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tv   Mad Money  CNBC  October 8, 2014 6:00pm-7:01pm EDT

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i think it's too much. >> you do? >> i think it's too much. gps. >> that's a great call. that's what i'm talking about. >> all right. i'm melissa lee. thank you for watching tonight. 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. i'm cramer. welcome to "mad money." other people want to make friends. i'm just trying to save you some money. my job not just to entertain but to educate. call me, tweet me. relief rally or real deal? that is what you have to ask about. any rally that starts because the federal reserve released minute that showed the fed isn't likely to raise rates soon
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because of worries of a global slow down. it did trigger the powerful move up today. dow soared 275 points. s&p shot up 1.75%. nasdaq rocketed 1.9% because it contradicts the prevailing wisdom that the fed is on auto pilot to take rates higher no matter what. the rally was all encompassing. here is the problem of putting too much stock in one day's rally so to speak. if you are bullish it is terrific to note the fed isn't going to do something stupid. hedgefund managers come on tv or call for much higher rates to teach a lesson. it is fantastic that our central bankers don't have the same desires of much more strident hedgefund managers who want to trigger a nasty recession who create a havoc in order to make a lot of money. however, the problems that many of our companies are facing are simply beyond the purview of the
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fed which makes you upon further review by the overseas markets skeptical of staying power. we are not in charge. to put it in stock terms we need more alcoas and fewer ford motors. . so what is vulnerable and what isn't? i remain concerned that the commodity complex on the ropes. we saw a huge turn today when the fed made the move. oil and gas stocks went up. i think that was caused by the powerful pull of hedge fund managers who suddenly they had to sell or get overrun by the largest day of the year. the collapse in the natural price of oil continues. . and i think these stocks are really being given a nice reprieve. the earnings estimates are too high and will be slashed.
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i believe the transports that reversed and went higher today could resume down turns because many are involved in travel and leisure. just like the fed can't control the price of oil it can't control the principle reason why the stocks are going down namely fear of rapidly spreading ebola virus. until the virus is perceived to be in check i think we see declines in travel-related activities. the stocks will likely resume their decline after we assess the impact of the dallas man who died of ebola. i think that would have been a major focus of the market. third, it is hard to trust the banks when the fed says it is not about to turn on the dime and raise rates. banks rose today falsely. i don't think i heard anything different that will help them. it is kind of startling. when rates go as low as they have and they are low right now there is a pickup in residential lending that helps everything that goes into the homes.
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i have seen these kinds of new very interesting financial products that are being offered for home buyers and refinancers. they aren't as attractive as in the early spring of 2013. i have been shown a bunch are still attractive. they are being given to people with fico scores north of 700 or can prove they don't need a money. i 34 getting pushed the deals because i have money to buy property. i have guys knocking down my door to lend me money because i don't need a dime of it. if i needed it they wouldn't give me a dime. why should they? if the loan goes bad the borrower has the upperhand. the bank has to worry. if the banks have to loan to fannie mae that means nothing. they might have to cough up the loss anyway, pull back, claw back. nobody who needs a loan can get
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one. i don't know about retail. we have a terrific number out of costco. yesterday container store collapsed. tonight gap real dad. my thinking here i think we are witnessing the sears which seems like it could be on the last legs and the winners looks like anyone who looks like sears. retail seems zero sum to me. sears has $34 billion in sales. you think lower gasoline prices would mean more to the group. finally, we have the international companies based here. this cohort has been hammered until today. i think that is because of the new ford motor syndrome. back to the beginning of the year ford looked like the stock you most wanted to be in for 2014. a gigantic turn in europe because of lower rates there. a strong surge in latin america, come from behind victory and
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improving victory. plus we had a strong euro and not that strong a dollar. so currency can be a tail wind. now, every single fact has changed. europe is in a trade war between russia on one side. europe is going back in recession. latin america has become unstable. the sales are hideous. china because of a weakness in europe and decision to crack down on consumerism, not great if you are selling expense chb. all this makes people feel that even ford's 3.5% yield can't protect you from a big capital loss. the only bond market equivalence working are those with dividends have little chance of being adjusted down. utilities even though they don't have much growth. a market that thirsts for growth suddenly craves safety. who needs to be a hero? who needs to find the next bill
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oil stock? gives you a safe dividend. the rally shows when we get oversold buyers come back. they buy growth tech and drugs. bet that rates have gone higher and commodity prices going higher throw in the towel because they are wrong and cover the humongous s&p 500 shorts. that is what happened today. that is the reason for the rally. cap capitulation by bears. betting there would be more like the ford motor guy. the bulls have to hope the rally came because we discounted the negatives are big declines that led up to yesterday's crushing. the bears need more fords. somehow i think they will get more of them than we expect after a strong day like today. jay in maryland. >> caller: thanks for all of us home gamers.
