good weekend. 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 you, but to educate and teach you. so call me at 1-800-743-cnbc or tweet me @jimcramer. anybody who has a high school diploma has almost certainly taken a course in chemistry, a course in geometry, some physics, probably, and a host of classes, and you can graduate from college speaking three languages and have a deep understanding of quantum physics. but you know one thing they don't teach you in high school? financial literacy.

learn nothing about personal financial planning or how to balance a darned checkbook, let alone how to invest your money wisely. money is not talked about in education. it's like the third rail of the whole educational system. and that's why i'm on a constant mission to teach you about every aspect of managing your money, so you'll be able to become a better investor, both when it comes to retirement investing and playing around with what i call your discretionary mad money portfolio. which is a big reason why i wrote "get rich carefully" to begin with. most of you even, really, even if you don't own any individual stocks directly, you probably have some kind of exposure to the stock market, probably a 401(k) plan where you keep the bulk of your retirement funds, which is why i want to take a moment to talk about retirement. for those of you who have been living in a cave for the last 40 years, 401(k) plans are the main way americans save. they're offered by your employer, and among some of the

for those of you who are about to fall asleep or change the channel, because the whole idea of saving for retirement puts you to sleep, hear me out. because you need to know this stuff. and i'm going to tell you some things that you won't hear from the so-called experts. this show's different. at this point, it's pretty much become conventional wisdom that you have to invest in your 401(k). that only an idiot would not contribute to a 401(k) plan. a lot of experts will even tell you to max out your 401(k) if you max out enough money for that to be feasible. the maximum contribution tends to be going up over time from $17,500 in 2014 or $18,000 in 2015. and those contributions come from your pre-tax income. however, i'm not one of those people who think you should max out your 401(k). i'm not someone who is going to sing the praises of 401(k) and tell you it's the key to financial salvation. because the truth is, 401(k)

>> boo! >> but a couple of really great features and a lot of bad ones, too. and those bad features will eat away at your returns year after year, sometimes through fees that are almost totally hidden from you, that actually are quite upsetting to me. so let me lay out the good, bad, and ugly of 401(k) plans and tell you whether it makes sense to contribute more money to your 401(k) or put that cash to a better use somewhere else. first the good. the best thing about a 401(k) is it's a tax-deferred investment vehicle. you never pay a penny on gains of profits you make, which allows your money to compound year after year, compounding, fantastic, decade after decade. totally tax free until you decide to start making withdrawals. regular viewers of this show and readers of my books know i'm a huge believer in the power of compounding. let me give you an example here. suppose you're 30 years old and you start investing $5,000 a year to your 401(k). and you're not paying any income on that pretax income. if you choose your investments wisely, you should be able to

on average. over course of the next 30 years, you'll be contributing $150,000 to your 401(k) plan. but because that money is able to compound year after year without any capital gains taxes, by the time you're 60, that $5,000-per-year pre-tax income, well, that could be worth over $511,000. if you had to pay taxes on dividends and capital gains, that number would be much -- it would be a lot lower. perhaps as much as $110,000 lower. that's how important compounding is. and avoiding -- well, let's say the tax deferred nature of the thing. you only ever have to pay taxes on your 401(k) money once, and that's when you decide to withdraw it. that's taxed as ordinary income, and since most of you are retired, most of you will end up paying a lower rate than if you were taxed on it when you first earned it. that's one major reason to like 401(k) plans. the second, many, but not all, employers will match or partially max your contributions.

your employer may throw in 50 cents. that's free money. you never want to walk away from free money. but if you don't get money, i think it's a much less compelling option. but there are a lot of things about a 401(k) plan that can be really bad. which is why if, again, you don't get a match from your employer, i believe it's a better idea to save for retirement via the individual retirement account, or i.r.a., which has the same exact tax-favored status of a 401(k). you can only contribute $5,500 a year to your i.r.a. or $6,500 if you're over 50, but when you change jobs, you can roll over all of your money from your 401(k) into an i.r.a. why is it a better option? first of all, 401(k) plans vary widely from company to company. some give you a terrific range of choices, but some give you a

options. sometimes you only get to choose between a dozen, a couple dozen at most different mutual funds. so for those of you can't pick your own stocks in your 401(k), my number one rule, before you contribute money to your 401(k) plan, you have to make sure it gives you the option to put your cash into something that's actually worth investing in. if you can't pick your own stocks in a 401(k), you want a nice low-expense index fund that mimics the s&p 500. however, if your 401(k) doesn't even offer that, shame on you -- well, shame on your company -- then go with a self-directed i.r.a. from a full-service discount program. i'm not talking about fidelity, so you can have control over your money. one more negative. within a 401(k), when you invest in a mutual fund, you have to pay that mutual fund's fees. this is really important. but your 401(k) administrator, the company -- the people your employer hires to run these plans, they will also charge fees. >> boo! >> meaning that all of the money

great deal of that can be clawed back by these fees. have you ever looked at your statement and wonder why your 401(k) holdings aren't increasing in value why they should be, fees are probably the reason. where does all of this leave us? here's my bottom line on retirement investing. the company you work for offers an employer match for your 401(k) contributions, then you want to put money into your 401(k) until that match is maxed out. no reason to pass up on free money. and after that, put any additional retirement savings into an i.r.a. but if there's no employer match or if there's an employer match, but your 401(k) doesn't give you any options that are worth investing in, with you would do better to skip the 401(k) and go straight to an i.r.a. immediately. debora in california, debora? >> reporter: hi, jim, thanks for taking my call. >> quite welcome. >> caller: i have a two-part question regarding the value of listening to a company's earnings conference call. >> okay. >> caller: the first part is, how can we decide what we want to do, in other words, what

the earnings report since the stock frequently will behave in a contradictory fashion to the report? for example, a company can report good earnings, but guide lower on the revenue and earnings going forward and the stock will go up. the second -- where you might think it should go down, right? the second part of my question is, i'm on the west coast, so the calls frequently are at 7:00 and 8:00 a.m. eastern time, so for me, the value of listening to the call is diminished, because i'm not going to get up at 4:00 or 5:00 a.m. to listen to it. so i'm not really going to take any action on that. >> okay, here's the solution to this, debora. you have no gun to your head, unlike the hedge funds, you can listen at your leisure. i'm not trying to get anybody into a quarter, to buy a stock ahead of a quarter, if i can avoid it. what you want to do is take a longer-term view in the comfort of your home without any noise,

it. go to yahoo! finance, get some of the research, street.com, cnbc, get some research, max the expectations with what was said, take a longer-term view. that's the advantage of the individual investor. you don't have to play that day. doug in nevada. doug! >> caller: bountiful boo-yah, mr. k.. >> okay. >> caller: yeah, my question is, i have a 401, currently substantial. would it be advisable for me to change that to a self-directed i.r.a.? >> okay, well, what matters is the match. if you have -- if the employer's matching, no. you want to get the max -- you want to get the max match, so to speak, then after that, yes. or -- but if it's six of one or half a dozen of the other and the funds aren't that good that you're allowed to be in your

choose a self-directed i.r.a. let he help take control of your financial future. when it comes to retirement, if your company matches your contribution to 401(k), then max that out. that's really important. but if you don't get an employer match or don't have investable options, go straight to the i.r.a. on mad tonight, you just got your diploma, now what? and two busy to invest in individual stocks? that's fine. i'll help you put your money behind the next best things. plus, there are many roads to health investment. let's chart your course. stick with cramer. >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter. have a question? tweet kramer, #madtweets. send jim an e-mail to madmoney@cnbc.com or give us a call at 1-800-743-cnbc.

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stick to the financial elements of cramer regime. because it drives me nuts that we don't teach our young people about how to handle money. would it be so crazy if you had to take a class in personal finance before you graduate from high school? i think it should be mandatory. like those awkward health classes they make everyone take that can get a little graphic at times. sadly, i'm nobody's dictator, but i do control what we talk about on this show. so can i just take a moment to speak some words that we all believe, but very rarely get to say in conversation? look, money is important. it's really important. and caring about the state of your finances does not make you some kind of superficial bourgeoise monster. for example, let's say you've got a really lousy credit score and you want to get married. congratulations! you've just inflicted your horrible credit on your new spouse. now, neither you nor your partner will be able to qualify for a loan to buy a car or a home or perhaps even just get a darned credit card. these things matter in life.

happiness, but i've often found that piece of cliched conventional wisdom to be dubious at best, because being broke is a major buzzkill, as i know firsthand from living in my ford fairmont. so what the heck should young people do with their money? first and foremost and always, you need to invest. that's the only way you're going to be able to achieve financial freedom. and by freedom, what i mean is, living a life where you're not totally 100% dependent on your paycheck. i'm always thrilled when i see members of the younger demographic were taking an active hand in managing their own money. too many people start saving and investing way too late. that makes their lives a lot more difficult than they need to be. but i also know many young people feel like they have all the time in the world, many more start investing before they're

fact, better things for them to be doing stuff with their money. so we've got to really drill down on this. it's why i'm going to give you three lessons. and a caveat for all of those who are recently out of college. let's start with the caveat. before you can start investing, you need to pay off your credit card debt. this is something i've mentioned before. but it's especially true for younger people, potential since credit card companies have gotten really aggressive about offering credit to college students, no matter how much money you rack up in the stock market, if you're carrying a balance on your credit cards, then it's going to eat into your returns. i know this myself firsthand. and long-term, the interest on those credit cards will probably be greater than the profits you can make from investing, at least on a percentage basis. so just pay your darned credit card balance in full every month. auto mate it with your credit card company if you're worried. you'll be tempted not to. i can't defeat that credit card debt, no matter how many great stock ideas i have on the show. now let's get to my three lessons for young investors. first, this is really for all the young people who have recently graduated and actually for everyone out there,

you need to save money. but i recognize that not everyone has an inherent predisposition to save. we can't all be natural cheapskates. and i also acknowledge that telling you to save over and over won't necessarily do any good. however, the stock market is a great way to trick yourself into saving a part of your paycheck that you might otherwise spend. investing in stocks can actually be a lot of fun. we try that on the show, right? we try to do some entertainment within the teaching, whereas leaving money in a savings account or a certificate of deposit just feels like, well, kind of joyless for a lot of people, not to mention the fact that the returns are so small that they're basically yes, indeed, i'll use the word, meaningless. plus, if you invest your savings in the market, it will be a lot easier to resist the temptation to spend that money on things that you might not need, because it will be sitting in stocks that you'll like, and you'll have to sell those stocks to get your money back, and there's a natural predilection to not sell once you buy. not only is this a terrific way to trick yourself into saving, but also has the added advantage to being the smartest place to

perspective right now. yes, traditional savings vehicles like money market funds, see those rates, check them every week, cds, check those every week, they give you hardly any return at all. it's a waste to put your savings in them when that cash could be making you a lot more money by owning stocks in a brokerage cap and working with your money, get your hands dirty with your money. this is a much more targeted piece of advice. while you're still young, you can afford to take a lot more risk than an old foegy like myself. in other words, when you're in your 20s, you can get away with riskier, some would say more reckless strategies, like owning more speculative, single-digit stocks where the potential upside could be huge, but so is the potential downside, or playing with options or generally being a lot more aggressive with your money. why is that? it's not because young people are naturally better speculators, not at all. it's simply because when you make a mistake in your 20s with your money, you have your whole rest of your life to fix it. you can afford to buy more high-risk stocks and end up losing your money when you're young, because you've got 40-odd

