us your information once, online... [ whirring and beeping ] [ ding! ] and we give you a discount on both. sort of like two in one. how did you guys think of that? it just came to us.

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it's time for a quick reality check. shouldn't we be jumping for joy that oil's going down? isn't the plummeting price of crude what makes us think that many of the retailers and the restaurants can be doing better than expected? less money spent at the pump means more money that can be spent elsewhere. do i have that right?

lots of stocks beyond just restaurants and retailers could be winners from cheaper oil too. hotel companies benefit from additional travel. casino companies particularly in vegas could benefit because it costs less to drive to these destinations, saving money. even home-building companies might be winners because many housing developments are located far away from where the jobs are. that was part of the housing crisis. lower gas prices make longer commutes more palatable. there's only one problem. gasoline prices aren't actually going down the way they should. some areas they're not going down much at all. others they aren't even going down. see, gasoline isn't merely a function of the price of oil. it's a function of, one, what kind of oil you're using. and two, what's the cost of refining that oil? first, we price our own gasoline off brent crude, the european price, which even after this huge decline in oil is still over $100 a barrel. $103 last looked.

the west texas price you often see quoted, it's almost completely irrelevant to the price of gasoline for most of the country. second, there simply isn't enough refining capacity on either coast to turn that lower-priced oil into additional gasoline. the price of gas isn't being propped up artificially, though. it's because companies have been closing refining facilities left and right. refining has been a terrible business for so long that companies like sunoco, bread and butter refiners have been in the business for ages, have virtually given up on it, lost billions. the cost of modernizing these facilities and making them clean enough to pass muster is simply too prohibitive. so many places, especially california but also the northeast, gasoline has barely budged from higher levels or gone down just a couple of pennies. which brings me to the real issue. actual relief from the price of crude oil. the only way we're going to get the price of oil down to where it's not an immense tax on the american people is by offering an alternative to oil. namely, natural gas, $2.40. i can't believe this thing. last time we heard from peter

mccausland. he's the retiring ceo of airgas. who told us his company's debating converting its immense fleet of trucks from diesel to natural gas-powered engines. 25% of the oil we import goes to making diesel fuel for trucks. you want to see the price of gasoline come down? forget about building more refiners. it ain't going to happen! the best way to do it would be to have the government encourage the use of nat gas vehicles. just point blank say it. further, we want oil use to go away from cars too. last week we heard from con ed. there are still thousands upon thousands of buildings in this country, 7,000 in new york city alone, that are still heated by oil. how about a little credit to get the building switched to natural gas, get trucks switched to natural gas, and you'll find yourself with so much unused oil capacity that the price is bound to come down huge in this country. right now we're hostage to the whims and finances of a few refiners. with a little encouragement we can break that chain entirely. but do we have the will? right now neither presidential candidate's taking a stand on this particular issue. i bet the winner in november could be the candidate who says

he can smash opec, clean the skies, and bring jobs to keep swing states like ohio and pennsylvania simply by saying the nation's fuel should be natural gas, and we'll incentivize those who switch. only then will the cheaper gasoline-inspired boom really be possible. stick with cramer! [ male announcer ] we imagined a vehicle

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