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they have been down the last month but good news today. the earnings report is coming out october 22. should i buy more, sell or hold? >> i would do it in options. skechers had services that said a couple of weak days. retailers say business is good for skechers. the stock is up a lot. do it in calls. the company has told us how good business is. it would surprise me if it were bad. some of the breath taking moves make me want to cut off my down side. that is why i'm saying options for skechers, options for deckers. larry in massachusetts. larry? >> jim, i felt your pain on the 76ers loss to the celtics. how about that evan turner? >> i'm going to wait until next year mode for the sixers. go ahead. >> caller: the spirit airlines operating extended hideous drop.
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aside from $2.1 million fuel charge with capacity increasing 30% next year because of the delivery schedule do you worry about available seat outpacing revenue passenger miles? is it time to load up the cargo hold? >> i got to tell you, again, this is a very tricky topic. i think when you are flying and talking to people who are traveling they talk about ebola. that is probably unrealistic. it is probably wrong. it is probably way overblown. it is what people talk about. when people are talking about that i feel like it is saars. travel takes a hit. i am pulling back on that group. is today's rally a one day wonder? i think the market goes back to worry about earnings. we may hear some companies we think are doing well aren't doing so hot. it would be easier if the stock
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market would stay down. will it last in face of the recent pullback. technicals may be signaling what is next. forget muscle milk. i have the supplement to fill up your portfolio. stick with cramer. don't miss a second of "mad money." follow @jimcramer on twitter. send an e-mail to madmoney@cnbc.com or give us a call at 1-800-743-cnbc. miss something? head to madmoney.cnbc.com.
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after the vicious beat down the averages got hit with yesterday i think it is worth finding out let's say kind of get our bearings here. why don't we go off the charts with ed paunsy as well as being my colleague at realmoney.com.
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at least from the perspective of the charts i got to tell you something, the news isn't as good as what we saw today. despite the magnificent move nothing has changed. things look difficult and predictions from mr. t more pain ahead. felt so good i was hoping he wouldn't reach this conclusion. these are chartists. they are not just trying to feel the emotion of it. what has him worried? after the selloff the s&p fell off the 100-day moving average. why does it matter? over the past 15 months the 100-day moving average acted as a powerful floor of support from the s&p 500. i said we have this and this. this has been the level whereby rrers consistently stepped in and in today's huge rally it managed barely to push above the key moving average right before the close which makes the worry
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that the average could start acting as resistance on the index. we went back to ed after the run today and said specifically if this last gas move changes everything. you want to believe that move changed things. he gave me an emphatic no. i want you to check out the russell 2000. this is the epicenter of the damage in the market. lots of traders got concern when the russell 2000 formed the death cross where the short term 50-day moving average crosses below the 200 day moving average. we talked to bob lang about the death cross and historical record is clear at least when it comes to russell 2000. you get the pullback. long term as we saw last week the so-called death cross has been pretty bullish.
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however ponsy points out what happened yesterday was worse than the death cross because it closed below 1,082 where buyers stepped up in the past. concerned that it started falling through the floor. again, i pressed him. come on, man. didn't it change things? no. either one of these events, the s&p 500 breaking down or russell 2000 pullback would be a concern on its own. the fact that they occurred simultaneously he sees as a warning. to him the charts say buyers are failing to step up. it is not just the averages. ponsy doesn't like that many formerly strong stocks seem to be coming down. one of the great leaders has been amazon.
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amazon spent basically the entire year forming a symmetrical triangle pattern. in other words, it has been making a series of lower highs. this stock which was one of the market's leaders is trading beneath all, everyone of its major moving averages. that is highly unusual. yesterday amazon closed beneath the bullish trend line for the first time. amazon has been under performer all year but it looks like it is on the verge of a serious break down. considering another long term market favorite, monsanto. i think of it as a bio company. when you look at the chart the picture seems grim. the stock is breaking down from a nasty head and shoulders pattern, one of the most negative formations in the book.