so you've got to take those risks. older investors, you've got to be more cautious. the closer you get to retirement, the more conservative your investing strategy has to be. more bonds, more high-yielding stocks, fewer speculative stocks trading in the single digits. but if you're in your 20s, you should invest like a young person, not an old person. forget about bonds, people, please, i'm begging you. there's no reason for someone in their 20s to have bond exposure when that money could be invested in stocks, where it will most likely end up consistently making you a high return year after year. so young people, i want you to take this advice to heart, especially because i suspect that the recent college grads most likely to invest in the market are also the ones who are the most responsible, the most prudent about their money. and prudence is great when you're putting together a budget to live with, within your means, or deciding how much of your paycheck to save every monthly. but for young investors, being too prudent is actually being reckless. 20-somethings, live a little, at least in your stock portfolios, take some risks swb forget about bonds for the next days. play around with some

biotech companies with a lot of potential, even if they blow up on you and go all the way to zero, you have your whole life to make that money back. and it's never too early to start investing for retirement. use your 401(k) if your job has one, especially put some money in a roth i.r.a., which is ideal for young investors. investing is a great way to trick yourself into saving money. you might otherwise spend that money. beyond that, remember when you're young, you can afford to take a lot more risks in your portfolio. and it's never too soon to start contributing to your 401(k) or i.r.a., especially if that i.r.a. is a roth. let's go to mike in tennessee. mike, mike, mike? >> caller: hey, jim, how you doing? love your show. we watch it all the time. >> thank you. thank you. >> caller: my question is, a few episodes ago, you said that you did not like buying a stock if the peg ratio got above 2? >> right. >> caller: and i'm wondering

ratios as a sell signal? and if you do, how high would you let it go before you pull the trigger and sell the stock? >> when it's more than two times the growth rate, i get nervous. there are some stocks that don't trade on earnings, and you have to be careful. like a colt stock, but the typical stock, if it trades for lower -- you know -- lower than two times that rate of growth, i'm fine with it. but it is a red flag once it gets higher. a penny saved is a penny earned! investing is a great way to trick yourself into saving money. it's never too soon to contribute to your i.r.a. or 401(k). (cell phone rings)

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we live in a world where you have more choices about where to invest your money than ever before. a virtual infinity of etfs, mutual funds, you name it. but more choice isn't always better. sometimes having more options just makes it impossible to decide which ones are right and which ones are wrong for you. and you have never had more options when it comes to picking exchange-traded funds and mutual funds than you do right now. they're everywhere. at this point, there's so many different kinds of etfs that it can make your head spin.

many of the sector-based etfs, the ones that let you buy and sell an entire group like the banks, the home builders, i hate the way they've been warping the way the whole stock market trades. that's something you can find out more about in "get rich carefully." and if you're in these etfs, i have to urge you to find out about them. but the important thing is this. you have all sorts of etfs and mutual funds out there, and they can all advertise. the companies that run these and one of the biggest mistakes you can make as an individual investor is to give it to them with a few significant exceptions. unfortunately, this is also one of the most common money mistakes out there. in fact, most people in this country simply equate investing with putting their money in mutual funds. some 80 million people or basically half the households in america have exposures to mutual funds. many of you don't have a choice. a lot of 401(k) plans don't give you an option. so i think all else being equal

invest for retirement for you. what exactly is so bad about most mutual funds? why am i railing against something that's an institution in this country? simple. if you're investing in mutual funds, you're most likely well, to put it delicately, you're, uh, getting hosed. now, i don't want to paint with too broad a brush here. there are some worthwhile mutual funds and i'll tell you how to find them in a minute. but first, you need to understand the problem with the mutual fund model. my main beef here is that with actively managed mutual funds, mutual funds where there are people deciding which stocks or other stocks to buy and sell, we've got some problems. unlike hedge funds, mutual fund managers don't get paid for delivering performance. they collect fees from their investors, people like you, and the amount of money they make depends entirely on the size of their assets under management, aum, we call it, which means their biggest incentive is not necessarily to do well, something that good performance can really help with, but what

