catch a big fish on wall street. you have to know where to cast your net. don't drown in debt for another second. i'll be your captain. i've got three stocks that could be the perfect bait > my mission is simple. to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, and i promise to help you find it. "mad money" starts now. hey, i'm cramer, welcome to "mad money," welcome to cramerica. other people want to make friends, i'm just trying to save you a little money here. my job not just to entertain you but to educate you so call me at 1-800-743-cnbc. i'm old. in most cases, that's a bad thing, but occasionally, there are benefits to being old. and today, a day where the dow tumbled 190 points, s&p sank

1.02% and the nasdaq plunged 1.14%, i think being old is a very good thing. what's so great about being old? simple, i remember things. things that can be valuable to all of you, because i've lived and traded through them. right now, of course, we're in the midst of earnings season. the news is coming fast and furious. boeing missed the forecast, is the honeymoon at yahoo finished in the wake of the not so hot quarter and the slowdown? in a normal day, we pick them apart, questioning whether facebook's quarter was as good as it looks. i think it is. these are not normal times. other forces are at work. forces that are not necessarily bigger than individual companies that make up our stock market can still trump them short-term. let's set the tableau you and me. nothing to do with the earnings report, which like every other day have been good with only a few real stinkers. typically on the guidance, too, not the quarters themselves. the weakness is from emerging markets and their likely impact

on our own stock market. this spillover effect, this waterfall, is something i'm uniquely qualified to riff on because i'm old enough to remember investing through several other emerging market panics, just like we're having right now. and i want to give you that historical perspective so you can make up your own minds about whether to cut your losses, start buying some high-quality stocks, one or the other. i know this stuff can drive you to drink, or as joseph conrad wrote in one of my favorite stories, fittingly "youth" pass the bottle. my first tussle with emerging markets was turkey itself. betting that people would stop pulling money out of this country as it needs so-called foreign hot money to pay for its debts. 22 years ago, i was real hot on turkey. the economy had taken off, the secular government seemed to be turning the country into an eastern powerhouse and there were talks, tons of talk about how it was going to be the next germany. i couldn't resist, i had to have

some. and after examining the best prospects, i bought a ton of the bank of america of turkey and the turkish whirlpool. there were two thoughts behind those purchases. one, the emerging middle class in the region was beginning to buy homes to start businesses so the banks would have to boom and it was going to be the low-cost supplier of the emerging middle class of central and eastern europe for washing machines. believe me, the hook is always the emerging middle class. so irresistible. give me some rakia, the national liquor of turkey! then like now, though, turkey had far more political risks than i realized. it needed capital for its growth and that meant higher interest rates. sure enough, the country started faltering and printing money. first the stocks didn't seem to be going down, but that's only because they were priced in turkish lira and didn't reflect the decline in the currency. when i started translating the currencies, in just a month my investments were cut in half. next thing i know, i got about a

quarter of my money back. it was a total disaster, people. emerging markets, so great. however, if i kept my cash close to home, i would have made a fortune. turkey had no impact on our markets. in part because we weren't nearly as linked as we are today and the media didn't cover the place back then. these days, we have lots of cash that's interconnected, flying all over the place, borrowing money to pay turkey, many others worried about contagion to other countries. some stress here, argentina, south africa, indonesia. some are even blaming the fed for causing the spiral, but that's because they're fed centric and would blame the fed if the favored broncos lose in the super bowl on sunday. my next big emerging crisis, well, how about mexico? in 1994, the emerging market of mexico was all the rage. i remember morgan stanley trying to talk me into buying mexican stocks, but i learned to stick to my knitting after turkey. others didn't, and we had the peso crisis also known as the tequila crisis. i'm not kidding. and by the way, that's not the

same as when we ran out of high-quality tequila. that won't happen again. pass the bottle. you should have seen the panic during the tequila crisis, you would thought every speculator had swallowed the worm that they put at the bottom of the bottle and real bad mezcal. before that happened, our stock market got pounded, 470 down to 445. a year later, s&p trading at 627, hmm, scaredy cats freaked out. those with patience and fortitude caught a 40% gain over the next year. fast forward to 1997, the emerging market pied pipers, hong kong, singapore, south korea, taiwan, hey, the four tigers of east asia. thailand, a tiger cub was trying to get in on the action, but it got too overheated. and its currency, the thai bhat got clobbered.