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typically head and shoulders situation a stock gets crushed after the right shoulder is finished forming which is in sync with the weak outlook the firm gave today. they are all saying the same. meanwhile, another ominous element. last week monsanto formed its own death cross indicating the short-term trajectory looking worse than the long-term trajectory. look at the indicator that helps predict changes in the stock's trajectory. last week a classic sell signal where black line crosses below the blue one, an indicator that something is about to go wrong. while we are going through the litany of trouble charts i never
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thought this company would have a trouble chart. usb. this is a totally domestic player, incredibly well run being squeezed by low interest rates. points out that it is right on the verge of making a death cross. stocks indicator and worst of all formed a dreaded triple top. those are really nasty. which means steep decline could be in the cards. this is usb. this shows the broad range of worry. what is the take away? he thinks the charts and many others are telling us this is not merely garden variety. sellers are becoming more aggressive across the spectrum while large and small cap stocks are being under cut and thinks the market needs to go lower before we can sustain a serious
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long term rally. here is the bottom line. the charts are looking grim. while i think it is a mistake to get too negative. we have to be comfortable with the idea. . once we recognize that the most general of feds can't create demand indicate that their time has come. u.s. ban corp. say it ain't so. don't struggle with a puny portfolio. i did heavy lifting on gnc and found a way for the stock to get jacked. plus the gas might be a nice surprise at the pump and a havoc for stocks in your portfolio. she's still the one for you.
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ask your doctor about cialis for daily use so ally bank really has no hidden fethat's right. accounts? it's just that i'm worried about you know "hidden things..." ok, why's that? no hidden fees, from the bank where no branches equals great rates. ever since i came out here last month and told you that gnc, the number one retailer of vitamins should acquire its top rival vitamin shop rumors have been rife that gnc is the target of intense interest from private equity space, pondering the idea of taking the company private
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and then unlocking tremendous value. here on "mad money" we like to wear a lot of hats. tonight i think it is time to put on my investment banking cap in order to figure out why there is this interest in this vitamin supplement company. i think the company would create value by taking over vitamin shoppe. what makes gnc attractive to bankers and leverage buyout firms as a stand alone company? after much consideration i think i found the answer. the thing generating so much interest and something that a firm can do after taking gnc private is something you can do for yourself as a publically held company. it would be lucrative for suffering shareholders. one sweeping decision i believe gnc can transform from a fizzling franchise or stock into a terrific retail winner with a stock that could more than
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double from here, more than double. how exactly could gnc pull it off? what is the secret that has so many salivating over the company? it is all about store ownership structure. gnc has what is known as a blended store ownership model in which about half of the 629 stores in the united states are franchise while remaining are owned and operated by the company itself. those are the operative terms. here is the crazy thing. when you drill down it turns out gnc makes the same amount of money from its franchise stores as it does from the company-owned locations. over the past four years per store they have been the same or higher than the numbers from the company-owned stores. over the next years gnc expect to be 20% more profitable than owned and operated stores. it kind of took my breath away.
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i said wait a second. in the retail business it is supposed to be more profitable than the franchises. the way a franchise model works the parent company manages the operation of the stores and the parent makes money by collecting royalties and fees from franchises. in the case of gnc they make the same profit from franchises. you see where i'm going here? given the franchise is more profitable for gnc there is absolutely no reason for this company to own and run any of its own stores. all these company-owned stores do is tie up the company's cash. can't give you the dividends and buybacks. here is the one move that i think can send it soaring. gnc needs to sell and re-franchise. remember private equity funds are flushed with capital here and desperate to find bargains. i bet they jump at the chance to
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buy the stores. how much cash can gnc raise by refranchising the stores that it owns and operates itself? we have been seeing re-franchising deals. dunkin donuts. let's say gnc can get half that. that works out to $275,000 to $550,000 per store. if gnc sells all stores it would raise $1.5 billion in cash. i think you can get more than that. for the purpose of this i am trying to be conservative. once moved to 100% franchise model that eliminates rent expenses and general administrative expenses. the leaner business model the company's leverage cut in half meaning gnc is able to borrow money without compromising credit rating letting them raise another billion dollars in cash.
