>> and vanilla ice. >> he's still around. >> ice-t today and i'm jim cramer and welcome to my world. >> you need to get in the game. >> firms are going to go out of business and he's nuts. they're nuts. they know nothing. >> i always like to say there is a bull market somewhere. >> "mad money." you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. just trying to save you a little money. my job isn't just to entertain but i want to teach you through these difficult days. call me at 800-743-cnbc. have we been down so long it looks up to me? do you know that's become the prevailing wisdom of late on wall street? a key prop the bulls are relying on to stay in the game or keep buying stock. although you couldn't tell from the action today where the dow sank 77 points.

s&p lost .7%. nasdaq gave back a lot of yesterday's gains. time to talk contrarianism, and whether that kind of thinking is working as a strategy. from my perspective, frankly, it's just hit or miss. that's not good enough for me to recommend it to you as a course of action. first of all, let me set the tableau so you understand exactly what i mean when we say somebody is a contrarian in the stock business. there is a huge school of thought on wall street that goes something like this. when a sector is so hated, when it is so disliked, held in such low regard then it's probably time to change your mind and start liking and buying it. why? because if everybody hates something the odds favor it, at least according to this kind of thinking, that it is immunized against big declines. the idea being that if everybody hates something they don't own it, so there is no one left to sell. immunization. i get this.

i see polls that show many bears and just a few bulls i'm tempted to think people are too negative. could have a snap-back rally. when i heard that there is a huge amount of money betting against the sector i don't want to be part of the negative group thing. if something good happens you can catch a real rip snorting rally as everyone switches direction at once. for example, it's become perceived wisdom that oil, which has gone down $25 in a straight line, just has to go lower still. why? people despise the stuff. the conventional thinking has it that oil won't stop going down any time soon. perhaps falling to $75 from the current $82 perch. i see gigantic bearish wagers against everything oil and oil drilling. yet i know if we got a sudden spike in oil the bet would go totally awry. that said, i want to talk about the two most hated sectors out there right now, the industrials

and banks -- and the chatter that says they should be bought because they are so out of favor. close your eyes. buy them. first the assumption -- well, the presumption is clear. these stocks are so disliked that no one owns them -- quotes around no one owns them -- meaning the big money portfolio managers are what's known as underweighted in the group. okay? that's wall street speak. i usually don't like to use it. i like to bust it on the show. but it is wall street speak for managers having less of a percentage of stock in industrials or banks than the percentage of industrials or banks in the s&p 500. you got to understand this. this is the way they think, these big money guys. you have to understand the underweighting concept. it's key to the contrarian thesis. portfolio managers are always trying to beat the s&p 500. the way they can do it is to overweight a particular sector meaning own more of a sector than is represented in the s&p. or underweight a sector versus its percentage in the s&p.

if you think industrials are going down you obviously want to own fewer industrials or be underweighted in the sector. if you think the banks are higher you want to be overweighted or own more banks than are in the s&p. here's the rub. all the surveys show the vast majority of managers currently are underweight financials and severely underweight industrials. when you see severe underweighting like now it means if anything good happens out of the oil situation there will be, indeed, a mad dash to add to underweighted groups. that's how rallies happen. wow, i hate the industrials, but i have to buy them all. things have gotten better. now that you understand the thought behind the contrarian mindset here, let me tell you what i think of it. nah. i think it's wrong. i don't even think it matters. it's a really treacherous way to invest. we've had giant show cases of banks and industrials. coming to new york, dog and pony shows, strutting their stuff telling you why you should buy our stocks. you would think it would be a terrific time to make that contrarian bet.

so many managers are underweighted. something good happens, you might get a tectonic shift that brings money into a given sector. sure enough, it worked a little bit, at least in one group, the banks. but it backfired big time with the industrials. wow. that inconsistency makes contrarian investment too hazardous for me to tell you to do. what happened? as soon as the industrial managers started talking about their businesses -- the ceos, what did they say? they said things were weaker than people thought. they hinted that things are so soft that they can't make the earnings estimates that the analysts are predicting. the culprit? repeat after me. europe. of course europe. so what happens? even though these stocks are underowned, many of them who did own them immediately panicked and sold.

