Sneak Preview: Mining Potential for Transformation

Editor's note: This is a special sneak preview of Jim Cramer's just-released book, Jim Cramer's Stay Mad for Life: Get Rich, Stay Rich (Make Your Kids Even Richer). Look for more sneak previews every day, and get your free copy with your annual subscription to Action Alerts PLUS; click here for details. Catch Cramer in person at his last book signing event: Saturday, Jan. 12, at 1 p.m. in Westbury, Long Island's Costco.

Missed the first sneak previews? Read the book intro and the rules of getting and staying rich: Rule 1, Rule 2, Rule 3, Rule 4 and Rule 5. Know what pros do right and amateurs do wrong: Part 1, Part 2, Part 3, Part 4 and Part 5. Learn the five mini-bull markets that will stampede for years, starting with aerospace and defense, agriculture, oil and oil service, minerals and mining and infrastructure.

Minerals and Mining

For years, the minerals and mining group of stocks was perhaps the worst group of stocks to own. They were never "investable" because they frequently needed financing; they were poorly run; and any time the U.S. economy sneezed, this group got pneumonia. I can't tell you how much money I lost at one time or another on Amax, Asarco, and Phelps Dodge(PD), to name some terrible stocks of yesteryear. These were serial cutters and omitters of dividends that would then catch a few years of warmth and institute new dividends and buybacks, only to suspend them again the moment the U.S. economy slipped into neutral.

Those days are over, totally over. We always hear about the pull of China, how China is going to reshape the world and become a global power -- with India not far behind it -- and investors -- pros and amateurs alike -- just can't stop looking for ways to play these markets. Stop looking: minerals and mining are the way to play them.

Let me give you one quick anecdote about how this group has ceased to be levered to the U.S. economy and a Federal Reserve Bank that cares far too much about inflation and not enough about growth. Ten years ago, the United States used 30 percent of the world's copper and China used 10 percent. Now China uses 30 percent of the world's copper and the United States uses 10 percent.