i'm jim cramer. 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! >> 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 want more days like today. my job is not just to entertain you but to teach and coach you. so call me at 1-800-743-cnbc. too many people are mystified by this market. too many people are thrown off by the bounce-back we had from

friday's hideous employment number, or the reversal we experienced midday today which allowed the averages to close in the green. the dow gaining 48 points. the s&p climbing .63%. the nasdaq advancing .57%. so tonight, right here, right now, i'm going to explain it all. in english. and place it in the context that you can understand. the first and most important issue behind this rebound, we have a massive inferiority complex in this country. ♪ we simply don't believe in ourselves, and we certainly don't believe in our companies and their ceos, especially not ron johnson, who was fired tonight from jc -- who is stepping down from the ceo job at j.c. penney, and not a moment too soon.

something we will certainly address later on when we remove his ignominious visage from our own wall of shame. we do however believe in our president, and when he says as he did as recently as four weeks ago that the u.s. economy could collapse because of the sequester, he does have the ability to freeze hiring and frighten people beyond belief. did he use the term collapse? i heard the same thing you did. which was to be afraid. be very afraid. now, i didn't know how badly the nation's business psyche was hurt by the president. president obama's endless pronouncements. even as one of my favorite columnists peggy noonan hailed him as the fear monger in chief. the vast majority took the president seriously when he warned of chaos and gigantic layoffs. think about it, are you going to apply for a loan to start a new business if you know there are going to be layoffs that could

rival those of 2007 to 2009? are you going to hire more aggressively even as the federal government is firing more aggressively? is this the time to hire more salespeople for a technology company when the government -- a huge customer has to cut back on its orders? do you want to be in the travel business when the transportation secretary says the lines at airports will be so huge that it clearly discourages travel? i don't talk to just business people, although to a person they were scared. i own an inn in summit, new jersey. when i heard the warnings, well there goes our numbers. i guess we'll be empty like everybody else. any town that relies on the military's largesse had to be hit hard. the richmond fed which deals around washington, d.c. came out with data that said that business decelerated last month. the justice department are saying they can't prosecute as many bad guys as they would like because these layoffs are so drastic and devastating. i guess the rest of the economy

has to fall apart, because the fed's retrenching. well, as it turned out, the hammer the president warned of never hit and it seems that the fear has subsided. with that, confidence might come back a little. i saw a line at reagan airport yesterday that curved around, most of what happened hasn't happened, at least yet. most people and material that it was manufactured to get congress to make a deal. while there will be more sequester layoffs, it's possible we may get a bounce-back, ex-federal employees. we are real down on ourselves. you know that and i know that. we all know that washington is totally dysfunctional. that makes us feel -- both republicans and democrats alike. no one is excluded. we have the -- we know that jobs are hard to find. we're only building two-thirds the number of homes of a few years ago. more companies would rather pay overtime to existing employees than hire new ones.

perhaps they fear running afoul of the affordable care act. the small business creation isn't happening in this country that we can tell. but as inferior as we might believe we are, you have to look at what's happening overseas to understand why i say our complex is causing us to misjudge the strength of the stock market. because we feel inferior we think our stock market is inferior. first, despite a belief by many of the wealthier people in this country that the president is only a few inches from being confiscator in chief, it wasn't our country that put forward the concept of taking a huge cut out of bank deposits the way the european union was willing to do to those depositors in cyprus. if you're wealthy in europe, would you really keep your money deposited in a bank that perhaps tomorrow the european union might say should not be insured?

why not send that money to the u.s. banks? wouldn't you rather worry about a return on capital than a return of capital? no one in the world would contest the idea that our banks are the soundest on earth. no, the treasury department forced them to raise the equity. does anyone mistrust the fdic in this country? i sure don't. if you're a wealthy european all you have to do is wire the money into the a bank. except for the pension funds. they should consider buying real estate now that capital gains won't be taxed as they have been since 1980. how about if you're in china? do you think china is doing better -- boy, that fxi, what a horrible head and shoulders pattern that is. i think china is struggling. more important, if i lived there, i would fear unrest. i can get my money out of china, put it here, real estate in particular. u.s. banks in general.