they sold them anyway. that's right. the shareholders didn't say, ooh, nobody owns these. i'll hold them right through. no, they said, ah, get me out! i don't want to own industrials. get me out! that's why caterpillar, cummins, emerson, 3-m, honeywell, united technologies sold off. i should say got hammered. why did these managers panic? they know europe is getting worse, not better. you will hear later in the show joy global, same deal. we can't look through that valley. it's too deep. contrarians can't take the pain. even when we would have thought they would have been immunized against it. the banks told a not so hot story. unlike the industrials they told a story of things getting better, not worse, because of the change in fortunes of real estate. while banks may not make much money investing your deposits or making a huge amount off loans, a number of bad real estate loans are going down.

housing is turning. that's huge for these guys. managers who don't own the banks or are underweighted in the group felt better and bought which is why wells fargo and pnc held their own. it didn't even tell a good story. nevertheless, i think you're playing with fire when you invest in a group because portfolio managers don't like it or have exposure to it. sometimes the conventional wisdom is right. sometimes like in banks the conventional wisdom may be wrong. when it comes to picking stocks, i don't like to rely on the sentiment. i use fundamentals. how's the company doing? industrials with european exposure for the most part won't make the numbers. things will be worse for the companies and therefore the stocks. banks on the other hand, may not make the numbers either. but next year is going to be better. it's far better than to own the stocks of the banks that could

improve the most and sell the industrials that won't. bottom line. do not worry about whether stocks in sectors are underowned and unloved and therefore should but might not be immunized against declines. just find the stocks of companies that are improving and don't think about the ones that aren't. i bet you will make a lot more money than the brilliant contrarians who don't realize there is always somebody who will sell the stock of a business that's getting worse. even when you think there is no one left to sell. dave in washington, please. dave. >> caller: hey, jim. how are you? >> i'm good, dave. how are you? >> caller: i'm standing atop grand cooley dam in washington. it's amazing. >> wish i could join you. >> caller: you were talking about pepsi versus coke. you were leaning toward pepsi. i own some coke. should i wait for them to split and see what happens then or go ahead and sell? >> you don't have to sell coke.

coke is fine. i was pointing out from a relative valuation, i like pepsi. i just felt at this particular time pepsi got a little too cheap versus coke. if coke went to $70 and pepsi to $72, different story. coke is better than 90% of the companies i'm following now. roger in new york. >> caller: boo-yah from rainy long island. >> we ought to go to the grand cooley dam. >> caller: there you go. kudos for speaking out about jpmorgan and the wall street investing practice. >> you don't think i will take heat for that? maybe i was out on a limb saying it was bad. >> caller: no, no. >> i think real people get it. how can somebody lose tens of millions and be fine? looks good in front of congress. >> caller: absolutely. >> thank you for saying that. i took a lot of heat and i was worried. i have the courage of my conviction. thank you for saying it. >> caller: sure.

you said a couple days ago that celgene has been a dog. what's your take on it? they have a lot of phase one and phase three trials coming out and possible approval on europe soon. what do you think? >> the ceo today announced a $2.5 billion buyback. i'm going to stand here and tell you that i want to stick with celgene. nothing's changed. great pipe. great company. sam in my home state of new jersey. >> caller: first time caller. love your show. >> thank you, buddy. where you from? >> caller: howell, new jersey. >> i'm there all the time. what's going on? >> caller: i would like your thoughts on zynga. what do you think after yesterday's decline? do you feel it might bounce back?

>> this is a tough call. it's been a complete and utter -- [ barking ] -- this thing has been in the bow wow chateau since it came public. as i said during "street signs," every dog has its day. the stock is too low to sell. maybe i like playing scramble with friend so much with my daughter. if it's profitable, yeah. it might be okay. all right. mob mentality? lemmings? don't worry about what sectors are unloved or out of favor. do this. focus on how individual companies are doing. that's how big money is made. "mad money" will be right back. >> announcer: coming up -- >> ready to ride? >> announcer: siri is about to be riding shotgun in millions of vehicles across america. in response, investors sent shares of audio systems maker harmon off the road. can it maintain its course? don't miss cramer's exclusive with the company's ceo next. later, rock and a hard place?

shares of mining equipment maker joy global have fallen more than 25% this year as king coal tripped off his throne. could rock bottom form the foundation for a rebound? cramer talks to the ceo to find out. all coming up on "mad money." >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter. tweet cramer #madtweets. send him an e-mail to madmoney@cnbc.com or call us at 1-800-743-cnbc. miss something? head to madmoney.cnbc.com. well the kids wanted a puppy, but they can be really expensive. so to save money i just found them a possum.

