Click here for an archive of Cramer's "Mad Money" recaps.
"Coal cannot be clean," Jim Cramer told viewers of his "Mad Money" TV show Thursday.
When both presidential candidates tout "clean coal" as an answer to the nation's energy problems, they are indulging in "magical thinking," he said.
He said the true promise of "clean coal" is to remove or at least reduce carbon dioxide emissions, but no company has that technology yet. He said such technology is anywhere from three to 10 years away.
Meanwhile, he said, the smarter, more pragmatic approach would be to focus on incremental solutions to make coal cleaner. Specifically, he noted current technologies such as scrubbers and boilers, which can remove much of the sulfur, nitrogen and mercury from coal.
He said the best play on cleaner coal technology is
, a stock which he owns for his charitable trust,
Action Alerts PLUS. The company is a leader in coal fluidization boilers that can remove 95% of the sulfur from coal.
Cramer Interviews Petrohawk Energy CEO
var config = new Array(); config<BRACKET>"videoId"</BRACKET> = 1620576721; config<BRACKET>"playerTag"</BRACKET> = "TSCM Embedded Video Player"; config<BRACKET>"autoStart"</BRACKET> = false; config<BRACKET>"preloadBackColor"</BRACKET> = "#FFFFFF"; config<BRACKET>"useOverlayMenu"</BRACKET> = "false"; config<BRACKET>"width"</BRACKET> = 265; config<BRACKET>"height"</BRACKET> = 255; config<BRACKET>"playerId"</BRACKET> = 1243645856; createExperience(config, 8);
Cramer last interviewed Foster's CEO on May 7. Since then, the stock is up 14%. "It's not done going up," he said. With energy demands expected to grow 40% between 2005 and 2030, Foster is positioned to be a leader in that growth, he noted.
Foster Wheeler also has exposure to the liquefied natural gas business, which is expected to grow from an $8.7 billion business to a $25.4 billion business by 2011. Cramer urged viewers to not believe the "clean" coal hype, but to instead invest in "cleaner" coal with Foster Wheeler.
Cramer: GM and Ford Are Lemons
var config = new Array(); config<BRACKET>"videoId"</BRACKET> = 1612713578; config<BRACKET>"playerTag"</BRACKET> = "TSCM Embedded Video Player"; config<BRACKET>"autoStart"</BRACKET> = false; config<BRACKET>"preloadBackColor"</BRACKET> = "#FFFFFF"; config<BRACKET>"useOverlayMenu"</BRACKET> = "false"; config<BRACKET>"width"</BRACKET> = 265; config<BRACKET>"height"</BRACKET> = 255; config<BRACKET>"playerId"</BRACKET> = 1243645856; createExperience(config, 8);
as as his favorite "cleaner" coal stock and one of his "new tech" companies that are working on the world's biggest problems. "McDermott is perhaps our best hope for cleaner coal," he said.
McDermott's primary business is retrofitting and upgrading coal power plants. "This company's business is about coal, coal, and more coal," he said. "They're in a life or death battle to make it cleaner."
The company makes both scrubbers and boilers for coal plants, with scrubbers accounting for 35% of its backlog, parts and services 30%, boilers 20%, and nuclear power products 15%.
While McDermott does have ways to remove carbon dioxide emissions from coal, the technology it employs removes only between 12% to 15% of the carbon dioxide, far from the "magical" 100% being touted as right around the corner.
But Cramer said that with a new president in the White House, coal standards might finally be implemented that would allow power companies to upgrade their facilities and create a windfall for McDermott.
Cramer said he also likes McDermott's offshore drilling business. The company recently entered into a joint venture in China to build ships used in the support of offshore rigs. That venture, said Cramer, already has a $5.4 billion backlog.
He called McDermott a "twice blessed" company.
Avoid Bank Stocks
In the "Sell Block" segment, Cramer referred to what he called Goldman Sachs' "hit list" of troubled banks, as well as several others, and told investors they simply cannot own them.
He said the arguments made by Goldman offered persuasive reasons not to own these bank stocks.
According to the Goldman report, banks needing additional capital will soon be forced to destroy their stock values in order to stay afloat. The report cited four reasons for this situation, all of which Cramer agreed with.
First, credit losses won't peak until 2009. Second, it's getting harder and harder for banks to raise additional funds. Third, the consensus earnings estimates for many banks are still too high. And finally, the yield curve may be in jeopardy as the Federal Reserve hints at possible interest rate hikes.
Cramer said with all of these pressures weighing on the bank stocks, now is the time to sell.
In particular, Cramer is worried about
Bank of America
Marshal & Iisley
Cramer welcomed Floyd Wilson, chairman, president and CEO of
to the show to discuss his company's outlook.
Wilson explained that drilling for natural gas in oil shale is an expensive and technologically cumbersome process, but the promise of what it can deliver is great. He said that the technology wouldn't be feasible with drastically lower oil prices, but he don't foresee prices ever dropping that far again.
Wilson said that Cramer's views on natural gas have been "spot on." He said the U.S. has an abundance of gas available, adding it's a clean and cheap alternative to foreign oil.
Cramer told viewers to buy on any weakness in the stock.
Cramer was bullish on
He was bearish on
United States Steel
Cramer was bearish on
Gran Tierra Energy
American Capital Strategies
Want more Cramer? Check out Jim's rules and commandments for investing by
For more of Cramer's insights during the Lightning Round, click here
At the time of publication, Cramer was long Foster Wheeler and Wal-Mart.
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."
None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com or CNBC that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the program. Mr. Cramer's past results are not necessarily indicative of future performance. Neither Mr. Cramer, nor TheStreet.com, nor CNBC guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the program. The strategy or investments discussed may fluctuate in price or value and you may get back less than you invested. Before acting on any information contained in the program, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.
Some of the stocks mentioned by Mr. Cramer on "Mad Money" are held in Mr. Cramer's Action Alerts PLUS Portfolio. When that is the case, appropriate disclosure is made on the program and in the "Mad Money" recap available on TheStreet.com. The Action Alerts PLUS Portfolio contains all of Mr. Cramer's personal investments in publicly-traded equity securities only, and does not include any mutual fund holdings or other institutionally managed assets, private equity investments, or his holdings in TheStreet.com, Inc. Since March 2005, the Action Alerts PLUS Portfolio has been held by a Trust, the realized profits from which have been pledged to charity. Mr. Cramer retains full investment discretion with respect to all securities contained in the Trust. Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast.