When it comes to investing, technology matters, Jim Cramer told his Mad Money viewers Tuesday. Technology represents over 20% of the S&P 500, and what happens in tech reverberates not only throughout the market, but also the rest of the world.
That's why Cramer is this week attending Dreamforce, the annual Salesforce.com (CRM) gathering in San Francisco, to learn about the latest trends and the industries that are next in line to be disrupted. He's also checking in with companies and executives in Silicon Valley.
Just today we received reports that Amazon (AMZN) is likely to continue its disruption in many different areas, from retail to advertising. We also learned that Square (SQ) continues to dominate small business payments and is now expanding into lending and even payroll. Shares of Square popped 10.8% on the day.
Semiconductors have long led the tech rally higher, but lately pundits are calling a top in Micron Technologies (MU) , a stock Cramer said he still likes.
You need to know which industries are ripe for disruption, Cramer concluded, because having that knowledge will make you a more informed investor.
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Executive Decision: Salesforce
In an "Executive Decision" segment, Cramer again sat down with Mark Benioff, chairman and co-CEO of Salesforce.com, to discuss all of the happenings at this year's Dreamforce.
Benioff said that Dreamforce is not only the industry's largest tech conference, but it's also a family reunion for over 171,000 customers and developers building on their platform. Among the major announcements so far this year were a new partnership with Apple (AAPL) to integrate Siri into the Salesforce ecosystem, and a new, closer relationship with Amazon's Web Services.
Outside of Salesforce, Benioff explained his and his wife's decision to by Time magazine, saying the time-honored media giant is a platform for change that has a positive impact on the world. He said it's a great honor to be the new steward of Time's legacy.
Turning to social issues, Benioff noted that Dreamforce is "inclusive capitalism" and has attendees of every race, gender, religion and orientation. The Salesforce economy will be $1 trillion by 2022, he said, and Dreamforce is the place to be if you want to upgrade your career with new skills.
Finally, Benioff said the old notion that the "business of business is business" no longer holds true in the new world. "The business of business is taking care of all stakeholders," he said, and trust is now the highest value you must attain. Companies like Facebook (FB) have lost people's trust, he said, and the company is paying the price for it.
Executive Decision: Dropbox
For an "Executive Decision" segment, Cramer spoke with Drew Houston, CEO of Dropbox (DBX) , the cloud storage provider that's seen its shares fall 16.5% over the past three months as investors were less than impressed with the company's earnings.
Houston said that Dropbox has been able to build a base of over 500 million users by simply building a product that people love. Many people discover Dropbox at home, he said, then bring the service to work, where teams become departments and eventually entire companies using the Dropbox.
Houston added that Dropbox solves important problems for people, which has provided them with a stable business that works over the short and long term. The company also has great partners with Microsoft (MSFT) , Google (GOOGL) and Salesforce.
While technology can often be distracting and overwhelming, Dropbox aims to make things simpler and make life easier for their customers.
Executive Decision: FireEye
In his next "Executive Decision" segment, Cramer also spoke with Kevin Mandia, CEO of cybersecurity company, FireEye (FEYE) , which saw its shares rise 4% today and are up 13.3% for 2018.
Mandia said that FireEye has multiple ways to make money and that model sometimes confuses investors. But the company's mission remains the same, respond to every attack that matters and do their best to detect, protect and prevent as many attacks as they can.
Mandia said that every attack is in some way geopolitically motivated and his company is seeing increased attacks from North Korea, Iran and Russia. Attackers are increasingly being supported by these countries. Iran, in particular, is posing an increased threat to our nation.
Attackers are increasingly going after softer targets, Mandia added, using the ripple effect to allow small attacks to balloon into larger ones. With many attacks, even the attackers don't know how many systems they'll infect until it begins to spread.
Finally, when asked about bitcoin, Mandia said that many attacks on bitcoin use the currency's anonymity against it, making it a prime target for thieves.
Over on Real Money, Cramer talks about the leadership changes in tech. Get more of his insights with a free trial subscription to Real Money.
In his "No-Huddle Offense" segment, Cramer said sooner or later, every investor makes a fool of themselves. That was certainly the case earlier this year, when interest rates topped 3% and investors piled into the bank stocks, only to be foiled as rates reversed course, taking the bank stocks with them.
A similar story played out in the oil stocks, as crude topped $70 a barrel earlier this year, only to be slammed back down in July and August. Oil's return to $70 a barrel has left investors gun-shy, despite this move being driven by a hardline stance on Iran and crumbling exports from Venezuela.
With oil exploration spending not picking up, this time could be for real, Cramer said, as it could with the banks, which are finally benefiting from rising rates that will last.
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