the contagion quickly spread to four tigers which were reduced to a bunch of tabbies. guess what, you can't see the decline. going into the asian financial crisis, the s&p 500 stood at 865, a year later emerged at 1,098, 27% gain. i'll take that any day of the week. but a lot of people didn't take it because they panicked about a currency that they'd never heard of. and now, when you see this, it's pretty darn funny, isn't it? final tribute to emerging market lunacy, the russian ruble collapse of 1998 where the stocks and bonds of that newly capitalist nation had way too much vodka to drink! and the rotgut annihilated their markets. once again, i'd been urged to get involved shortly before it went bust. others who hadn't lived through my turkey experience followed that advice and their panic brought the s&p down from 1,174 to 1,096, a 6.6% decline.

but a year later the s&p stood at 1,348, 20% gain for those who didn't vomit up their stocks after a stoli bender. pass the bottle. which brings me to the point of these old war stories. here we are again gripped by one of these panics. many seem to believe this has to be europe all over again where we took a serious shellacking. one that was deeply and inextricably linked to many of our countries. what's happening now is nothing like that. others are thinking what happens if china crashes is into a retaining wall. that could bruise us badly. i'm urging patience here in what could be a 5%, 6% decline a la what we talked about last night on or off the charts. if you only think 365 minutes out, maybe you want to dump some bad stocks. if you're thinking 365 hours out, you might want to trim some good ones. but those who think 365 days out, get your shopping list ready. in a few days, you might need it.

mike in california, please, mike? >> caller: jim, boo-yah, this is medical mike from california, and i was wondering about lexmarx. i bought it a couple days ago on a dip. i'm wondering if you think i should take some profits or if it'll keep going up. >> i'm not a fan of lexmark. it's a commodity company. i do like hewlett-packard more. vinnie in texas, vinnie? >> caller: boo-yah, jim. my question is on home depot. i understood that home depot acquired blind.com, the stock has been going down for the past month. short-terms and long-terms of home depot? >> people are concerned about home depot because they're concerned about retail. they're concerned about retail because they think the consumer's pinched. i'm not as nervous about retail when it comes to home depot because it's an excellent operator, particularly with all of these storms around the country. i believe in frank blake, does

that mean home depot can go to 73? oh, sure, does it mean i'd buy it at 73? you bet. today might have you reaching for a cold one, but please, patience. nurse those drinks, pass the bottle. "mad money" will be right back. coming up -- sweet spot? whether it's the ground floor, the freeway or 30,000 feet in the sky, honeywell has the technology that powers it all. the company just delivered a solid quarter, but can the stock stay sweet amid a potentially sour global economy? cramer talks with the ceo. and later, cleared for takeoff? american airlines emerged from bankruptcy to become the world's largest air carrier, and in today's turbulent market, strong earnings kept the stock above the clouds. can it give you a smooth ride? or will it need to refuel after its 30% rise? don't miss cramer's exclusive with the ceo. plus, executive order. the president talked up natural

gas on last night's state of the union. >> it's the bridge fuel that can power our economy with less of the carbon pollution that causes climate change. >> but is it just hot air or is there a way to play it? all coming up on "mad money." don't miss a second of "mad money," follow @jimcramer on twitter. have a question? tweet cramer #madtweets. send jim an e-mail to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. miss something? head to madmoney.cnbc.com.

even a difficult moment like this one where everyone seems terrified about the global economy, please, let's not get too despondent, because there are still high-quality companies out there that are executing fabulously and the stocks of those companies are holding up better than the rest of the market, as they should. consider cramer fave honeywell, makes everything from aerospace components to energy saving climate control systems, security equipment, turbo chargers that can dramatically

increase your car's gas mileage. last friday, reported the results were darn good. ended up getting lost in the shuffle of the market's hideous selloff. company delivered strong headline numbers, 2-cent earnings beat with higher than expected revenues. but the really impressive number was honeywell's organic revenue growth, up 5%, that's much higher than management anticipated. on top of that, the transportation business where they sell those turbochargers for cars and trucks was incredibly robust. management said that china did extremely well during the quarter. these are both good news stories at a moment when people were worried about autos and terrified about china. dave kote is one of my bankable 21, but look, it's up less than a point since reported on friday. i think it deserves to go higher, especially with the analyst day coming up in march. don't take it from me. let's check in with honeywell's chairman and ceo and hear what it means for his company and the global economy. welcome back to "mad money." >> nice to see you again. >> have a seat. have a seat. i'm going to get to the economy for a second, but boeing was

