before you take out those hamburgers and hot dogs, here's what's coming up ♪ >> investors have and shares surge. but if you're tempted to take them for a spin, don't there's something in charts that looks troubling. we'll explain. plus -- >> money will always be paper. but gold will always be gold >> gold's doing something it hasn't done since 2011 and it could spell more gains

ahead. we'll tell you how to cash in. and alibaba is surging as amazon stalls out but we want to know which is the better buy the action begins right now. ♪ >> let's get right to it car stocks have been on fire ford, general motors, both up 5% avis is up 15% while hertz is up 22%. is is it too far, too fast mike >> yeah, i think it is a little bit. i'm not sure, maybe some optimism coming from the fact that there's going to be some car purchases related to what obviously the disaster going on in houston but the fact of the matter is that the secular head winds for the rental car companies and major auto manufacturers remains in tact. even know with the stocks having done well this week, multiples tell you this. you wouldn't see them trading at sempb, eight, nine times

earnings i think they believe we'll maybe hit pique. >> i typically agree with mike and carter they're smarter than i am. look at ford over the last three and a half, four years series of lower low, lower highs on a broader market tape that's been effectively straight up in an industry where they were selling cars at record paces my question is, if the stock couldn't go up then, could it now? if you want to be in the space, we mentioned it yesterday, auto nation is the place. >> that's going to be a short-term boost for sure. but you know, one quick thing. texas is the leading place for pick up truck sales. the most profitable truck they sell let's assume you've got a half a million to a million new cars sold it's going translate to about 35, maybe 40,000 f-150s, 350 to $400 million would be the net effect of that versus 7 billion, that's a one time potential boost

it's not something to trade off. >> there are moves in principle are enduring, it could be the beginning of something longer lasting and moves that are impetuous u. often news related and the move that simultaneously took ford up and gm and some of thoe those feels more impetuous than developmental. >> there's an argument that need to be made for the inventory that was the thing dogging this groum. we were talking to adam jonas and morgan stanley and he said this is mother nature's cash for clunkers program >> yes >> it's a huge transfer of wealth from insurers to the consumer and in turn to the auto industry >> but the secular head winds mike and carter said, the secular head winds that excited prior to this hurricane, they are not going away they will abate for a brief period of time and you hate trading things on the back of a disaster like this, but this is going to be a one time maybe one quarter, two quarter phenomenon. yet those head winds will still exist, so, look, again, these stocks have gone down for a

reason i think if you get a bounce, you sell them. >> this cash for clunkers represents a at best, 5% of new car sales annually in north america and about a third of a percent of the fleet under the best of circumstances. so, you know, a lot of that fleet. people keep talk iing about that rolling off. 11.5% is the average age for the cars we've got so there's a lot of things you could say would be the reason for a new auto cycle >> carter, why don't you show us >> exactly what guy was talking about. the destructi conduction over the last three years. here, this truly tells it all. this is a chart that goes back as far as s&p 500 sector data will go. meaning in 1989, 1990, they changed the nomenclature data before that is not the same sector set up as we have now this is nothing short of outu standing, remark bable or able ridiculous what we have in orange is the s&p 500 consumer discretionary sector one of the part of the whole,

the market of course, it's best if the s&p if you were to look at the s&p, the s&p not as good. now, down here, these are positive numbers look at ford this is a joke so, you actually lost money. since 1989 investing in ford that tells you there's something wrong. more immediately here and now. so, just to put it in context, ten grand. these numbers are clear, yeah? ten grand. 84 grand ten grand is s&p, 61 ten grand, down. you're down negative numbers this is a joke so is that about to get better with with self-driving cars and uber and all the stuff no way the long-term chart. i think you can draw the lines anywhere you want. one thing to comes to mind is that not pretty to the here and now. one year chart of ford no drawings, no line, no judgments by me. here's a line. that's a pretty straight down trend.