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on a day to day basis the market's been getting it wrong. it's constantly overreacting to any given piece of news. if you have done the homework that can create real opportunities. take harmon international, the maker of speakers and dashboard systems for high end cars integrating navigation of media and smartphone connectivity. harman sells them to automakers like audi, bmw, toyota ferrari, mercedes, volkswagen. it's obvious this is a luxury play. automakers are trying to make

their cars smarter, not just faster or with greater horsepower. for that they need harman. it's growing like crazy in china and india where members of the emerging middle class are eager to buy fancy things. if europe, the rich really are different. harman got slammed with the news that apple is stepping up car offerings. apple plans to offer free navigation and siri in the dashboard. people worry that apple will compete with harman and since apple is a terrible competitor to have harman fell yesterday, closed down 4%. could this be a case where the sellers are jumping the gun? we don't know apple and harman will be competitors. in the past they've been collaborators. having siri in the dash may make more business for harman as it could make the full suite more attractive.

right now only about 10% of cars now have connectivity. harman sees 50 to 60%. siri could accelerate it without taking business away. that's the bull case. we need more clarity on this issue. especially after morgan stanley laid out a very negative case against harman because of the apple announcement which is why i'm thrilled to have dinesh paliwal, chairman and ceo of harman international, here with us tonight talking about where the company is headed and whether it should be seen as apple being the competitor. welcome back to "mad money." >> jim, good to be with you again. thanks for a very good clarification. what happened yesterday was very good news for harman and i think for the car industry. as you know, viewers should know 2 out of 10 cars have fully integrated infotainment systems. from heating, ventilation, air conditioning, safety systems.

harman company plays a very responsible role with the car companies to deliver an experience which is safe and sound. what apple did yesterday was a very good welcome yesterday. they provided a button on the steering wheel so you can press it and get access to siri and some basic operability. we have integrated apple smart device including siri in the bmw which will be launching in two months' time. we're very pleased with that. we see apple as a collaborator not an adversary. >> there is no accounting for what analysts do but why did morgan stanley say you're the loser? that this is apple gunning for harman? >> i wish i could say. people should take more time than two hours writing a quick

report. the fact is today only two of ten cars have this. 87% of the interviews done by car companies and harman would like integrated systems but they can't afford it. so a company like harman coming in, with our help making it more aware this is the feature functionality people can have in the car, would create need. our $16 billion auto backlog would actually multiply to 32 or three times. so in five years' time, my personal gut instincts and the research validating it that integration of such systems like we do would be up to 50%. the rest of the 50% of the new cars would have basic integration which will come from smart devices, not just apple. with android, nokia, blackberry. by the way, we are integrating all of them. it was misunderstood by some analysts. however the institutional

investors, index fund managers found a great opportunity to buy harman. >> dow jones comes out to say harman shares fall again after apple shows map service that could hurt harman's largest unit. can they replace you for map service? >> actually they don't replace. we actually buy map data from two companies. when google came out some said it might be a difficult time for harman. we integrated google maps and google earth in our system and our business has grown 20% in the last two years every quarter. apple doing the same thing gives us more choices to choose from google, navteq. it's a good thing to have more choices. it creates better competition and allows us to bring system

prices down so more people can afford the embedded system. safety must not be forgotten. we bring in dozens of things to produce an environment which is safe and sound. that's what car companies promise to the car buyers. >> one last question. should have been the first question. how's business since the last quarter? a lot of people worried about europe. car sales are okay in the united states. car sales are picking up in china. we're always worried about europe with all these high end companies that are european manufacturers. >> europe could be a concern for some commodity players. fortunately harman continues to enjoy strong growth even from europe we sell about 35% of the revenue from europe. 70% of that gets consumed in germany. 30% out of that gets exposed to china and other emerging markets. we are having a good quarter. bmw placed a reward for next generation infotainment.