i'd be thrilled. now at a certain point i think china has to bottom. it could be pretty soon. i saw copper trade up higher today. if i lived there, send the money here. come on, right? finally, there's the japanese. i think that most americans really and truly do not understand what has been happening in the last few weeks in japan, because it's frightening. if you have any wealth at all, it is frightening. you see the government there has decided that it's going to print yen more aggressively than i have ever seen a developed country inflate in my lifetime, of course previous to my lifetime there were countries that did this. we don't need to go into them. the japanese government, they're buying everything. they're even buying etfs. can you imagine the federal reserve board deciding to buy our etfs? ben bernanke says give me some of the retailers, or hey, hey, take the xlf, get some of the bank stocks higher. how crazy would that be? that's what's happening. we have etf buy numbers out of japan that shows how much

they're buying. i can't imagine a rich person wanting to keep his money in yen if the central bank is embracing that idiotic inflationary strategy that aggressively. during the 1980s, japan's stock market roared and roared until it dwarfed our own and real estate in japan far exceeded the real estate in manhattan. tokyo much more expensive than manhattan. some parts are but not the rest of the country. the japanese ruled the financial world in the late '80s. every morning i'd come in and watch the money flow into our stocks. usually at about 10:00 each day from japan. it was so predictable that a lot of us would simply buy stocks at 9:30 and flip them to the japanese at 10:00. well, guess what. it's back. i'm seeing it. i'm hearing it every day. the japanese are once again in buying just like the old days. you just had to be trading in the late '80s to remember this. they're not just content to buy our treasuries.

they want stock equivalents in the utility to high yielding drug and food stocks. this is like '86 to '89. a waterfall of money coming our way. why don't we see it? because we think we're so dysfunctional that we can't believe anyone would covet anything we own. but we don't understand that our property rights remain inviolate in this country. our fed chief is revered and our democracy and freedom including the freedom to be rich distinguishes us right now from pretty much every other country on the earth. here's the bottom line. our american inferiority complex is lining up to what's driving the stocks higher. the wave of money that floods our markets every day. don't get out of the water. surf it. the tide is going our way. larry in massachusetts, larry? >> caller: good evening, rabbi cramer. how is the soothsayer of summit tonight? >> i don't know. all i can tell you is that the bosox look a lot better than the phillies. >> caller: i suppose so.

i was down in citi field last year -- citizens field. it was a rough night for doc, let's put it that way. >> well, it's kind of citizens morgue. it's really incredible what's happened there. i was crying last night. we came back within one run -- never mind. >> caller: there's always hope. >> yes. >> caller: tell me about yum and the avian flu. i weathered the storm of the chinese cleaver in january, and yet, we have got another one now. i scaled out last week but i'd love to know with a 1.03 peg when you like us to get back in? >> well, all the chinese related stocks traded up today, and i think that yum was part of that. stephanie and i sold our yum. we said maybe in the low 60s we'll go back. this avian flu thing crushed the stocks the last time. probably a short duration. i can't be in yum. the numbers are too high right now. keep your eyes on the money

that's flowing into our great country. yes, our great country, it's driving higher. i know, we had a lot of fear. we had a lot of fear. but i think it is subsiding. don't be blinded by the american inferiority complex. "mad money" will be right back. coming up, sweet spot? a big buy in the oil and gas business sent shares across the space higher today. but which of these companies have real potential, and which are running on empty? and later, fantastic formula? all this week, cramer is taking a microscope to big pharma to find the healthiest plays. tonight, a street downgrade of these shares that investors are reaching for the tylenol, but could the pain be relieved soon? plus, new construction? some new stocks are planning their street debut this week including one of the first to enter the red hot housing market in a decade.

but are these companies built to last or could these offerings fail to find a foundation? all coming up on "mad money." the "mad money" back to school tour is in session, and this time we're headed to the city of brotherly love. if you're a student at villanova university and want free tickets to see cramer do the show live on campus, thursday, april 25th, visit madmoney.cnbc.com. don't miss a second of "mad money." follow @jimcramer on twitter. have a question? tweet cramer #madtweets. send him an e-mail to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. miss something? head to madmoney.cnbc.com.

general electric gets it. today, ge paid $3.3 billion for a stock we suggested would get a takeover bid -- lufkin.

because ge wants to dominate the oil and natural gas service industries. i have liked lufkin ever since i want to the bakken shale two years ago. we stood in front of the nodding donkeys. it can be shipped to where it is needed. it's a crucial part of the oil and gas food chain that is indispensable to getting it out of the ground. you have ge -- yeah, ge gets it and they made you $24. or 37.6% just today. that's right. today. if you anticipated this acquisition. now, we would not spend as much time talking about oil and gas in this show if this didn't make you the kind of money that i have seen so often, whether it be lufkin, gardner denver.

okay, that was another oil service company take private, and at a nice premium by kkr. another outfit that understands this revolution can make you so much money at home. the reason the money is being made is simply because the opportunity is humongous. on "meet the press" this weekend, i discussed the need for the keystone pipeline to be permitted if you wanted high-paying jobs including unskilled ones to be created. take a listen. we've got tons of oil and gas, in the wrong places. you put the people to work on the pipeline, $60,000 is the minimum you pay. you'd put people to work all over this country. i emphasized that it can bring back manufacturing jobs which we need in this country. jobs are being exported to places that have higher energy costs than we do. that eliminates some of the edge these countries have in lower labor costs. no, i still don't think people understand how big this is. they don't understand how big the opportunity is.

i know this because i couldn't believe the outpouring of incredible venom toward me. i mean, vicious @jimcramer on twitter for my embrace of these positions. hey, maybe some facts would help. 9.6 million full-time and part-time jobs are currently involved in the direct and indirect production of the oil and natural gas. that's about $580 billion in annual labor income and the sector itself is responsible for more than $1.1 trillion in value added. call it 8% of our gdp. these numbers are growing rapidly as more finds are announced, more oil is brought out of the ground. to me the bigger issue is the multiplier. this is what people don't understand. this is why people are so wrong about this industry. for every one oil and natural gas sector job created, the american petroleum institute says 2.7 jobs are supported in creating materials, technology, and most important petrochemical

plants and equipment labor. that's why i believe keystone could create as many as 60,000 high paying jobs. i know many people doubt any figures from an industry derided as a real enemy of mankind. fossil fuel promoter. although natural gas is cleaner than coal which it often displaces. you can doubt the industry all you want. just go ahead. you can doubt all you want on climate change for certain. i do. but don't doubt them on jobs. because of the massive amount of work and prep we have had to do for our visits to the bakken shale in north dakota with continental resources howard hamm and the utica shale with aubrey mcclendon, who was dead right when they said that natural gas would break out in this spring, 2013. we did too much work on this thing. it's like empirical. we saw the difficulty of getting enough people to work in north dakota as we flew over it and couldn't believe the man camps we saw. the hardship in trying to get a hotel room near the utica shale.

these are vibrant parts of our country. if people only knew or washington would embrace the oil and gas revolution, then these positions could be filled by those who are so desperate to get jobs but happen to live in the wrong places in a country where mobility has become an intractable issue. you and i know that. we know that the natural gas is increasingly gaining here. not just for power plants but as a surface fuel. and we believe it's only a matter of time before the trucking companies embrace westport and cummings engines, the way that waste management has. in part because it's cheap and in part it reduces particulates in the air and it would cut back the use of diesel by leaps and bounds. remember, they import 25% of the oil. we could reduce that dramatically, maybe to nothing. how can you profit from it? we know the earnings are going to be fine. not going to be great, why, because schlumberger has told us it's so cutthroat. of late, it means nothing to

jeffrey immelt, the ceo of general electric who last week penned a piece on linkedin entitled game on. shale gas could ignite manufacturing, lead to energy independence, end quote. i expected ge is going to do much more buying in this space because of its multiple prongs. everything from ge locomotives which are tested with westport engines to the natural gas turbines which so many utilities are switching to. along with the new global research center in oklahoma city, they're creating state of the art technologies to harness this energy. what will ge do next? let's see, they had a stake in the artificial lift business that lufkin dominates. they have stakes in pumps, cng technologies as well as water management technology. given that lufkin extended ge's exposure to lifts what could extend the rest of ge's reach? first i'm thinking fmc technologies which makes processing technology along with fluid control equipment. natural fit, natural compliment to ge's existing pump business.

