This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stock Under $10 that he thinks could potentially double or triple in the next 6 to 12-months. See what he's trading today with a 14-day FREE pass.

Jim Cramer: The Fulcrum of Consumer Spending

NEW YORK (Real Money) -- You know what was lost in the shuffle of all of the reports last night? How about spending? Specifically, how much are consumers worldwide spending on their devices, particularly when it comes to their expensive cell phones? How about: How much are advertisers spending online, and what results are they are getting? Those were the twin takeaways from Apple (AAPL) and Facebook (FB), and I think they are still just beginning to materialize.

We talk a lot about how there are regions of the global economy that are waxing and waning, but given the secular growth in consumer spend and advertising spend online, this remains the fastest-growing sector in the world. You just don't get the kind of growth that Apple and Facebook are getting without spending by the Chinese consumer, the Russian consumer, the Brazilian consumer, the Indonesian consumer, the European consumer and the U.S. consumer.

The implications of this then flow right back to the advertisers -- who recognize that there is such a wholesale shift in habits of consumers, and where they spend their time, that they have to follow the eyeballs away from every other form of media right to the computer. Plus, the sheer numbers of credit cards on file makes it so that the cell phone truly is going to be the fulcrum of all consumer activity. Facebook dismissed the payments issue as too nascent, but Apple highlighted it because it has 800 million credit cards.

That's what came out as you stepped back from the minutiae of all the calls. The shift in "consumer time and attention" is the essence of last night's calls, to quote Facebook chief financial officer Sheryl Sandberg in that company's triumphant conference call. It's 4.5 hours per day watching television vs. 5.75 hours watching mostly the cellphone.

It is the consumption pattern worldwide that is so exciting. You upgrade your phone to faster phone lines so you can watch Facebook six out of seven days, as more than 50% of the people do -- thank you, Mark Zuckerberg. And, because of the strong user graphics and terrific interface courtesy of Apple, you read good ads, chiefly from the news feeds, and then you buy goods using the payments system that are advertised directly and through brand forms. It is a seamless world, and it is a world driven by a consumer who wants to spend and has the money to do so, particularly as it pertains to the young consumers worldwide.

It is also clear that Facebook's deal to buy WhatsApp, at least to me, will be as successful as Instagram has been -- which, like Google's (GOOG) YouTube, still isn't even being monetized. When you think that Instagram in two years has gone from 22 million users to 200 million, you can tell that user engagement globally is endemic, if not pandemic!

Device to apps to ads. The Apple-to-Facebook ecosystem is based on consumer wealth and where it is going. It is going right to these companies and, to another extent, Google, for search and watch.

I think, in the midst of this downturn, we've forgotten that this is what's happening.

May these quarterly numbers remind us what's really going on in the world's economy: banking, talking, spending, watching, communicating, showing. These are at the heart of the surge we are seeing, and it is still early, or at least earlier than we what we thought had been possible at this seemingly late date.

At the time of publication, Action Alerts PLUS, which Cramer co-manages as a charitable trust, was long AAPL, FB and GOOG.

Editor's Note: This article was originally published at 8:09 a.m. EST on Real Money on April 24.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
DOW 17,007.01 -32.48 -0.19%
S&P 500 1,989.76 -2.61 -0.13%
NASDAQ 4,538.1670 +6.0630 0.13%

Our Tweets

Brokerage Partners

Top Rated Stocks Top Rated Funds Top Rated ETFs