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gnc could raise $2.5 billion in cash without doing damage to the company's profitability at all. given it has the market capitalization that means $2.5 billion in cash it can buy back nearly 75% of shares by retiring -- it is expected to earn $3.20 per share. i calculate $8 per share. trades 11.8 times next year's earning. if they can earn $8 per share next year thanks to an aggressive buyback $94 stock. 143% higher than where it is currently trading. pie in the sky? companies that refranchise get rewarded. we talk to all of them. think dominos pizza, jack in the box. this stock can go higher with my plan. will gnc embrace it? company's new ceo who took over
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this past august smart guy but only if the company doesn't embrace this plan i bet somebody will take it private and do what i proposed. i don't know if gnc and the new ceo will take me up on this. i know when the company reports i do not expect good numbers. that could be your chance is the restructuring would rid the company of near term earnings woes. when it makes as much from franchises as company stores it is too to refranchise. i think the stock can rocket higher. you know what, if they don't do it someone else will buy the company and do it for them. let's go to vinnie in florida. >> caller: how are you doing? >> i'm doing good. how about you? >> caller: not bad.
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a good guy just passed away. you pick him up where he left off with me. >> you are very kind. >> caller: jd.com, your thoughts on this. and the dollar seems to have hit it a bit. what is your view on the future of jd.com? >> my favorite here in china. we like vip shop. we like jd. we like alibaba. the whole market for speculative stocks have come down a bit. i think alibaba is cheaper than jd and i thank you for the kind comments. you are out there slogging it is nice to hear nice things. let's go to paul in texas. please, paul? >> caller: i want to talk to you
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about walgreens. since august 4 when walgreens got rid of their cfo stocks had a bumpy ride. one of the things i learned from your book "real money." is you have to take changes. >> we made some mistakes this year. we made them when we were too aggressive, when a stock hadn't come down in advance. walgreens is down huge after the mishaps. that is why we like walgreens. it has gotten the stuffings kicked out of it. i think it is a good international change. walgreens is 61. i like the risk reward. doesn't look like bulk up season. i think gnc needs to trim the fat. if they don't do it someone else will do it for them. if i didn't have this job i would go to private equity and do it. i always wanted to own a supplement business.
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much more "mad money" ahead. who doesn't love lower gasoline prices? several stocks are getting slammed because of it. we don't talk about it. we are changing that tonight. i have the names and taking on the best you can throw out there. the lightning round is just ahead. tigers, both of you. tigers? don't be modest. i see how you've been investing. setting long term goals. diversifying. dip! you got our attention. we did? of course. you're type e* well, i have been researching retirement strategies. well that's what type e*s do. welcome home. taking control of your retirement? e*trade gives you the tools and resources to get it right. are you type e*?
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alcoa still manages to deliver a terrific quarter after the close today. a magnificent earnings off the 23 cent basis. substantially higher revenues. no one was looking for that and the company reaffirmed the growth forecast. this stock has been on a real roll lately more than doubling over the last 12 months up 28% since we last spoke to the company ceo in april. as alcoa increasingly making high margin aluminum products. they are replacing heavy materials like steel with lighter aluminum as a way to boost fuel efficiency all coming
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together. why don't we check in with the chairman and ceo of alcoa and learn more about the quarter and his company's prospects. welcome back to "mad money." >> good to see you. >> congratulations, you traced out a long time ago when we first met a path that alcoa can go on where it can become proprietary and close difficult plants. where you would find new uses yourself using intellectual capital. it has all come together with a shockingly better than expected earnings and revenues which are the real drivers of how to pull off the top/bottom beat at a time when everyone is worrying about a softening world economy. >> you said it already. we basically are building two things. one is a multi materials innovative lightweight
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powerhouse. we are getting a globally competitive commodities business. this quarter tells the story. you see that we are firing really on all cylinders. we have the best performers ever on absolute basis as well as on the margin basis. we saw an increase of profitability year over year and the best quarter in the upstream business since the start of the crisis, since the second half of '08 when it started to get weaker. and so what have we done? we have on the one hand improved our capabilities and value add side. you saw it again this quarter. you basically saw we have announced the acquisition of doubling the content in engines and jet engines. we already were strong in this and now we are stronger with this. by the way, most of this is not