this is a $12 billion operation. it would be too big for most companies to swallow, but not for ge. second, chart industries. dominant maker of the equipment that liquefies natural gas. cryogenic equipment. it is performing fabulously. you can win it on earnings or a takeover. this one is only $2.3 billion, rounding error for ge. if ge want to boost the water management technology, they can buy clean harbors, a company that cleans up the water. and finally if ge wants to buttress the research only one independent company can leapfrog them to the top and that's the $6 billion core labs. they own the intellectual property that allows for the big oil players to make these gigantic finds that are keeping production growing.

by the way that's the lifeblood of stock appreciation. so here's the bottom line. we are in the infancy of this oil and gas revolution with multiple shales being exploited. perhaps the biggest ones yet to be discovered, i have to tell you in california. they're out there. ge wants to be number one in this business. as it is in so many other businesses, and lufkin is a step towards that dominance. but a purchase of fmc technologies, chart energy, clean harbors or core labs would cement that leadership. i'd never recommend a company stock on this show as a potential takeover candidate if i think the fundamentals are faltering but all four of these companies are doing just fine, and they make for terrific targets for ge and its game on quest to further the energy revolution. buy buy buy. let's take calls. lloyd from illinois. lloyd? >> caller: cramer, lloyd from southern illinois. >> what's shaking? >> caller: i have got cds coming out, they've matured. i'm looking to get more bang for my buck. the two stocks i'm kind of

considering is schlumberger and kinder morgan partners. >> this is an easy one for me because you mentioned the cd rollover. cds from 2006, 2007, you were getting 6%. now you're getting 0.6%. that's untenable. buy kinder morgan and i think foreigners are coming in and that's how good that is. sandra in ohio. >> caller: hi. boo-yah to you, jim. thank you for having our backs. please give me your opinion on national oil varco. >> i think it's a buy. we got shaken out of that. stephanie link and i, co-portfolio manager, it is so, so hard to own because it trades so wildly. i was going to mention this as a possible candidate for ge to buy. but i worry about the quarter. wait for the quarter and then maybe we'll do some buying. oil and gas revolution was booming today, thanks to ge's acquisition of lufkin.

a company we saw up close and personal in north dakota, fmc, chart industries, clean harbors, these all make a lot of sense. i want to tell you, i think that ge is going to be buying them like crazy. i think you should be buying them too. stay with cramer. coming up, fantastic formula? all this week, cramer is taking a microscope to big pharma to find the healthiest plays. tonight, a street downgrade of these shares had investors reaching for the tylenol. but could the pain be relieved soon?

for the last two weeks i have been talking about the past and future of pharma. doing some reminiscing about the 1990s when the big drug names used to trade like turbo charged growth stocks that they were and then highlighting some of the biotech stocks, because they could have the spectacular growth going forward. but after two straight weeks of telling you about big biotechs like celgene and gilead or small ones like sarepta, isis and immunogen, i don't want to leave you with the wrong impression. it's not that growth biotech stocks are good and slow growing big pharma names are bad. that's what i call a false dichotomy. the truth is a little more complicated.

the big pharmaceutical companies may not give you the rapid growth they had in the '90s, but they give you something else that's really important. they give you big, bountiful dividends that therefore transfer into high yields. i'm not trying to make your portfolio overdose on drug stocks here, however, you always need a high yielder in your portfolio. that's especially true right now when interest rates are this low. never thought they'd be this low in my whole life and will likely stay that way for a long time, thanks to ben bernanke. we got that hideous jobs number. the parlor game of guessing when it's over is over. as long as the fed is keeping the rates low, investors are looking for a yield like a cd that rolls over. the returns from those cds are laughable. and that leaves dividend paying stocks. hence, one of the major reasons why big pharma has been on fire lately. these stocks tend to perform better when the economy does poorly as investors search for