down horribly today and it just seems like a weird juxtaposition. aerospace was so strong for your company. i have to believe that to some degree whatever got into boeing's stock today is not necessarily reflective of the longer term view that you have about the aerospace industry. >> well, i would say, yeah, the aerospace industry is one that i'm very bullish on generally. as you know, i've tried to position ourselves within macro trends, stuff i look at and go, okay, over decades, this is likely to keep moving in this direction. and i just don't see a future where planes aren't a bigger and bigger piece of the overall pie as the world becomes more wealthy, especially on gdp per capita, families become more dispersed, businesses more global, people are going to travel. and cars aren't going to get you all those places. >> and you cover the panoply. not everybody's doing well, but it's a rising tide for everybody. >> yeah. >> to me, a lot of times i feel you're concerned it's tepid. i think that you -- reading through the lines -- you think

it's slightly better than it's been. >> i would say you used the right words there. slightly better. and as you know, i've been one of the guys who has been a little nervous, a little skittish about it for the last three years, and i've played it that way. and i can say even at our senior leadership meeting this year, which i did two weeks ago, my message was this is the fourth year where our theme is winning in a slow-growth global economy. that part's still true. >> right. >> however, i do feel like it's slightly better than it was. i don't know that i buy into the 3% growth scenario for the u.s., but i do believe it will be slightly better than we have been. which is good, as long as it's getting accelerating, that's where we want -- >> and you -- i know you're close enough to china to know a slight down tick could matter. argentina, indonesia. your world view fits that all in, right? >> i was always nervous about argentina. how could you not be? turkey can be a little disturbing. i hope that they sort that out. but it's not like it drives the

world. >> right. >> china is one to pay a lot of attention to because it's got 1.4 billion people, second biggest economy in the world. and interestingly for us became the second biggest country in the world for our sales last year. >> wow. >> and i think that's an important dynamic and one of the reasons why i talk about why it's so important to become the chinese competitor. it's going to be increasingly important. >> right. >> i don't think we can always rely on the economic statistics that come out of china to quite the extent that people want to. if it's really good, they say you can't believe that. if it's really bad they go, oh, my god. >> you're right. it's not like a labor report that comes out on the first friday. >> yeah. exactly. >> so we've been pretty bullish on it. our sales were up double digit in china last year. >> fantastic. one of the moments in the conference call that was you just saying -- telling it like it is. if you want to meet cafe standards, if you want to raise how much gasoline, you know, cut

the use of gasoline. >> yep. >> you need your product. >> yes. you need turbo chargers. >> why does no one else have it, and what does it really do? >> the significance of a turbo charger, think of it this way, you can have a v6 engine that performs like a v8 engine, but with about a quarter to a third less fuel usage. >> don't you think most people say i don't believe that, it's not possible? >> well, we've been doing it now for 20 years. actually, longer than that. this is a deal that was actually struck by one of our founder companies, garrett turbo chargers. >> oh, sure. >> working -- it was actually the garrett engine business, working with caterpillar. and the thought was, is there some way to adapt jet engine technology for use on an engine. at the time they were thinking to make it more powerful. you didn't need as much fuel, either. it's one of the reasons that we have an advantage in turbochargers that will last forever. if you look at a turbo, it

really is just a small jet engine, material science, air flow handling, same for that as it is for a jet engine. guess who the only turbo charger manufacturer is who has a jet engine business. >> just you. >> we have a technology advantage that nobody else is going to match. and that's a technology that is just so easy to put into a car, because i've often said people want to save energy, but they don't want to do it if it means being warmer in the summer, colder in the winter, or a car that costs more and doesn't go as well as the last one. you need to always be thinking about how do you manage comfort with savings? how do you manage performance in a car with savings? and a turbo charger allows you to do that. >> speaking about technology and cold weather climate, two thirds of it worse since 1977. i'm thinking thermostat. i want to know whether you think given the technology of your thermostats whether you had a laugh, a chuckle when google bought nest, when it seems like your -- you can speak right to your climate control.