the future belongs to full integrated and embedded systems together with hand held devices. i would do a conclusion remark. these are not mutually exclusive. i think we are here to see the handheld devices and fully integrated systems to co-exist. don't forget about jbl, surround sound systems in the car are necessary even for siri to deliver the message. >> you're absolutely right. dinesh paliwal, thank you for coming on and clarifying immediately what i think were a lot of stories that were pretty much seat of the pants and not that well researched. thank you, sir. >> thank you, jim. all the best to you. boo-yah! >> all right. you heard dinesh paliwal, the chairman and president of harman international industries. remember, to come on the show and just refute the stories takes guts. you wouldn't do it, i believe, unless you know it.

the whole world is slowing. but at least we have clarified this siri issue. stay with cramer. >> announcer: coming up -- rock and a hard place? shares of mining equipment maker joy global have fallen this year. has king coal tripped off its throne? could rock bottom form the foundation for a rebound? cramer talks to the ceo to find out. and later, win, lose or flawed? don't miss cramer's take on how jamie dimon did while getting grilled on the hill today. what he has to say may surprise you. all coming up on "mad money." it's family therapy for volatile times. >> we got families from all over cramerica in studio today. >> dr. cramer is making house calls. >> i just want to make you money. >> "mad money family affair" on cnbc. her cup of coffee? how long is this one going to last?

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lately certain segments of the market like the industrials resemble a game of limbo as in how low can they go? take joy global. people view it as a classic cyclical stock. one that does well when economies are booming and gets crushed when the global economy slows down. to make matters worse 60% of joy's revenues come from coal

mining which has been hammered because of falling demand and slowing of the world's economy. this is a tough time to own joy global. stock down 27% for the year. up 40% from its highs in february. how low can joy go? last time commodity prices collapsed and the global economy slowed to a crawl in 2008-2009 joy global lost 70% of its value. the stock could be cut in half. this company is in better shape than it was in 2008 despite the doomsayers out there. the current situation isn't as bad as the great recession. joy global reported less than two weeks ago on may 31. while sales and earnings were better than expected the bookings declined year over year and the backlog was down from january. those are the key metrics people use to develop whether they should own the stock or not. company lowered the full year guidance with management taking a downbeat tone to the point they are shifting focus to cost cutting rather than growth. that day the stock got slammed

falling more than 5%. with joy global down over 40% from highs stock valuation near all time lows in price to earnings and price to book value? maybe it's time to wonder if joy has been overly punished. let's take a closer look with mike sutherland, get a read on the latest quarter. welcome back to "mad money." >> thank you, jim. thanks for having me. >> i think a lot of people have been trying to figure this out. how much of what's going on at joy is cyclical? you get cold weather, a pickup in the world economies and things snap back. how much of it is secular. too many people are phasing out coal. that's an important product line for you. >> if i can answer that question in two different market segments in the u.s. we have seen a pretty significant decline in coal burn and a significant decline in electric power generation. we believe the demand for coal

is switching to gas because gas prices are low. we think that's temporary. under current conditions we'll see a hundred to 110 million tons of coal production come off line in the u.s. we see most of it come off line. we think there's been an adjustment from a production standpoint. most of the excess power generating capacity in coal fired units. as the economy recovers, weather patterns go back to normal we'll see more coal burn than gas burn because of available capacity. in the rest of the world the markets have continued to be strong for us. we have seen slowing in new projects coming into the pipeline just because the global economy is starting to stagnate. we are not seeing the need to rush the next project in. customers aren't cutting capital plans. they are working on the projects they have in the pipeline either under construction or in planning. the balance is that the international markets will serve

us well and help to offset the softness in the u.s. market. we believe there is more upside potential than down side risk at this point. >> last week we had the ceo of american electric power talking about how he would like to maintain a good coal presence but the epa is on his back not to do it. i'm sure other utilities are in a similar position. is it possible this administration or the epa is so anti-coal it might not come back at all? >> out of the decline numbers we have seen in coal demand in the u.s. market we think about somewhere between one-fourth and one-third of that is driven by regulatory requirements and plants that were retired early to meet future regulation standards. two-thirds is driven by economics. today the gas producers aren't making money at $2.50 gas. those gas prices need to go up to provide the incentive to continue drilling programs. we see about two-thirds of the market decline driven by