safety. that's another component of this big pharma rally. the market was anticipating a lousy jobs number, so it drove these stocks higher. i have to tell you, i don't think it's over. it's going to take some breathers. so with that in mind, i want to take a closer look at big pharma this week, because the large drug companies are not all created equally and because many of you own these stocks. these are bedrock portfolio names for you. let's start off with one of the favorites in the space. i'm talking about johnson & johnson with the bountiful 3% yield. better than 30-year treasuries, even without factoring in frankly the tax treatment for dividends. china has a aaa balance sheet, what country is that like? i like j&j so much i own it for my charitable trust. i'm anxious to buy more after that jpmorgan downgrade this morning. it was one of those downgrades

based on valuation, i'm tired of hearing those. meaning the stock has moved up too fast. i find that premature. why do i disagree with jp morgan? simple, j&j is a big, messy company. it gets 38% of the sales from pharma. 41% from medical technology as well as 21% from the consumer products division. i think it's a classic case of a business begging to be broken up. j&j's pharma business has appeal here and the money managers are getting a higher valuation than the combined company does right now. meanwhile, the medical device and consumer parts of the company, they have a completely different set of cohorts. the wall street fashion show likes the stocks simple. right now, j&j is complicated. but if it were to simplify

itself via breakup it would get a higher valuation. the downgrade to j&j is at a premium to where it would trade if it would break up. the sum of the parts. that's much more value to be unlocked than anyone would believe. j&j is the best example of a stock that can explode higher and then go higher still after we have the pieces trading. plus for years j&j was mismanaged. under the unfortunate leadership, what a diplomat i am, bill weldon, the company got hit with a host of product recalls, especially the consumer products business. hey, some of these things were taken off the market forever. well, it seemed from ever, as long as it took perigo to get the market share and the stock lagged the rest of the group. but weldon left the group a year ago and he was replaced by alex gorsky who was widely viewed as the brightest young star in pharma. when you get off the table and get off the desk with pharma executives, they talk lovingly

about gorsky. since then, j&j has been getting the house in order. and considering that he took over a year ago, you're getting a 26.7% return. i think this move is far from finish. j&j is trading at less than 15 times earnings. the average consumer staple companies can't grow as fast as j&j when it gets its groove back. granted, j&j still has issues including the big fda mandated recall of an orthopedic device back in february and a ton of lawsuits for its artificial joints where i would say from my legal training the company have some real bad facts on its side. but that doesn't seem to put a lid on the stock. however, the company has been doing a bunch of smart things. j&j closed on the acquisition of sinthis, the walmart of medical devices, expanding the orthopedic offerings, giving them more exposure to the trauma business.

j&j has a gigantic medical device pipeline. this division is looking better by the day. that said, the most important part of the company is the pharma business. i wish they'd spin it off as an independent company. they're so far over the patent cliff that people have already decided that it's splat. many of their biggest drugs have lost patent protection, went generic. and the pharma division here is once again growing. j&j is a rapidly expanding oncology business. last quarter, their anti cancer products were up. myeloma and the prostate cancer drug which i think has a potential to be a blockbuster. and diabetes, that's a raging illness. they just approved a drug for type ii diabetes.

and plus they have the rights to xarelto. an anti-clotting drug that reduces the risk of strokes. it breaks up the blood clots and the fda just rejected it as a heart attack prevention medication a couple of weeks ago. i think it can do over a billion dollars in peak sales. beyond that, j&j has a healthy pipeline. they have a hepatitis c drug, a leukemia drug and rheumatoid arthritis drug. i think you want to own the stock ahead of that meeting. buy some next tuesday when j&j reports its next quarter. you know what everyone is saying to me the quarter is going to be ho-hum. i don't think the quarter is important frankly. but if it knocks it down when it's announced, i mean what a great opportunity to pounce. i do not expect this quarter to be the breakout that a couple of people are looking for. so here's the bottom line. even after this run, i think johnson & johnson could be a terrific break up play as the

pharma is growing much faster than the rest of the company. if it were to be spun off, it would get a substantially higher valuation. j&j is paying to unlock value with the juicy dividend, 3% yield, which the company will most certainly raise as they have done for the last 50 consecutive years. don't move. "lightning round" is coming up next. the "mad money" back to school tour is in session. and this time we're headed to the city of brotherly love. if you're a student at villanova university and want free tickets to see cramer do the show live on campus thursday, april 25th, visit madmoney.cnbc.com.