investors. salespeople for their funds. and that's part of the reason why in study after study, year after year, it has been shown that the vast majority of actively managed mutual funds underperform their bench marks, like the s&p 500. in other words, if you invest in an actively managed fund for large capitalization in u.s. stocks, then its performance will most likely fall short of the s&p 500. make matters worse, even though actively managed funds consistently underperform the market, they have some of the highest fees in the business. how do you like that? they don't do as well as the benchmark and they charge more. so even if your fund does manage to beat its benchmarks, odds are good you'll end up with an overperforming investment instead of being in a simple index fund that mirrors the s&p 500. of course, there are some active funds out there with fabulous managers that can deliver consistent results. but when a mutual fund delivers such great results for so long,

person, with they'll stop accepting new investments, put their foot down. because at a certain point, when a fund becomes too big, it becomes incredibly difficult to beat the market. so as a general rule, if you're going to invest in mutual funds, you don't want to be in an actively managed one, the fees are too high, and the evidence that the bulk of them underperform is too staggering to keep going that way. you know that i think your best strategy is to manage your own portfolio of stocks, but for those of you who don't have the time to research individual companies or if your 401(k) plan won't let you own them, let me tell you the smart way to invest in mutual funds. if you want, you can write this down. a cheap low-cost index fund that mirrors the market as a whole. one that mimics the s&p 500. index funds have ultra-low fees and with an s&p index fund, you've got a vehicle that will let you participate in the strength of stock market,

picking individual stocks. this may sound like a real simple solution. don't overthink it. the whole point of putting your money in a fund is to save you the time and money required to manage your own stocks. that's why i think it's insane when people start owning multiple mutual funds. by its nature, a mutual fund should be diversitied. there's really know reason for home gamers like you to have any exposure to them. if you're going to take the time to try to play individual sectors, that time would really be much better spent picking individual stocks. as for etfs, in most cases, these vehicles are for trading, not investing, so i don't like them. many etfs rebalance every day and that can take a real told on any kind of long-term performance, their not set up for long-term performance. there are some exceptions, the gld, the etf i like to play for gold. but in general, if you're not a pro and not managing a portfolio and not day trading every single day, then you probably shouldn't be fooling around with those etfs either. here's the bottom line. at the end of the day, i think a cheap s&p 500 index fund is the

manage your money. better than the vast bulk of actively managed mutual funds. but an index fund owns everything, the good, the bad, and the ugly. and if you do have the time, i think you can beat the performance of an index fund by picking stocks yourself, which is the entire reason i do this show every night. if you don't have the time, though, then don't overthink it. just one cheap s&p index fund is, indeed, the best way to go. mary in maryland. mary? >> caller: boo-yah, jim! >> mm-hmm. >> caller: jim, i started listening to you a while back. then i started buying stocks on your advice. >> thank you. >> now i'm looking at my portfolio here, and jim, jim, my eyes have seen the glory! so i want to get a little fancier and perhaps buy some china stocks. however, i'm curious about adrs

currency exchange rates. so can you educramer us on adrs and exchange rate exposure? >> sure. we've got the bad republic going on overseas, but here's the way i look at it. if you want to own individual stocks and the businesses are good, i don't care where they are. i don't care about the currency, if the business is that great, the stock will go higher. but understand if you're buying an adr and it's a european country, for instance, and the euro is being weakened by central bank issues, you will not do well, even if the stock does well. all things being equal, and you don't have a country or continent trying to debase their currency, i'm fine with it. but if they are, you've got to stay away and stay in the good old u.s. of a., which i think is a real smart way to invest. matthew? >> caller: baa b-b-b- boo-yah, jim. >> back at you. >> caller: i'm 23 years old, recent college grad and new to the workforce and just started

realizing time is on my side, i want to go for an aggressive allocation to take on risk, but i'm unsure of how to do that exactly. so i want to get your suggestions for someone starting out to the timing investing. how would you go about -- >> well, with i think that you want to have the fastest young growth stocks, and those are -- tend to be found in technology sector, but also, of course, in biotech. now, don't go too crazy. i'm willing to have one of two stocks of companies that aren't making money, no more than that. but those are the most fertile area. junior growth stocks, companies that are worth $1 billion or less. a lot of them are too small to talk about. one of those two. these are all fine. you can do those, because if you lose money, you've got the rest of your life to make it back. sorry, not so much mutual love here. picking stocks is still the best way to manage your money, but if you don't have time, just please, please, please, go with

