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Two days ago, people woke up and saw that the futures were down and that Europe looked ugly. "Everyone thought we would be crushed," as all indicators said the
would be plunging, Jim Cramer said on his "Mad Money" TV show Thursday.
Yet, today the Dow rallies, he said.
Why is the Dow Jones Industrial Average acting crazy and irrational? "It's not all that prone to financial pressure," Cramer explained. "It is not exposed to the three crisis points in the system: the financials, the brokers and the homebuilders."
A lot of the companies on this exchange are still "great" buys. In fact, Cramer said he's sticking with his 14,548-point target for the Dow. While some may think that's crazy, remember, Cramer was off by only a few points last year.
Take a look at what's in the Dow, he suggested. People will see that only four Dow stocks are levered to the problems of the market and have the possibility of being rumored down by the bears:
, the last two of which Cramer owns for his charitable trust,
Action Alerts PLUS.
And out of these four, JPMorgan and Citigroup are the only ones directly related to the mortgage worries. There's no denying that their estimates are going to get hurt, Cramer said.
Four out of 30 is not bad, he said. Meanwhile, the other stocks on the Dow have balance sheets that are "beautiful."
, which Cramer also owns for his charitable trust, seem to be working, to name a few, he said.
In addition, Cramer believes that
have the tools to weather this market.
"With that list of stocks, how is it any wonder that the Dow didn't get crushed yesterday like it was supposed to, or get annihilated today like it was supposed to," he said.
Free to Be CME
A stock that works whether the market is up or down 100 points at the bell is
, Cramer told viewers.
This company, which operates the Chicago Mercantile Exchange and Chicago Board of Trade, is profiting from the ups and downs of the market every time people make a bet, he said.
Plus, it's "new and improved" coming off the merger with the CBOT, Cramer said.
The newly merged company is so great, the Justice Department should never have let it go through. Now, with the merger complete, CME has the potential to pretty much charge whatever it wants.
Not only does the merger allow CME to raise its fees on the increasing trades, but the future cash flow with the merger should go through the roof, Cramer said. Plus, as the company mostly has fixed costs, and as it makes more money, most of it should go to the bottom line, he said.
Moreover, the stock may look expensive, but its earnings estimates are too low, Cramer said. CME is cheap, has accelerating revenue growth and is the "perfect play" on the volatility of the market, he said.
Hair There and Everywhere
Cramer devoted his entire "Sell Block" segment to explaining why people are selling companies that had better-than-expected earnings.
Buffalo Wild Wings
all had better-than-expected quarters, but they all got "crushed."
"Bar and hair are two tricks of the trade," he said. "They explain the eternal disconnect between the companies and their stocks."
One of the reasons these companies fell in a span of two days is because they all beat their quarterly estimates three times. "They've set the bar higher," Cramer said. When they reported a fourth time, simply being better than expected was not good enough.
In addition, "in each case we got, what they call on Wall Street, hair on the quarter," he continued. What this means, Cramer explained, is that the quarter wasn't clean, there was something wrong with it.
For MasterCard, the "hair" was domestic slowing, while in General Cable's case it was an extremely poor outlook, he said. Buffalo Wild Wings, Cramer went on, had what is known as lumpy same-store sales.
"I was a hog in all of these cases. I should have said to sell them all," he said. "You can't count on me to tell you when to sell; you can't count on me not to be a hog."
The right time to sell these stocks was Tuesday, but people should still take them off the table, if they haven't already done so, Cramer said.
Gregory Milzcik, chairman and CEO of
, joined Cramer on his show.
Aerospace is "incredibly strong, and we're in the sweet spot of the current cycle," Milzcik said. "We focus on difficult-to-manufacture parts but are also positioned great on high-volume, high-growth platforms, like that of the 787."
When Cramer asked why analysts are disappointed with the company's distribution segment, Milzcik said they are not necessarily disappointed but want to see success. Milzcik said Barnes Group has plans set for sales and margin growth.
Also, it has developed and expanded in Europe, "where markets are booming right now," he said.
Cramer said he got Barnes through
stockpickr.com. "Let the downgrades come, and then I would buy some," he said. "This stock's just way too cheap when it gets down to $20."
To view Cramer's interview with Gregory Milzcik, please click here.
During the "Sudden Death" round, Cramer was bullish on
He was bearish on
( NWA) and
Cramer was bullish on
Public Service Enterprise
Cramer was bearish on
For more of Cramer's insights during the Lightning Round, click here
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At the time of publication, Cramer was long Citigroup, Hewlett-Packard and AIG.
Stockpickr is a wholly owned subsidiary of TheStreet.com.
Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."
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