economics and weather patterns. both of those we think are recoverable. >> i want to try to distinguish and you helped me between 2008 and now. you said there was a lot of demand for projects but credit wasn't available. do you think the same credit contraction could occur if greece or spain goes down or do you think credit will be plentiful no matter what? >> well, our customer base is working off self-generated cash. credit comes into play at the consumer level and the end use level for commodities. we are seeing slowing down in the end markets today because of credit conditions driving a higher level of patience among our customers to bring the next cap-ex project online. we are seeing a slowing but it's indirect effect rather than a direct effect. >> where is the biggest risk? let me bring up china. they are still opening up coal

plants. they haven't scrapped those. if you had to look around the globe, where is your biggest worry and what could be your quickest snap-back? >> certainly the emerging asia. it includes china and india. it's building the preponderance of power building capacity today. we have the equivalent of 345 gigawatts which is half the u.s. capacity. we see the markets with tremendous upside. still relatively low in their stage of industrialization. we see the upside out of those markets right now. china is showing better statistics. the housing prices bottomed and started back up. purchasing manager's index is moving up. we see fixed asset investment up in the month of may. we're seeing positive indicators, at least indicating that china is bumping along the bottom. we are not saying it's starting

a recovery. it is bumping along the bottom at this point. >> your stock continues to go down. you do generate a lot of cash. what's the best way to show people this is not a secular decline but a cyclical bump and they ought to be in? >> the best way is to look back at 2008-2009 and '10. during the recession which drove our order rates down significantly we were able to use a high percentage of after market revenue stream. today we generate 60% of revenues from after market which is consistent with production rates, not expansion rates. long backlogs. they were sitting on backlogs that were 12 to 14 months. we use it in eight, nine and ten to level out revenues. we can do it again today. we don't see the down side in the market today we saw in 2009. we saw the market flattening for a while. we don't see it dropping like it did then. if we can flatten revenues and increase earnings in a period

where the economy was in deep recession we can perform well during these volatile times. people misunderstand us and the stability we have in our business and misread it as a cyclical when in fact we are far from it. >> i agree with you. people get so skittish they can't think straight. thank you for coming on the show, mike. >> thanks, jim. >> as you heard from the top of my show and now people are jittery and they are not willing to look through the valley. there will be a time when joy does better. can you last through it? if you can, it's probably the time to buy. stay with cramer. >> announcer: coming up, the clock is ticking. call cramer at 800-743-cnbc to fire away at cramer on the lightning round. can he withstand your onslaught of stocks? later, how do your stocks

stack up in a mystifying market? cramer makes sure your portfolio makes the grade on am i diversified? all coming up on "mad money."

>> it is time. it's time for the lightning round. you tell me a stock and i tell you whether to buy or sell. i play this sound and the lightning round is over.

are you ready skeedaddy? time for the lightning round. let's start with scott in texas. scott. >> caller: boo-yah, jim! >> fire it up, boo-yah. what's on your mind? >> caller: thanks for having me on the show. i'm real excited to get your opinion about chesapeake energy. i just bought some. i don't want to get burned. go rangers and boo-yah! >> first, i think oklahoma city takes it in six. nice percentage of the company. that's the best thing i will say about it. here's the deal. why own chesapeake when dvn goes down viciously almost every day and has the best balance sheet, better assets than chesapeake? i totally agree with boone pickens. i don't want to own chesapeake when i can own devon. now i'm going to lorna in california. >> caller: boo-yah, jim! >> boo-yah. >> caller: love the show. >> thank you. >> caller: can you give me your

take on avnet? >> cheap, cheap, cheap. remember the stock when it was low? it's got europe and it's got semiconductors. people will want to throw it away. it's too good of a company. i need to go to jude in new jersey. >> caller: hi, jim. how are you? >> good, partner. how are you? >> caller: okay. listen, i have a quick question for you. what do you think of investing in snapple/dr. pepper? >> dr. pepper is terrific. they have great convenience store sales, a good balance sheet, they generate a lot of cash. buy, buy, buy. now we're going to steve in california. >> caller: this is steve with a costa mesa boo-yah! i'm calling about nabors industry. >> no, terrible. i'm embarrassed. ixnay.

everett in connecticut. >> caller: boo-yah, cramer! >> wow. boo-yah. >> caller: i'm a young investor. i have cystic fibrosis. vertex pharmaceuticals is close to my heart. >> vertex. i want to be hopeful but the revised data didn't give me as much hope. we need a cure for this one. my thoughts go out to you but vertex isn't as good as i first thought. the data wasn't as good. nate in virginia, please. >> caller: boo-yah from arlington, virginia. >> another place i wish i were at. what's going on? >> caller: red hat. is that still the way to play open source? >> mr. whitehurst told a good story over and over again. the company goes down because people get nervous and the stock spikes. then it goes down again.