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let me tell you about whether it make sense for you to use a regular 401(k) or an i.r.a., or for you to go with a roth, which is a term i'm sure you've heard countless times, but may not understand. i know i've talked about the benefits of using an individual retirement account, or i.r.a. for short, or a 401(k) plan to invest for retirement. i'm not going to beat a dead horse here, but this is a subject i get a ton of questions about. should i put my money in a roth account or a regular one? why don't we start with a roth i.r.a.? i think that aside from the earned income tax credit, the roth i.r.a. may be the single greatest thing our government that has done for low-income families since the end of the war on poverty, which at best ended in a draw, poverty possibly winning. i've told you all about how a regular i.r.a. lets you take pre-tax income, invest it, and then your gains can compound year after year, decade after decade, totally tax-free, until you decide to withdraw that money when you retire.

with a roth, you make contributions with after-tax income. so, in other words, unlike a regular i.r.a., putting money into a roth won't decrease your tax bill. on the other hand, though, once your money is in a roth i.r.a., you will never pay taxes on it again. as long as your cash remains in your account, you don't pay capital gains tax or dividend tax. and when you withdraw it, which you can do without penalty after the age of 59 1/2, you don't pay any incomes tax on your withdrawals. this is fabulous. in other words, with a roth, you pay taxes now so yo don't have pay any income tax 30 or 40 years from now when you retire. there's one more positive point about a roth. you can withdraw the money you've invested, not your gains, just what you've contributed, and you won't get hit with a penalty. which is what happens if you try to withdraw money from a regular i.r.a. that's very different from a regular i.r.a., where you don't pay any taxes now, and your gains don't get taxed within the

withdrawing the money, every penny you take out is taxed as ordinary income, which can be a very high rate. which means when you're trying to decide between a roth i.r.a. and a 401(k) or a regular i.r.a. or a 401(k), you're basically deciding whether it makes more sense to pay income tax now with a roth or wait to pay income tax once you've retired with a regular account. in other words, you have to figure out whether you'll be the in the higher tax bracket after you've retired or a lower one. this is a complicated question and has a lot to do with the specifics of your situation, your career, and how old you are. a quick rule of thumb, for anyone whose marginal tax rate is 25% or less, which is most of america, i think you ought to go with a roth. better to take the hit up front than allow your roth i.r.a. to compound tax free for the rest of your life. for those of you who don't have the time to pick your own diversified portfolio, the smartest thing you can do is park your money in a low-cost index fund that mirrors the s&p 500. as you get older, you can add

actually retire, stocks should make up the majority of your retirement investments. i know i've said this before, but i'll keep repeating it until they take me off the air, because it's so necessary, but contrary to conventional wisdom. i want stocks, not bonds, until later. how about a roth 401(k)? this works just like a roth i.r.a., meaning you make contributions with after-tax income and never pay taxes on that money again, except since it's a 401(k) plan, it has a much higher contribution limit than an i.r.a. for example, the government says the 401(k) contribution limit for 2015 is $14,000, which i.r.a. contributions are capped a mere $5,500. and unlike a roth i.r.a., a roth 401(k) doesn't have any kind of income cap. no matter how much money you earn, you can take advantage of one of these, as long as your employer gives you the option. if you believe that taxes inexorably headed higher over the course of your life, then a roth 401(k) where you pay your taxes now and pay nothing in the

even if you're making a lot of money in the present. but i think that belief's mistaken. for those of you young people who have only become politically conscience under the obama administration, it may seem like there's no way to stop the tide of hire taxes, but history says different and i believe we can close the deficit without substantially raising taxes. about as political as i'm going to get on this show. but at the end of the day, this is beyond our control and therefore beyond our ability to predict. the bottom line, the lower your present income, the lower your taxes. a roth 401(k) or a roth i.r.a. lets you pay those low rates now and never worry about taxes again for your retirement money. so the less you make, the more likely it is that a roth is for you. it's that simple. and when you're saving for retirement, don't worry about what could go catastrophic wrong 30 or 40 years in the future. just worry about making the best choices right now. "mad money" is back after the break.gree gave women a motion-activated wristband to understand how much they move,...