>> my comment was at that multiple, they can have honeywell. i'll sell them the whole thing. they can have everything. >> they had to. i mean the people at apple were like, oh, holy cow, they could pay anything, and people love google. it was kind of like that, wasn't it? yours do a lot of good stuff. >> i was incredulous. even something like a wi-fi thermostat, we've had that for three years where you could do it on your smartphone. >> i love it. i've got it like that. >> it works fine and we've got the voice-controlled thermostat now, which is really pretty neat. and there's been significant patent violations, as you know, which we're continuing to pursue. >> right. right. >> like i said, my thought was, hey, you can have the whole thing. >> exactly right. >> you paid that multiple. we don't even need to negotiate. you can have the whole thing. >> i like that. they've got the cash. now, you've always been a big thinker, too, about the united states and about the government. it looks like when i look at some of the numbers that we are

getting a little better on the deficit, a little bit of religion. still some very big issues. heartened, disheartened, where are you? >> i'm kind of in the middle with it. >> all right. >> because we're semi-declaring victory, because we only have about a 70% debt to gdp ratio, which, by the way, is the highest in the history of the country over 240 years, close. other than world war ii. so as much as everybody complained about the ronald reagan debt and deficits, or complained about any one of the wars, this is the worst it has ever been. and while this decade will probably hover around there, it starts to climb up towards 90% in the second decade because we are not doing the stuff we should. and i try to put this into the context of how do we compete as a country on a global scale? the world has changed for us.

we've gone from 1 billion people participating in the global economy to 4 billion. now you have china, india, russia, all of them. and you can't compete with a bad balance sheet. >> right. >> you can't. and that's what we have. >> that's the bottom line. >> yeah. that's what we have. >> all right. dave, you've always been sober but i also like yours slightly better. chairman and ceo of honeywell. you see why i think this stock is so terrific. stay with cramer. coming up, cloud nine? with more than 3,000 flights a day, chances are you've booked a ticket on american airlines. but is the stock a better way to fly? stay tuned.

one more hideous day, what managed to buck the market's gravitational pull and rally quite nicely? how about the brand new american airlines, aal, the uber cramer fave product of the merger between u.s. airways and amr. moved up another $1.02 today, that's 3.19% after reporting a top-notch quarter yesterday morning. let me give you background. for decades, my view on the airlines was very simple, you never ever buy them because the ruinous competition in the industry was constantly pushing ticket prices lower, often sending great airline companies into bankruptcy. then, over the last several years we've seen a way of consolidation culminating in

this deal that almost got blocked by the regulators for antitrust issues. and thanks to this merger and others, the airline business has become an actual investable business. four carriers handle 80% of air travel. and as i tell you in get rich carefully, consolidating industries represent a fantastic long-term theme. and in my opinion the best one to own is the new american airlines. i recommended almost a year ago and since then, it's given you 135% gain. but the actual deal's only just closed, i see a lot more upside, especially since american reported yesterday and delivered spectacular numbers. let's take a closer look with doug parker to learn more about this brand-new company and where it's headed after the merger's complete. mr. parker, welcome to "mad money." >> hey, jim. how are you. >> great to have you on the show. i don't want to slight the other airlines, i like them more than every other company anyway. >> good. >> you heard my intro. i remember the first stock i bought was american air, it went from 80 to 35 in a heartbeat. you say right now in your conference call it's night and

day different. >> it is night and day different. you know, look, i've heard a lot of stories like that over time. our business for the longest time wasn't a very good business. indeed, hadn't produced returns on capital for anyone since deregulation, and probably before that. but it is different now. we've got the -- the industry has through a number of mergers has gotten to a scale that makes sense where we can provide to customers the -- what they want, which is take them where they want to go and do it efficiently. and the result is now we have a business that works, and it can work for investors and for customers. >> but every time that's ever happened before, somebody has broken ranks. your company would order, say, if it works for 100 planes, you'd order another 50 planes and everyone else would do the same thing and that'd be the end. >> fair enough. the reality is, before we were all trying, as airlines, trying to get to enough scale to do