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aluminum. most of it is titanium or nickel. very, very cool adding technology into it. we announced last week the opening of our aluminum plan in lafayette, finding new like in automotive. 28% of capacity is close. we closed again. we closed again some that most thought are never closeable. we did it. at the same time we came down on the cost curve and increased our value proposition and here it is. the profitability is there. we got a little bit off tail winds there and that comes together and i think it confirms we are on the right course. >> why is aluminum, why is it not like the grains, not like oil, all of which are in full
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right now? why is this metal different? >> it is different for a host of reasons. i can only speak to aluminum. we see a growth for aluminum of 7% consumption growth. the second thing is when you look at the premium which is a reflection of physical demand which is more of a function of general sentiment because most of the players in that market really don't want to come close to the aluminum. the premium is up. it is at a record high. it would be showing that the physical demand is very, very high. and it is a reflection of the end market. look at this quarter. we have two record contracts,
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one coming from the engine side, one billion plus contract. the second from boeing. 1 billion plus multi year contract. the second one basically all aluminum alloys also in it. you saw automotive. the f 150 comes to the show room in the fourth quarter. you saw the uptick in the commercial trucking business here in the u.s. particularly. very, very strong end markets and aluminum penetrating the markets. building and construction another great market. we have a lot of good things happening and we have the right products and we have technology that meets the demand that really caters to what the customers need. >> you said europe isn't as bad as you think. you are actually increasing europe 2% to 4% global production for auto. are we too gloomy? >> yes, we might seem a little
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too gloomy. that is one thing. if you look a little bit more specifically the reason why we are upping it because our number was a little bit on the conservative side when we looked at the first half of the year. when you look at really what has been going on in terms of order intake if the fourth quarter goes further down which we expect, we expect further weakening in the fourth quarter in the european automotive market. for the year that is what is driving is up. that is a technical correction. i think i would go in line with folks that when you talk to the europeans they say european auto market is suffering and suffering relative to the strength that it had in the beginning of the year. that is really correct. >> there has been talk that maybe aero space has declined in growth. your reports make me feel like it is strong and could get stronger. >> i absolutely agree. as i just said, i mean, what are
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the big drivers there? you saw on the one hand we project for this year 8% to 9% growth in aerospace. we think it is 7%. this is a market. i don't know whether i know any other market or have seen any other market that has a nine-year back log. if there is cyclic cality coming in we don't think it will hit anything in terms of a dip in orders in the next three to five years. much of that is driven by what is happening on this planet. more middle class people wanting to travel. the other cool thing what is driving demand for new airplanes is driven by fuel efficiency and fuel efficiency is driven by new engines. that is why it is so exciting that we are expanding on the
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engine side. our capabilities. most of it not aluminum. this is very, very exciting because it caters exactly to that sweet spot. >> you changed it. it is not a story that blows with the wind or blows with commodities or blows with the gross domestic product. it is everything you said it could be and it happened. congratulations to chairman and ceo of alcoa. >> alcoa has gone higher. it really pulled it off. maybe it can break away from the gloom that has unfortunately subsued me. "mad money" is back. in a world that's changing faster than ever, we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different -
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it is time for the "lightning round." are you ready? time for the "lightning round." let's start with peter in california. >> caller: my stock is mdso. >> cloud solutions space for health care and medicines. i think it is a good company that has come down quite a bit. i like the level. i would be a buyer.
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kind of reminds me about the how i felt for concur. philip in florida. >> caller: the stock i am looking at it hertz. down 27%. is this a double down? >> i was -- this industry turned down. what happened is look at avis, that company has been clubbed, too. i thought hertz once the ceo was booted the stock would come back. i think there is great value there. people are talking about how if the rental equipment business is not doing as well because they watch uri. i reiterate that i like hertz but i say it would be higher. glen in new jersey. >> how are you doing, jim? i would like to do avalon bay.
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>> i think avalon bay is good. 3% yielder with good growth. these days those companies have fallen out of favor. people would rather be in dominion or con ed. they don't like risk that the economy slows down that much. i like avalon. carlo in florida. >> caller: thank you for the good advice throughout the four years i have been in the market. tell me what to do with buffalo wild wing. >> a lot of people have given up with buffalo wild wing. the travel leisure group has been weak and people feel they have to pay more money for wings. this stock i have watched come down big. it is really buffalo wild wing coming down high from the top down 13% for the year. i think it is a level to pull the trigger. peter in california. >> caller: hey, buddy. gilroy, california. i got a question.