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if you want to get a real read on the industrial economy, you could do a lot worse than checking in with honeywell, the incredibly well-run company with its fingers in all sorts of businesses, including climate control system, turbo equipment for cars and truck engines, as well as many more things. we got a chance to chat with dave cody, the chairman and ceo of honeywell, you saw the bulk of the interview yesterday, but we got to go on what's known as a walk-and-talk with cody where he showcased some of honeywell's intriguing new products. i want you to take a look. >> this is the water leak detector we were talking about. this is one of the top ten at the consumer electronics show. and this can actually send a message to your iphone, telling you that you've got a problem. >> amount of gallons saved?

in the country? >> you know, that i don't know. this is more a case of preventing accidents. so instead of having a flooding in your house or and you don't know about it for three days because it's happening down in the cellar or happening at a vacation home, this way you know. and you can react to it right away. >> i had a burst pipe at my beach house, dave. it's going to cost me a fortune, frozen pipe, had no idea about it. >> there you go. >> this is what i need. i'll tell my insurance company they should cut my bill if i get this. >> this gets us into metering for gas, water, and electricity. and the software that connects them all. this one may not look like much, but think of it as an industrial cash register for gas. so already we think a $5 billion acquisition, something good, accretive in 2016? >> it will be accretive this year, yes. >> numbers for a lot of the analysts yet. >> this allows you to purify industrial waste water using bacteria that are naturally

any refinery would use this, but it's going to be able to go beyond that. so we're just starting to roll this out there. this is based on designs that we use for refineries today. we do this with 70% less footprint than other -- >> you were going to say, it's sustainability, in some companies, just to be able to track young people, they have to be able to -- come on! you think apple doesn't have sustainability in its new building? they can't get the great computer scientists unless they do. >> unless they do, excellent. well, we'll do very well there. now, you want to watch the super bowl next year while you're on the plane? >> yes, i do! and so does everybody else on my plane. >> you want ka-band. which is, we call it jet wave. it's something we do within mr sat. here's why it's significant, versus what you see today -- >> legacy is go go or via sat. >> we found that consumers a a more important than wi-fi access than they are bathrooms.

expensive and 100 times faster. >> okay, i'll go go. this will also allow you to do stuff for pilots. so, for example, on weather, i can an hour or two hours ahead of you, because they fly in a line, telling you what's happening up here, so i can start to route my planes differently. when combined with our 3-d weather radar, which we're the only guys that have, allows you to avoid storms, avoid hail damage. >> what were they doing before? just kind of winging it? >> no, what they would do is -- so we'll say that they had information of a storm, instead of say, cutting it a little more closely, they'd have to do this wide berth. >> yes. >> so a lot of fuel. this one is pretty neat. we showed you a smaller version last year. these things are selling unbelievably well in china. >> china? >> air purifiers. >> oh, yeah, well, no kidding. >> and the stuff works great. we sell them online -- >> this is not the usual, someone bought your nameplate. you're making this? >> this is an all-honeywell

made in china. >> okay, so that -- because i know -- >> sold in china, made in china. >> you again said in your last quarter that you expect china up again. there are no companies that know that except for you. why is that? >> well, there's two reasons, i think. one is, we try to stay pretty close to the market generally and have a market-based product, but the other one is, you've heard me talking for about five years about becoming the chinese competitor. >> yes. and i think there's still too many multi-nationals who look at their competition as other multi-nationals. when in reality, your competition is the local guy in china. they're the number two economy in the world. >> right. >> and starting to view them as your competitor and acting that way sounds simple, but there's a huge mind-set change that has to happen to do that. and we've been working on this for a while. this one we can't resist, because this is a difference between a chinese firefighter and an american firefighter, beyond just size, as we say, but there's actually a difference in how they approach fires.