what customers want. all the places they want to fly. and in a fragmented business, what that meant is every time you had a whiff of profitability, someone would decide i'm making a little bit of money, if i had 150, i'd make a little bit more, doesn't work that way. and everybody would get more airplanes and we'd be back in the soup. with the merger and the prior mergers at delta and northwest, delta and united, of course, we now have an industry where we have at least three large airlines that can do that. very competitive but can take people everywhere they want to fly for the most part as well as some strong competitors like southwest and jetblue and others that fly point to point. >> the ceo of boeing, stock was down today, what an opportunity to buy. and what he said when he was on our show was if someone wanted to get a new plane, it would be difficult. if i wanted to do an upstart, i can't go get 25 planes that are fuel-efficient, can i? >> no, not new ones. we all have orders in place. a lot of that for replacement. the reason jim's doing so well is they're building some really efficient airplanes. and, you know, we at american

are retiring a number of of older super 80s that are less fuel-efficient and bringing in and using some of our capital, anyway, to make some really positive investments and bringing in new airplanes that are more fuel-efficient, better for customers and p & l. >> when i go on a plane, it's packed, they're not making any money. now when i see a packed plane, i have to presume that's a profitable plane. >> i hope so. that's a fair presumption. again, in the past, we can always fill airplanes. that's never been a problem. it's a perishable product, we all know how to fill the last seat, you do it by lowering the fare low enough. you should never look at load factors to try to make any assumptions as to how an airline's doing. we can always fill the seat. what really matters, can you fill the seat at a level that covers the cost? and that's what we've done poorly in the past and we're doing much, much better. i think it's going to get better as we go forward. >> every time i've ever looked at an airline's balance sheet, it has always been terrible. yours has a lot of excess capital. you're going to have to do something with it. >> yeah. at some point we will.

that's a high-class problem, of course. >> it is a high-class problem i've never seen an airline have. >> given the history you're talking about, this is new for us, as well. no, we have over $10 billion in cash. and that's, you know, and it doesn't earn a nice return for our shareholders. we know that. but, you know, we just put the two companies together. they each had ample amounts of cash on hand. now we have a really ample amount. and look, so we're going to look forward, look ahead and see what we should do. we'd like to get a few months of actuals under our belt and see how things come in, but we feel really good about the future. and we'll be paying down some debt and be looking to return that to our shareholders. >> i look at the market today and last week and i think people are saying the world is slowing down. are you seeing cancellations? are you seeing slowdown among your travelers? >> goodness, no. bookings are strong, we're seeing -- and everything we see just looks very strong. >> and all the other years that i've been following the industry, i see some bad weather, go to the weather

channel means short the airlines they're going to start losing money. not happening in this bad weather now? >> weather hurts, of course. but we've gotten much better, certainly as an airline. at u.s. airways, gotten much better at handling these disruptions. don't try to fly through them. we follow the weather, know what's going to happen. and make sure we don't fly airplanes into that, wait for the weather to subside and then we have the people in the right place, our pilots in the right place. get started the next day fresh. that works better for our customers because we don't end up having them trapped in places that we can't get airplanes out of it and works much better for the airlines in terms of being able to handle this in a way that doesn't hurt your profitability. >> how about labor? historically another thing gone wrong with the airlines, there are strikes, so many different unions, they feel ripped off, picked on. >> well, one of the best thing about this merger is the great support we've had from the employees on both sides. both airlines have gone through a lot, bankruptcies in both cases. >> right. >> which has been really hard on employees. by putting these two companies

together, we created one that's so much stronger, that gives them one that they can build a future and one where they can have a career if they want to. and that -- i think the labor unions now appreciate is what their constituents really want, a strong company allows for our employees to build the careers they want to build. and, anyway, not to say there won't be some issues in the future, because there always could be, but it doesn't feel anything like it did in the '80s and '90s where we had those types. >> last question, in the conference call an analyst asked that, look, you're only going to grow 3.5%, why bother to put these two together? where's the synergy? where do you really make more money? i read the question. i thought it was funny, too. but i figure, you know what -- >> no, it's a fine question. the fact of the matter, we put the two networks together and we can provide -- we can get customers now that neither of us can get independent -- american airlines didn't have a network that went down the east coast. put those two networks together, and even though there's no

capacity coming out, we don't want to take capacity out, because the two networks together are so much stronger than either independently. and that allows us to serve customers and provide a return for our shareholders that neither of us could independently. >> thank you so much. that's doug parker, the ceo of american airlines group, this is a different company and a different industry. i say forget the past, think about the future. stay with cramer.