it has failed off the line fail ed off the line. that's going to fail again let's pull it back further two year dhart no longer or drawings by me. here comes the line. these are the same thing fails off the line fails off the line fails off the line going to make the bet it's going the fail again pull it back more. guy was talking about the three, he's in the five year putting the lines. a well defined series of lower lows and so, why are we going to bet anything other than with history? with precedent i don't like it. >> can i ask carter worth a question you know the way i feel about carter >> in the top three of all guests that have ever appeared >> what's that thing, the one with all the heads and rock, mt. rushmore but i have a question. as i pointed out, the broader market has been unbelievable if the broader market were to turn to the downside, is there safety in owns ford or will that roll over as well in. >> no, in principle, the things

that do the worst in a bad market are two things. things that have never really rallied with the market then fall out then the opposite, things that have been very extended, which people rush to take profits, there's also this. maybe the dividend is is going to help. the 5.2% ford's cut its difr dend 50, 60% several times in the history of the company. the dividend is always good as the next six months. not a value play not anything you know, that is pretty clear, isn't it >> yeah. i don't think that you could be anymore clear carter than in the past few minutes >> how udoh you feel about this? >> el selling the october 11, 12 call spread. stock ended up about 3%, so this could collect more than the prices that i saw when looking at this today. you could sell the october 11 calls for 50 cents, by the 12s against it for a dime, you're collecting 40 to 45 cents for this this is with the stock below

11.5 you could have an opportunity to make a small profit if is stock sits here. we're protected at 12, just in case by some miracle it happens to break that downward trend line we just identified >> right >> does the chart look the same for gm >> well, gm also rallieded hard this week. gm hasn't been as broken as the ford chart over the consistent five-year period, but gm is no party. there's smog wrong with the industry it's things you guys are talking about. >> jim's been sideways to slightly lower, where ford has been pretty much, that chart sill strait illustrated it they both have issues. the worst stock is top of the order ford not that there's safety in either >> what would cause you concern about this trade >> in the next few weeks anything >> unlikely we're quoing to see anything fundamental that's going to emerge. if anything would concern me, it's the same that's concerning me about every bearish bet i've made this year, which we can identify, you know, caterpillar

among them and many others situations where i think there are plenty of reasons why the stock should have hit a top or should be rolling over that would be the one possibility if we get a really strong rally in september, it could lift all those shifts ge. >> shifting gears to gold. the medal having its best week since february, but some options traders aren't going along for the ride >> that is right the precious metal is now up 15% this year. gold's rally has been fueled by a weaker dollar and its flight to safety. but the options market does not appear to be as bullish. according to occ data, overall open interest on the gdp options is up 10% this month, but the majority of that increase has come on the put side in fact, bets on puts have grown 18% while call interest has only seen a 6% gain this month. if gold were to hold its year to

date gapes, it would be the first time since 2011 that gold has beaten the s&p melissa, back to you >> thank you very much that wouldn't be bad for this year, guy. did you buy into though >> i think there's something going on with gold we had a great conversation with steve liesman. and we talked about we asked him, are you concerned this administration talks about this dollar as much that has doi? we had a great conerer sags. he wants a weaker u.s. dollar. a weaker u.s. dollar will be good for gold. look at gdx. it's now pushing up to levels we saw in january i think there's a stealth rally and i wouldn't fade it here. >> sounds like it's not because of geo political risks >> that's the cherry on top. >> it's a risk off trade, but we have seen the levels of other commodities rise as well so i clearly, it would make

sense in that context. the opgs market, we are seeing premiums go up this is not unsurprising often time, when commodities rally, they anticipate higher volatility going forward that's quite unlike eck quities. it certainly has the ability to move and probably more sharply than it has even so far. >> what's interesting, this not randomly is an anniversary we know that the pique in gold right was in 2011, it was september 2nd. a friday here we are friday, september 1st, 2017 and we came down 1877, all the way to 1129. now back up to 1330. it's got momentum to it. whether it's because they're never going to raise again or because people think they're going to fly, whatever, it's got, it's got momentum and momentum is one of the most powerful forces both on the way down and up. it's going higher. i would say. >> chart master likes the gold >> the dates out, it's poetic. the way he compared the highs.