this huey, the honeywell user experience, you have to design for the local market. chinese firefighters stay outside and push the water in, whereas american firefighters tend to go into the building, as needed. so there's much different equipment that this requires. and when you look at this mask, what we're able to do with this mask is there's actually a heads-up display that shows, that tells them their own biometrics, so they have a sense for that, along with like what kind of air do they have in their scuba tank, which we also make. but this allows them to operate a lot more safely and it transmits all of that biometric and other data outside, so that somebody knows what's going on. >> another thing you've taught me is not something in the people's -- >> no, nor do they want to. you don't want them saving money, right? >> and every year, you've also said that things get tougher. >> yes. >> it's not like they've gotten easier. >> well, safety regulations, as

a -- >> worldwide? >> society, yeah, regulations tend to go up, because you realize, you don't want people dying or getting hurt. this one, of course, we can't resist showing you a jet yen. this htf-7000 is part of our growth story as a company. >> this is more of a growth business than the 7h7? >> oh, yeah, think of it of 7, 800 up to 8,000 pounds of thrust. think of it for biz jet applications. >> and one of the things you have said over and over, the metric is the number of flying hours. >> at the end of the day, what really matters is are people flying? and if you take a look that over a long period of time, it's pretty darned consistent. people are flying more every year. only when you hit a bad recession year does that change and then it goes right back on the path again. and with the world becoming more wealthy, meaning families more disperse, businesses more global, travel is going to continue.

>> how many of the things we see here did not exist three years ago? >> oh, almost all the stuff you saw in there. >> and it's all additive to earnings? >> oh, yeah, yeah, this is all stuff that -- we don't measure share, generally, because i find people focusing on the denominator instead of the numerator. what you want them doing is figuring out how to grow sales faster than your industry and faster than your competition and that's what we focus on. >> i guess that's why you always say, why after 14 years are people surprised. because you keep running and keep issuing new products and those are what generates that organic growth that you're most proud of if >> exactly. we call it seed planting and we're constantly focused on seed planting. >> dave cody, congratulations on what looks like another suite of products and another unbelievable year. >> not so bad. >> fantastic job.

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holy cow. we've got to get to some of your tweets that you've been sending me @jimcramer #madtweets, including ones that are very nice and smart. here we go. ken egan tweets, i love you, jim. i love you, kenneth egan 23. how's that? it's requited in my book. some people call me jack tatum, no, i'm a sweet guy. @jwgreen-wants to know, why care about short-term hit if you have long-term investment strategy? amen. how many times have i said, i like xyz stock, and it goes down that day and people want to burn me in effigy, or burn me in scalding oil.

think a little longer term. here we have @diego who wants to know, aside from your own, what other books should home investors have under their belts to help them trade/manage better. #getaplan. "one up on wall street" and "beat the street," peter lynch. they're available on amazon. "one up on wall street" and "beat the street." you might want to look at david darst's book. he taught me a lot at goldman sachs and then moved on. but david darst's books are very good. up next, @drhoy84 tweets, do uh ever sleep or did one of your biotechs provide you with a clones to assist? no, i don't sleep. now btw, which i think stands for by the way, i am now

motto or kwyo. cleaned my portfolio this week. yolo. you only live once, so i totally agree with you! here's @crabo44. i'm in the market because of you, sir. just give all the haters a big boo-yah! keep teaching us what they want to grow, jim. let me give you a little heads up. i love the haters. i wouldn't be doing this if it weren't for them. i would have gotten out years ago. i'm a spiteful, driven guy to the haters, and everyone in my personal life knows that. so haters, you're why i'm in this game! congratulations! and stick with cramer! pet moments are beautiful, unless you have allergies. then your eyes may see it differently. only flonase is approved to relieve both itchy, watery eyes and congestion. no other nasal allergy spray can say that. when we breathe in allergens our bodies react by over producing six key inflammatory substances that cause our symptoms. most allergy pills only control one substance.

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