listen up. before we get to the "lightning round," a little reminder for you, cramerica, to join me for a book signing one week from today. come see me at the barnes & noble in new york city on february 4th, next tuesday at 7:30 p.m. come there early because i've got to tell you we ran out of books at the last signing we had there. i would love to see you there. now, it is time, it is time for the "lightning round" on

cramer's "mad money." you say the name of the stock, i tell you whether to buy or sell, you play until this sound and then the "lightning round" is over. are you ready skedaddy, time for the "lightning round" on cramer's "mad money." louise in north carolina. louise? >> caller: boo-yah to the chief of cramerica. how are you doing tonight? >> caller: doing great. i want you to tell me two years from now, how would you like post benmosche aig? >> well, since he's one of my bankable 21 in "get rich carefully," i don't want him to leave. one of the reasons i do like the stock of aig. may i go to mike mike mike in new jersey? mike? >> caller: facebook boo-yah, jim. >> facebook is darn good and that's one of those social mobile cloud stocks i've been recommending endlessly. how can i help?

>> caller: been following since you had the ceo on, what are your thoughts on a buyout? >> i don't think there's going to be a buyout there. but i like that thing. i've always played that issue with allergan. and that's been steadier than zeltiq. scott in new jersey, please, scott? >> caller: boo-yah, jim. >> boo-yah, scott. >> caller: my stock is a recent ipo, jones energy. >> yeah, my problem with jones energy, i've got a lot of seasoned companies that are real down on their luck lately like a continental, pioneer, eog, and i think they're cheaper. let's go to sal in new york, sal? >> caller: boo-yah, jim cramer. this is sal. >> hey. >> caller: "get rich carefully." we love you, we love your book, my stock is medallion financial. >> really good yield. it's a small cap, new york city kind of issue, and i don't know enough about the finances in the city going forward to want to recommend that stock. paul in texas, please, paul? >> caller: boo-yah, cramer.

>> boo-yah, paul. >> caller: so this company had an earnings report this morning, beat on top and bottom line and still down 3% today, what can you tell me about jetblue? >> yeah, i know they were on an earlier show. here's what i tell you about jetblue, no, no, no, no. the one to buy is american air, aal, doug parker. let's stick with the highest quality. steven in new york, steven? >> caller: hey, hello professor cramer! thanks for making my life a little happier place to be. >> i like that. i like that analysis. thank you. >> caller: here's what i have. i have a position in henry shine, hsic, for well over a year and enjoyed a 60% plus gain. what do you think the future will be? hold it, buy more, or realize my gain? >> play with the house's money, but i said you know what, i am all in, henry schein, that stock is a stock for the ages.

dorothy in florida, dorothy? >> caller: hi, jim, greetings from boca raton. thank you for taking my call and for keeping us grounded with your knowledge and experience during these rocky times. >> thanks. >> caller: my stock is conagra. >> it's got a 3% yield, it is not my favorite food stock. i would prefer you to be in bgs, b & g foods, i think it has more upside. and i'd like the fact that when david wenner comes on, i feel so good about the quarter and the dividend, which is a little bit higher in terms of yield, than con agra. and that, ladies and gentlemen, is the conclusion of the "lightning round." >> the "lightning round" is sponsored by td ameritrade. >> coming up -- executive order. the president talked up natural gas in last night's state of the union. >> it's the bridge fuel that can power our economy with less of the carbon pollution that causes climate change. climate change.

>> but is it just hot air, or is there a way to play it?