he's out! yep, ron johnson, the errant ceo of j.c. penney, who destroyed more value than anyone i recall,

is history. not a moment too soon. we put ronnie on the wall of shame back in february 28th, urging him to spend more time with his family back in california for the good of the brood as well as for the brooding shareholders. i'm calling this a win for the johnsons and the penney people. mike goldman, the man so mistreated by johnson is back. at least in the interim. he can do no worse than johnson. i felt hope for the people who are work at j.c. penney that ullman can save the company. even though they lagged the stocks of other department stores at the end of ullman's tenure. now, it is time -- it is time for the "lightning round" on cramer's "mad money." that's where we take your calls. buy buy buy, sell sell sell. ♪ are you ready skeedaddy? let's start with will in tennessee. will? >> caller: hey, jim. boo-yah from arkansas alumnus living in nashville. >> what's up?

>> caller: the stock is tri. i've been buying it for the last year. i worked for thomson reuters and i'm maxing out the employee purchase plan. is that a good plan? >> i think it's a steady business, i think they're a long-term winner. that can be controversial for some. but i praised them in the speech i gave on saturday. and i reiterate it. let's go to costa in pennsylvania. >> caller: boo-yah cramer! >> yeah, exactly. >> caller: you are a machine. >> a lean mean fighting machine. >> caller: that's right. nextera energy, i have had it for four years i love it. >> well, i see -- got a yield, okay. i wish it would come in at 4.5%. we need to go to joey in new york. >> caller: hey, what's going on, this is joey calling from baruch college in new york city. >> good for you. horn college, good luck. >> caller: i'm asking about mens wear house?

>> i like mens warehouse. they have to stay consistent. i'm banking on this next quarter to be good. i need to go to johnny in california. >> caller: czech republic boo-yah, cramer. >> university kids, we love them. what's on your mind? >> caller: if the market pulls back what do you think about ipg platonic? >> lasers, medical lasers, lots of different lasers. i'm going to go with jdsu. let's go to andrew in virginia. andrew? >> caller: this is andrew from the college of william and mary investment club. >> how many kids at college watch tv these days? thank you for calling. nova, we'll be there. i hope you'll be there. >> caller: thank you. we were wondering if you had any insight on the stock rainer, ticker ryn. we're thinking of pitching it in an upcoming stock pitch competition. >> i wish the yield were higher. the stock has moved up too much. but that said it's a high

quality play. may i just point out that i like weyerhaeuser more, wy. the better investment. i'll take another call. jim in pennsylvania. jim? >> caller: hi, jim. boo-yah. >> boo-yah to you. >> caller: what do you think about suntrust? >> i think i have sellers remorse. my charitable trust, we decided to sell this stock and build up the other banks. ever since we sold it, it's been a rocket ship. it's killing me. take one more. joseph in wisconsin. joseph? >> caller: jim, national championship night, no cheap scotch tonight. i'm calling about toll brothers, tol. what do you think here? is it a buy here? >> you're right on the no cheap scotch. toll brothers is good. i think it's terrific. i saw it and i think it's buy buy buy. that is the conclusion of the "lightning round." >> the "lightning round" is sponsored by td ameritrade. coming up, new construction?

some new stocks are planning their street debut this week, including one of the first to enter the red hot housing market in a decade. but are these companies built to last? or could these offerings fail to find a foundation?

♪ after another day where we got crushed before we rallied later in the day, an entirely mixed picture, there's one corner of the stock market that is just on fire. that's ipos. we know that 2013 is so far anything better. we saw 31 deals and they've given you an 18% return since coming public. 18% is the average. the gain in the first quarter, including the bad ones, that's just an average. you'd be more selective and you could have done better. i think this is likely to continue. which is why tonight i'm going to tell you a tale of two upcoming ipos. first, what kind of ipo should you stay away from? intel sat.

they provide satellite video and data services around the world. this one came to my attention because of the sheer size. intel sat operates more satellites, and they have more services to more customers in more countries than any other commercial satellite player out there. that intrigued me. the company plans to raise $500 million by offering 21.7 million shares, and at the midpoint that would give intel sat a big market cap. last year the company generated $2.6 billion in sales, so on the surface it seems pretty inexpensive. why am i telling you to stay away? for starters, they lost under $147 million, even though it's hardly a start-up, it's been around since the '60s. what really turns me off is the underlying reason it's not profitable, they have a mountain of debt. nearly $16 billion. they plan to use the proceeds from the ipo, pay down some of that debt. good. we're still talking about a gigantic mountain of debt. in truth, it's risky. 20% of the business comes from government.