why? people get nervous. be careful. but i do like it. ted now in arizona. >> caller: i'm honored that you're taking my call. jim, with so much bad news factored in, is walter energy a buy or is it a falling knife? >> people keep trying to rumor it higher. there is too much takeover fluff in there versus earnings. i don't want to touch it. the end of the world guys have big mind share. wow. end of the world. i'm not buying the end of the world stuff. i think there are a couple more days left. john in florida, please. >> caller: good evening, jim. i hope you're well. >> doing okay. how about you? >> caller: i'm good. with the oil stocks speeding down at a 9% dividend what do you think of sdrl? >> this one is overextended because of the dividend. i don't really care for the stock. i like ensco.

every single day stephanie link, you see her on tv. we go over it and say, how much lower can it go? it's going lower but it's better than sdrl. kevin in michigan, please. >> caller: hey, jim. looking at emerson network power, emr. i like the analytics of the stock. you know, and the p/e ratio, good yield. they're trading below the price targets. >> this is such a terrific company. this is what i talk about when i say the industrials are hated. people are so fearful of the next quarter. they are not going to take a stand. at 4%, emerson, i will buy it. it's at 3.5% now. not low enough. that's the conclusion of the lightning round. >> announcer: the lightning round is sponsored by td ameritrade. >> announcer: friday, family therapy for volatile times. and dr. cramer is making house calls.

>> i just want to make you money. >> announcer: mad money, family affair, friday, 6:00 and 11:00 eastern on cnbc. and crowd cheering sfx: sounds of marching band and crowd cheering so, i'm walking down the street, sfx: sounds of marching band and crowd cheering just you know walking, sfx: sounds of marching band and crowd cheering and i found myself in the middle of this parade honoring america's troops. which is actually quite fitting because geico has been serving the military for over 75 years. aawh no, look, i know this is about the troops and not about me. right, but i don't look like that. who can i write a letter to about this? geico. fifteen minutes could save you fifteen percent or more on car insurance. a, the appearance. amber. [ jim ] b, balance. sam adams has malt sweetness, hoppy bitterness. [ jim ] c, complexity. pine notes, grapefruit notes. only believe your own pallet. go taste them. ball. ball. [ crack of bat ] [ male announcer ] hanging out with cal has its benefits... so does taking one a day men's.

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on the go. [ female announcer ] go to the website below and get high speed internet for just $14.95 a month for 12 months with a 1-year price guarantee. that's all the speed you need at a great price. it's an unbelievable deal, so why wait? act now! act now! like he said. ♪ over the last few months, investors learned they just don't have the stomach for the volatility ruling the market of late. boy, they just panicked. last two days alone have seen swings of 1% in either direction. to cure the nauseous feeling you may have on some days, remember when picking stocks the importance of doing your homework. focus on the fundamentals and make sure your eggs aren't in one basket. that's why we play am i diversified? you call or tweet me @jimcramer.

i do the earliest tweet there is. tell me your top five and i tell you if you're diversified. let's start with @tpj99. he tweets, long time listener, first time tweeter. a big l.a. bah, bah, bah, boo-yah! am i diversified? jnj, ed, disney, gold, and joy global. let's take a look at this. i got to tell you. my first take on this is that it is completely diversified and my second take is i really like most of it. i am worried about part of it. let me explain. j & j is doing some restructuring. it's just terrific. bob iger is doing a magnificent job at disney. con ed is utility. doing great.

joy global makes machines to mine and randgold is a miner. but this is coal and that's gold. so i will say not mining. this is gold, this is coal mining. this is drug, entertainment, utility. i'm blessing this portfolio which he entered. lorette. >> caller: hey, jim. i want to say thank you. i'm learning so much from your show and the action alerts e-mails. >> you're too kind. that's the charitable trust stephanie link and i run. what's up? >> caller: i would love to hear your recommendation on how to diversify. these are my top five holdings. exxon, boeing, united tech, royal dutch shell and bp. >> let's go to work here. united technologies, 11% dividend boost after the close.