at moments like this when everyone's panicking about some overseas crisis, i always tell you to fall back on some

favorite long-term themes, themes that will still be there regardless of what happens in turkey, argentina or china. one of the huge themes i highlight in "get rich carefully" is the oil and gas resolution. crude and natural gas that were previously thought to be uneconomical. this is not only caused an incredible surge in domestic production, something the president highlighted, but also seeing companies deploy these new technologies for recovering oil and gas overseas. who is the big winner from all of this? i'll tell you who it is, core labs, c.l.b. the best technology in the business here and abroad, 60% of the sales are international. they analyze the rock and fluids in oil reservoirs so their clients can produce more oil per day while also helping them get more crude out of the ground. core tells the oil and gas companies how and where to drill to get the most value. their other big division does the analysis oil companies need to drill a well to perfection. and that includes designing the process of hydraulic fracturing

or fracking, the technique that's opening up the domestic shale plays i'm always talking about. reported after the close today and the numbers were excellent. company delivered a 2-cent earnings beat, more importantly, gave positive guidance for the next quarter and 2014. core has tended to trade down after reports regardless of whether the quarter is any good. if it gets hit tomorrow, that's your chance because the stock has always been higher, every time i've had the ceo on since last time. this stock has given you a 220% return since february of 2010. core boosted the dividend two weeks ago, very positive sign. let's take a closer look with dave demshur, the chairman, president and ceo of core labs, hear more about the quarter and his company's prospects. welcome back to "mad money." >> thanks, jim, thanks for having us back on "mad money." our 11th appearance on cnbc. >> i know what i like about it. every time you've been on, the stock has been higher than the previous time. you must be doing something

right. >> we've been truly blessed and our guys put up a great quarter this time. really propelled by new technology and driven by a lot of activities in the shale plays, these tight oil plays here in the u.s., and also in the golden triangle, which is the deep water areas offshore brazil, west africa and the gulf of mexico. the combination of those produced our fifth record quarter in a row, record levels of eps, net income and revenue. >> okay. so if i'm watching someone talk about the upcoming earnings from the oil companies, and the rap was this, oil not stabilized they won't drill as much. and two, the rig count not going up so there's not as much drilling. and made people feel after i listened to that that the oil service business must be doing badly, those don't correlate, though, do they? >> if we think about, look at some of these shale plays, jim, we are drilling longer horizontal wells, so even though it's the same drilling rig, you're drilling more footage and we're putting more of these hydraulic fractures into those rocks. even though that one drilling

rig is static, the length of the well that it's drilling and the number of stages it's put in could be 5%, 10%, 15% greater. and core lab has really benefitted from that because every frac stage is a revenue opportunity for us. so we benefitted from additional drilling, longer laterals and more stages in those laterals. >> excellent. now, you've got a great release where you break down everything, and you've covered america, but i want to talk about the reservoir description. you rip right through. you say gulf of mexico, but then you're talking about middle east, kurdistan. is this because when you're brought in, maybe some people felt there wasn't oil there before but you find it? >> well, the fact is, jim, they know it's there, they just have a difficult time maximizing the recovery. so they hire core laboratories, we do core analysis to look at

the rocks, we look at the reservoir fluid analysis, which is the analysis of the natural gas, crude oil and water. we combine those data sets so they can maximize their daily production, but more importantly, maximize the recovery from those reservoirs. if we look at kurdistan, for example, there have been multibillion barrel discoveries there, but the recovery rates are in the 10% to 15% range. for those to be economical, we need to get that recovery range up in the 20% to 25%. worldwide that averages about 40%. so combining those data sets generated by core allows them to maximize daily production. but more importantly, to maximize the recovery from those fields over the life of those fields. >> does anyone have that technology besides you? >> well, the major oil companies do. we tend to see ourselves as symbiotic on a technological basis with the major oil companies. so when their own internal staffs are full up, they outsource that work to us. so we're always trying to

innovate new technologies with them so we grow our technologies right along with the exxons and the shells and the bps and the chevrons of the world. >> you know, dave, i have been a believer that we have more oil. i've been right, but lately people have been doubting me, saying, jim, the stocks aren't doing well. reservoir management continues to have a high level of activity in the permian basin projects, focused on the delaware basin in midland. people say those are played out. they're old. why would you be doing this reservoir management if i'm too excited about nothing? >> right. not correct. we are high on the permian basin assets. you have a number of plays where we think there are additional billions of barrels of oil to be recovered from the permian basin. right now, if we look at the activity levels around the u.s., the permian basin, the bakken, eagle ford, we see billions and billions of more barrels of oil to be recovered from these plays over the next several years.

