Cramer's 'Mad Money' Recap: Buy the Bookham

'84 Class Reunion

Cramer welcomed to the show New York Attorney General Eliot Spitzer, the man he believes "cleaned up Wall Street." Cramer and Spitzer were classmates at Harvard Law School, from which both men graduated in 1984.

After acknowledging that he got better grades while Cramer made more money, Spitzer, who is running for New York governor, said his real goal in political office was to "take integrity, accountability, decency and fairness and bring it back to the private sector."

He said as the mutual fund scandals quieted, his office received a memo from one of the most senior executives at a major investment bank that said the firm could have been accurate and honest in its recommendations, but that doing so would have conflicted with its fundamental objective to make money.

"How could they live that way?" he asked the audience. He added that it's a misconception that Wall Street has been struggling in the wake of the investigations launched by the attorney general's office.

Companies, particulary mutual fund firms, that were honest saw enormous capital inflows, he said, while companies that were gaming the system lost money.

"The market is smart," Spitzer said. "It does well by those who play by the rules, and that's how it should work."

Spitzer added that he now wants to bring the principles of transparency, accountability and reform to state government.

To view Cramer's interview with Spitzer, click here.

All Eyes on the Blackboard

"Professor" Cramer told his "class" that they should take a look at Blackboard(BBBB), which he called "the ultimate cut-class-and-stay-in-the-dorm-drinking-with-your-buddies stock."

The company lets students access course syllabi, download PowerPoint presentations and watch lectures over the Internet, Cramer said, making it possible for students to skip class.

Blackboard also lets users download this information to iPods, according to Cramer.

"None of you need me to tell you how useful it can be," he said.

Blackboard doesn't have a lot of analyst coverage, so it's under the radar, Cramer said. He added that the company reports fourth-quarter earnings on Feb. 13 and that he believes it will beat estimates just as it has done in the past.

It'll beat estimates better than anyone on Wall Street, Cramer told his Harvard audience, because its products allow schools to stay on the cutting edge.

And the bonus: Cramer said Blackboard pretty much has no competition.

Classroom Participation

Cramer ended the show with questions from the audience.

One woman asked how much comes down to skill and how much comes down to luck on Wall Street. Cramer said that, for him, it's 50-50.

"And if anyone tells you any different, they're probably lying," he said.

When it comes to dealing emotionally with making bad calls that lose people a lot of money, Cramer said, "I don't want to hide the fact that I feel absolutely horrible."

"These are things that crush me," he said, adding that he has to come out and just say that he screwed up.

Another audience member asked if Cramer has ever been a member of the Communist Party. Cramer replied that even though a portrait of Lenin hung on the wall while he was the editor of the Harvard Crimson, he told his viewers that he thinks Marx was "just dead wrong."

Lightning Round

Cramer was bullish on: Federated Department Stores(FD), Valero (VLO), Zumiez (ZUMZ), Altria(MO), Halliburton(HAL), Coldwater Creek(CWTR), Broadcom(BRCM), Marvell(MRVL), St. Jude Medical(STJ), go down, pull the trigger Starbucks(SBUX), Goldman Sachs(GS), Rediff(REDF) and Electronic Arts(ERTS).

Cramer was bearish on: Giant Industries(GI), Hibbett Sporting Goods(HIBB), Bristol-Myers(BMY), St. Joe(JOE), Liberty Media(L), Pacific Ethanol(PEIX), IBM(IBM) , Coca-Cola (KO), Infosys Technologies(INFY) and Synopsys(SNPS).

For more of Cramer's insights during the Lightning Round, click here.

---

Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by clicking here.

>To order reprints of this article, click here: Reprints