take a pass on it. what kind of ipo is just right? let's consider taylor morrison, a home builder that could be the taylor swift of the ipo market when it comes public later this week. you know that housing is on fire. one of my favorite themes. mortgage rates are super low, affordability is terrific. housing related ipos have had a phenomenal track record over the last few months. it popped 12% the first day it traded. boise cascade, maker of housing materials spiked when it ipo'd on february 25th. october, trulia, web based real estate soared 41% the day it became public in september. you get the picture. and the home builders after being hammered, they've been working their way back up today. so the timing for taylor morrison couldn't be better. they build and sell homes in three regions. first the east which is really the south, which is houston and

west florida. and the second is the west. they operate in phoenix, arizona, northern and southern california and third, a small canadian business accounting for 17% of the sales. these are markets that have experienced significant improvement in home of late. last year, taylor morrison closed on 4,014 homes. the company increased orders by 45.8% year over year. they have been profitable three years in a row. they own terrific real estate including some great land bought at the bottom of the cycle. now taylor morrison plans to come public later this week. midpoint of the range, $2.6 billion company. more important, it would be selling at a slight discount to the average home builder there as the group trades at about two times book value. here's the bottom line. the ipo market has been on fire this year. doesn't mean we should throw caution to the wind. stay away from intel stat, but the taylor swift of the ipo market, taylor morrison, this is

exactly the kind of ipo to get a piece of. don't chase it in the after market, but get a good stock deal.

after underperformance, my two favorite speculative ideas for 2013, the airlines and the mortgage insurers, well, they're starting to come roaring back. aided by timely research, these aren't one quarter wonders. they're not flashes in the pan.

you know, i have absolutely hated the airline stock ever since i gaffed my whole goldman sachs account base when i recommended american airlines as the best stock in 1985. i have stayed away from them ever since until this year when the government blessed the u.s. airways merger to bring them out of bankruptcy. today, deutsche bank comes out with research headlined, preview, airline stocks on track. this is astounding. explains why a lot a lot of the crew, they have been so good. why the increase in the index is up 27% this year. that far exceeded the s&p's excellent first quarter. that's incredible. 27% versus 9% or 10%. deutsche bank is predicting 42% upside for delta stock over the next year. 37% increase for united continental. 27% move for u.s. airways. the stocks are finally catching up to the fundamentals as deutsche bank points out this

could be the industry's fourth straight year of profitability and the seventh year out of eight with positive free cash flow. pretty good. the best i believe will be the u.s. airways/amr combo because it will most likely not be challenged by upstarts. that's always been the lot in life, been the case every other time that they have pricing power i can recall. the big roots are being divvied up a couple of large, sensible, rational, big players. i sense that the price wars are a thing of the past. we recently interviewed the ceo of spirit, the only real upstart with traction. he wasn't the least being interested in competing with the big boys and likes to go where they ain't. again, the bustling of the consolidation by the antitrust division makes this price depreciation possible. as far as the mortgage insurers,

good research firm macquarie recommended radion. you know my favorite of the group. it comes out from the rollout. remember, the rolling off of the bad mortgages and increasing the money and good mortgages. something that's happening at lightning speed. there used to be ton of players but the competition has dropped off dramatically, and the government, which had been the biggest player in the industry, via the fha has reined in the business dramatically. only will get more and more -- let's just say less competitive. i believe a lot of people are late to the party, but i believe leaving right now before the explosion of positive earnings is just plain wrong. the sponsorship for the two groups is still minuscule. that's much closer to the beginning of a move than its end. these stocks should be bought here and bought buy buy buy aggressively. stick with cramer.

it had to happen. when you're down 30% on comp store sales you cannot put any more money behind a guy who did that. this is an arrogant man, i want the j.c. penney people and the store to survive. i don't know whether it can. mike ullman at least knows it. maybe he can turn it around. he's a good guy.