>> i am bik pen tamme terror >> quickly, gold miners or gold? >> generally speaking, the miners have a little bit of leverage where gold is determined, but i'd probably rather the medal here, if we start to see weakness, cash flows into the commodity, gld is a straighter way >> got a question, sebd us a tweet. if it's nice, we'll answer it on the show and check out our website. got videos, tutorial, winning lottery numbers. you get the picture. check out our super cool newsletter here's what's coming up next >> alibaba shares have doubled but if missed the move, relax. we'll show you how to buy it for less than $5 plus, calling all options action fans reach into your pocket, grab your phone and tweet us your question at options action if it's nice, we'll answer it on air. when optio aiorern nsctn tus.

. >> logical ey john, i'm connecting our brains so we can share our amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade. duncan just protected his family with a $500,000 life insurance policy. how much do you think it cost him? $100 a month? $75? $50? actually, duncan got his $500,000 for under $28 a month. less than $1 a day! his secret? selectquote. in just minutes a selectquote agent will comparison shop nearly a dozen highly rated life insurance companies, and give you a choice of your five best rates.

duncan's wife cassie got a $750,000 policy for under $21 per month. give your family the security it needs, at a price you can afford. since 1985, selectquote has saved over a million families millions of dollars on life insurance. steve, other than making me move stuff, i'm here at the td ameritrade trader offices. what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place

and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. see options data like never before. with thinkorswim only at td ameritrade. if you think amazon has a good year, check out alibaba let's get to diedra in san francisco with the story hi, diedra >> hi, melissa that's right, amazon's had good year 30%. but alibaba has had a better one. its shares nearly doubling that puts it within striking distance of dethrowning amazon and in the race to half a trillion dollars in market cap over the month, alibaba is up 10% since august 1st on the back of an earnings report that blew

past estimates amazon's rally has halted. shares falling 1% and down about 100 bucks. from analysts, alibaba gets more love of the 47 brokers that cover the chinese tech giant, not a single one has a -- its price is 197. about 15% higher than what shares stood today according to fact set am sop has one sell rating and it's about 17% from its mean tashlgt price. now, guy, both dominate e commerce in their respective markets, u.s. and china and both are expanding into new business, like groceries, original content and cloud, but one of the major differences is that alibaba has the much larger and faster growing chinese market an of course, the middle class some investors see alibaba as a proxy and that's part of the reason alibaba has returned more than three times what amazon has

this year. amazon continues of course to dominate e commerce here in the u.s. cloud growth slow iing a littlei comparison to some rivals and some say that uncertainty over its whole foods integration may be giving investors pause these days >> thank you, diedra, in san francisco. if you missed the big run, fear not. mike has a way to buy the stock for less >> we're going to talk about a structure calling a call spread. secondly, this is a structure you want to use when options premiums are slightly elevated and finally, this is a trade that helps you mine miz your risk particularly. to buying the stock as an alternative. phenomenal forms from alibaba. we're start tog see more volatility sometimes, that can be a warning sign that's reflected in the price of option, one of the reasons we're going to use a spread, so specifically, i'm

looking up to january and looking at the 0, 200 call spread she was identified 197 in change we can spend 5.60 for this sell the 200 against it for $4 that's over a kaurt quarter of the distance between strikes gives us time for this to play out. as you can tell, $5 on 182, $200 stock, it's not a lot to risk when considering making a bullish bet here how does this trade go awry? >> it goes awry if it goes down. i kind of think that's unlikely though the increase is suggesting to see moves at least of the magnitude we saw for the firgs portion of this year until the year's end this is going to profit if the

move is upwards. in terms of amazon or baba, which looks better >> amazon has endured selling of some kind. it's been under pressure it makes it vulnerable is just that no weakness, no one's dieded yet and it's breakout. from the 120 level in june now, it's 170, 175 it's come a a long way stretch in fact, they have risks, i would say >> these are not cheap stock, wung thing we can say is that the chinese market is faster grow iing than this one. it will soon be -- is at least as big as amazon's is. but look, you're doing is, this is a momentum trade, where mitigating our downside for that reason is amazon's performance