i really like that. boeing. united tech makes engines but they are diversified and i'm okay. boeing had a really good presentation the other day. aircraft. exxon, largest oil company. uh-oh. i have one, two, three. giant oil companies. bp and shell. royal dutch. i'm going to keep royal dutch. i like the yield. get rid of exxon and add a health care company. why not j & j? i just praised that a second ago. let's be consistent. and get rid of bp. we'll go into something like con-ed which we praised. con ed, jnj. lose a little bit of the yield but you pick up on the diversification. ♪ hallelujah >> now we go to avi in new york. >> caller: big chinatown boo-yah to you. a shout out to mott street. i have apple, new castle, kodiak

oil and gas, at&t, netflix. >> interesting portfolio. we love chinatown. all right. real estate investment trust. that's actually a financial play. i don't really like those. i'll put it out there for the category of diversification. at&t, 52-week high. what's not to like? apple, the greatest technology company of our age. kodiak, i saw an okay report. netflix. is that the same as apple? no. it's its own animal. it ain't kodiak. we have entertainment, oil, financial reit, telco, tech. bingo! way to play the game. "mad money" is back after the break. flowers, bourbon barrels, chocolate, chilies and something called kosmic mother funk all have in common?

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did jamie dimon do well or did he do badly in front of congress today? frankly, i don't care. i only care how well or badly he's doing running jpmorgan and i'm steamed about the mammoth trading loss his firm racked up in london. not all losses are created equal. a firm can make a loan to a client that blows up. that's the cost of doing business. a firm can make a wrong bet on the direction of the market. it's something the bank has every right to do and they do it all the time. i don't like it if the directional bet is out of synch with what the firm is recommending to clients. jpmorgan has been the most prescient firm in the world.

they have stayed away from everything. stocks, bonds, you name it, that's in europe. why was the chief investment office betting positively on europe, even though some say it was a hedge? a hedge against what? intelligence? did the firm's chief investment office believe jpmorgan was telling the wrong thing to clients? maybe. shame on that internal investment management team to bet against the best advice the firm was giving to clients. if jamie dimon paid attention to his own firm's advice he would have shut it down ages ago. the big thing people don't seem to understand because they never worked at one of these institutions is a loss that's a rogue loss, a mistake or it goes against the firm rules isn't something that can be condoned even if it went the firm's way. if it goes against the firm, people who made it should pay. when you made a mistake at goldman sachs you cost the firm

money, made good on it when it was a trading loss. we had a trading loss that didn't fit the rules. i had my pay docked $27,000 for a mistake i made. who else should pay for it? the shareholders? honest mistake. buy up 50 thousand shares instead of the 5,000 the client wanted. the fault was with me. made good. which brings me to the biggest outrage. why i don't care if you think jamie dimon won or lost. sure, he didn't do as badly as others. wow. somebody or somebodies cost the shareholders billions of dollars with a rogue order. they may not have enough money to make good on the error and they don't have the money to make good on the shareholder losses that came from the error that turned out to be mammoth. everyone involved made immense sums working at that bank taking home huge bonuses including the ceo. dimon said there might be clawbacks where money is

returned. however the idea that jamie dimon came out a winner today? who are you kidding? you're in front of congress because you did something wrong. you were wrong when you walked into the hearing and you're wrong when you leave. it really is as simple as that. stay with cramer. how much coffee are you fellows going to need today? three...four cups? [dumbfounded] well, we... doesn't last long does it? listen. 5-hour energy lasts a whole lot of hours. so you can get a lot done without refills. it's packed with b-vitamins and nutrients to make it last. so don't just stand there holding your lattes, boys. make your move. we'll take the 5-hour energy. smart move. 5-hour energy. hours and hours of energy.

hey guys, can i get next? here you go kid. hey aren't you. yep. vogelsong and posey did you check the rating? the rating? yeah, it's simple. always check the rating symbol on the front and read the content descriptor on the back now that's a good call. thanks guys. ahh son, i don't think this game is for us. maybe you should get this one. this kid can play. [female announcer] for more information, visit esrb dot org.

okay. i've got a lot of positive feedback for last night's show about how caroline thinks we could be at a crucial level to be a springboard up. today was bad so i checked in with her again. she said, we held the levels. no need to panic. this is in synch with what i'm thinking. tim collins says so far we are fooling around at the 200-day. so listen, the technicians aren't worried by what happened today.