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wind stream holdings, buy, sell, hold? >> i think it is played out. i think you have had the move and went to the real estate investment trust. i would not buy it at this level. thomas in florida. go ahead, thomas. >> caller: hello. >> you are up, it is jim. >> caller: how are you doing, jim? >> how are you? >> caller: good, sir. from miami, florida. >> good to have you call the show. what is going on? >> caller: nothing much. i wanted to know your thoughts on plug power. >> i am not a big fan. i think every time it gets up to this, it is up over 100%. they issue stock or do something disappointing. i think you ought to take profits in plug. you want a speculative stock go buy solar city or first solar.
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i know people say jim cramer on twitter that you are wrong on this or that. no. i'm not. let's go to laurie in california. >> caller: hi, jim. i'm calling about the pacira pharmaceutic pharmaceuticals. >> this is totally speculative situation, different kinds of pain medications. i bought last year on a playing. it has been speculative and gone up a lot and still speculative. if you want to speculate i bless it. understand the speculative stocks have been crushed of late. that is the lightning round. go ahead and put your bag right here.
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have a nice flight! traveling can feel like one big mystery. you're never quite sure what is coming your way. but when you've got an entire company who knows that the most on-time flights are nothing if we can't get your things there too. it's no wonder more people choose delta than any other airline.
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whatever happened to the promise of natural gas as the surface fuel in this country replacing oil-based gasoline and diesel? where did it go? why does it seem irrelevant. regular engines got cleaner, one of the key selling points came from proof that they burn cleaner than diesel. at the same time working to develop the next generation engine from that gas cummins was
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creating a cleaner diesel engine. you can see it in the horrendous numbers reported last week from westport. truck engine sales are getting hurt. second, the price of gasoline had to go higher to make this natural gas technology viable. the glut of domestic oil and cheap crude from saudi arabia makes it less economic another reason i think trying to discount oil with gasoline at $3 a gallon we will not develop our natural fuel industry. natural gas held up in price and is hanging in there. conversion has slowed as pretty much all the switching we can expect has happened there is still oil fuel buildings in the northeast. natural gas should be much lower than it is. since we are still flaring off more than we use i think the price remains high in hopes we export the stuff.
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when you consider the sheer energy development it seems unlikely that more of a handful will ever be built. the price is sticky high, hurting the surface fuel thesis which brings me to reason number four the payback for engines is just not there. they are too expensive. at a time when gasoline is going down in price you can't have natural gas engines be so pricey that payback period takes multiple years especially since we don't have the infrastructure in place. that is why at chart industries gtls which had high hopes has seen its stock cut in half. the future is not as bright as we thought. all of the factors combined to frustrate the use of abundant capacity. without subsidies not higher but cheaper i expect high lower
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gasoline will put a stop to natural gas entirely. since the new trucks don't use as much fuel as they used to the competition is tougher for natural gas vehicles. we know the marcellus shales are brimming with natural gas and are in a position to be domestically independent. with gasoline coming down i think it seems further away than it did three or four years ago because right now we have the worst of all possible worlds. too much natural gas with no plans for it to be used on a grand scale. what a terrible waste. stay with cramer. $21. could something that small make an impact on something as big as your retirement? i don't think so. well if you start putting that towards your retirement every week and let it grow over time, for twenty to thirty years, that retirement challenge
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might not seem so big after all. ♪
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will there be more alcoa than ford? alcoa said we were all too gloomy and said europe wasn't that bad. you go back a week ago and listen what ford said and the world is definitely in a deceleration mode. i say more fords than alcoas. when the market comes down hard like yesterday that is when the alcoas aren't represented. after a day like today we have
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too much anti-ford like optimism. somewhere in between is where reality is. if you have big cyclical stocks let them go. let them go. there is always a bull market >> narrator: in this episode of "american greed"... trevor cook claims to have a revolutionary new way to trade foreign currency with guaranteed profits. >> investments were safe and protected and in segregated accounts. >> i am here to give you solutions to this massive fiscal pollution that everyone in this country is experiencing without exception. >> narrator: and more than 700 investors rolled over their life savings. >> i thought, "this is very impressive. it's invested overseas, so therefore it isn't taxed." oh, my goodness. this is just too good to be true, isn't it? >> narrator: but no one knows that cook and his partners are

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