indicative of where you think fang as a basket could go? >> apple has been on to itself and microsoft, super cap, large cap grout, but google and amazon has beve been soft and other rs not great it's struggling. it's really -- of these big ones, i think apple is the best in term of its -- >> up next, caterpillar on a tear this past month. bad news for got an options question for our traders, one or our special guest, guy re t bt esn r. oai more right after this. hey gary, what'd you got here? this bad boy is a mobile trading desk so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right? oh, so my custom studies will go with me? anywhere you want to go!

the market's hot! sync your platform on any device with thinkorswim. only at td ameritrade

oh hey john, i'm connecting our brains so we can share our amazing trading knowledge. that's a great idea, but why don't you just go to thinkorswim's chat rooms where you can share strategies, ideas, even actual trades with market professionals and thousands of other traders? i know. your brain told my brain before you told my face. mmm, blueberry? tap into the knowledge of other traders on thinkorswim. only at td ameritrade. welcome back ko and carter said caterpillar surged too far, too fast >> they're a miracle or going

the same way i'm a seller >> i'm inclined to go along with carter here. i'm going to buy a put spread to do that. the october 1 spread, you could spend about four and quarter for the october 1 sell for 60 cents, spending $3.65 for that. >> the stock rallying 4% since then, so mike, what do you co? >> we have until october for this and the value of the trade has declined on the meantime on caterpillar's recent strength. my thesis, certainly the fundamental thesis that i had remains in tact. this is one of those situations where we used to have big industrial names like this we were talking about it earlier. cyclicals, you would see the pes dropped. they have not, now, basically, it trades at a market multiple, they don't deserve to. >> and the principle being of this fairly uncorrected advance over such a long period of time, leaving us at a difficult level, guy's going to talk about it,

but we want to stay with this. we got lots of time. this is so much. can eke out gain, but can it collapse >> i agree if you go back five or six year, you're setting up for a potential for major double top in caterpillar valuation in my opinion is extraordinarily expensive if you think cat is going higher from here, i've said it for a while and corrected, you got to believe that every hole that's going ton dug over the next year is is going to be one of those big cat tractors with one of those hooks on the back ain't happening, sister, back to you >> industrials as a whole up 8% so far this career and there's real stellar performance take a look at general electric. just this week just today in fact up 2.4%. >> ta happens when you're slipping going into a five-year slot like ford ge is a disaster it was pique d at 33. stocks up $24 stock. losers pop their head up >> we've got a new ceo though.

going to cut staff and slim down and reorganize the business. >> made a big, bearish bet using the strength we saw as an opportunity to sell. tis naca fm e l llroth oponpits i'm here at the td ameritrade trader offices. steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. see options data like never before. with thinkorswim only at td ameritrade.

hthis bad boy is a mobile trading desk so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right?

oh, so my custom studies will go with me? anywhere you want to go! the market's hot! sync your platform on any device with thinkorswim. only at td ameritrade welcome back time to take your tweets our first asks if you're confident, want to buy call, deep in the money or at the money. mike, what do you say? >> i would say at the money. you are paying more extrinzically, more kay, bdecayt they're just buying stock. >> time for the final call last word. carter >> 11.35 bet it's going lower back to where it was pre harvey. >> mike. gl you are bull militia b k aba, it's a better play to january that than the stock. >> guy, it was fun >> dan wilson.

>> who's dan who's dan? just kidding hi, dan. >> energy stocks next week if they don't turn next week, they ain't turning >> looks like our time has expired. thanks for watching. for more, check out the website. have great long labor day weekend. "mad money" starts now starts right now 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 make you some money. my job is not just to entertain but to educate and teach you so call me at 1-800-743-cnbc or tweet me @jimcramer. when is a loss a good loss when is it a bad loss?