and these will be decadal plays. if you look at the united states, we're pushing almost 9 million barrels of oil production per day and when we add in natural gas liquids, that's over 11 million a day. that's more than saudi arabia's making. right now we're on a very good trend. technology is in a renaissance period where it's going to add to recovery rates and production rates for decades to come. >> i have to say, when i listen to you, the people who are doubting me are doubting the science and the technology and the empirical vision your company has. not just -- you can't really fight the facts, is what i'm saying. >> well, if you look at just from a scientific basis, we know that we are recovering more and more oil from these shale reservoirs. back a number of years ago, the average recovery factor was maybe 5% to 7%. now we've pushed that up to 9% to 12%. ultimately we think we can get it up in the mid to high teens, which for tight oil shale

reservoirs will be very, very good, very, very encouraging for the energy-producing trends in this country, not only in this country, worldwide when we start looking at shales in russia, north africa, china, and australia, because they're right around the corner. >> well, dave, i want to thank you again for delivering for shareholders, all viewers, viewers have all made money if they've watched you because the stock's been up every time. thank you, david demshur of core labs. if you believe in the technology of oil, what you're really believing in is core labs. stay with cramer. let's say you pay your guy around 2 percent

to manage your money. that's not much, you think except it's 2 percent every year. go to e*trade and find out how much our advice and guidance costs. spoiler alert. it's low. it's guidance on your terms not ours. e*trade.

i know it's hard to imagine, but there was a time when we used to hang on every word of the state of the union address because you could figure out where the money was going, where the federal government was about to spend your dollars. this speech used to be a totally investable event. i remember listening to ronald reagan when he was talking about building up the navy to 600 ships. reagan had the ability to get it done and there were enough naval contracting stocks back then you could invest and catch multi-year moves. under president clinton, there were technology initiatives, credits that would turn into earnings. it worked. i can't recall spending much time sussing out president bush's speeches because they were muddled and hamstrung by 9/11.. but even when obama first came to office, there were investments like the medical records companies, the apparent beneficiaries of universal health care. it's been incredible for the health care cost containment

stocks, cardinal health. i don't know if president obama realizes it but those four companies have been consistent winners during his time in office. and that's largely because of the need to rein in rising health care costs that the government has done little to help stop. these days, though, i find the state of the union a painful speech. i think the president means well, but don't they all? it would be terrific if we could cherry pick the good parts of globalization, block the bad, forcing other countries to take more of our goods while not taking our jobs and polluting less with the jobs they do take. they import our jobs and they export their goods and climate destruction. not all that investment when you think about it. the myra, count me in. who wouldn't want a risk-free bond with high returns? the natural gas nod? >> i'll cut red tape to help states get those factories built and put folks to work, and this congress can help by putting people to work building fueling stations that shift more cars and trucks from foreign oil to american natural gas. >> i see people getting excited that obama's finally embracing

natural gas as a bridge fuel. but then again, i did an analysis of the 2012 state of the union address, and he did the exact same thing and nothing happened, nothing at all from the federal government's perspective. the thing is, there isn't any real red tape that needs to be cut to build those factories that use natural gas, and congress has systematically refused to help put people to work building fuel stations that shift more cars and trucks from foreign oil to american natural gas. the excitement over his apparent embrace of natural gas spiked clean energy fuels, the biggest nat gas fueling station builder, from $12 to $24. but the stock was back to $12 four months later when nothing at all was done to move the ball. same with westport innovations, which went from $27 to $48 in the aftermath of the state of the union speech, and then fell back to $22 in the exact same arc. we won't be fooled again. we just have to face it, the president can't get anything through a divided congress. it was a very nice speech that would make america stronger if

some of the initiatives could actually happen. but i sure wouldn't invest that way. you shouldn't either. stick with cramer.

as i was saying in "get rich carefully," there are not many

themes as strong and as powerful as social, mobile and cloud, which is one of the reasons why facebook is soaring. they've got all three. and don't forget, google cutting its losses, another good thing. i like to say there's always a bull market somewhere, i promis tomorrow. in this episode of "secret lives of the super rich" -- >> i want to show you one of the most exclusive properties in the hollywood hills. >> it is total party central. >> we put this on the market at $20 million. >> they're going to tear it down. >> alongside the gold coast of long island. >> xavier's helicopter company is basically a super rich taxi service. >> there's your house, chris. >> this room is insured for $2.5 million. >> meet eric and lana and welcome to their mega renovation project. you guys actually cook in here? >> every sunday, 16 people. >> this is firste