Fed Gets It Right: Cramer's 'Mad Money' Recap (Wednesday 7/29/20)

Jim Cramer says he's tired of hearing we're in a bubble. Some stocks are going up because they are posting good earnings, where we are in the comeback cycle, and their forecasts.
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You can call this market a bubble if you want, Jim Cramer told his Mad Money viewers Wednesday, but the Federal Reserve is being prudent to keep interest rates low and keep our economy afloat.

Cramer said he's sick and tired of hearing from the bears who say that the only reason stocks are hitting new highs is because the Fed is artificially inflating the market. He said many of these "bears" are money managers who missed the rally and are hoping that stocks will go lower, so they can buy more. Don't be fooled by money managers talking their book, Cramer warned.

The Fed is right to keep rates low with double-digit unemployment, Cramer said. They're not propping up the entire market, they're being very prudent to help the industries that need it the most. Without quick action by the Fed and the Treasury, countless cruise lines, airlines and retailers would have already gone bankrupt. The bears have no interest in saving these companies, Cramer added, they would have been happy to short them to zero. But the Fed understands how vital these industries are for jobs and our economy overall.

As for our trillion-dollar tech giants, Cramer said they deserve their success for their relentless innovation. Investors are simply rewarding companies that have huge growth and a positive outlook for the future. It's not Amazon's  (AMZN) - Get Report fault they suddenly became the best place to shop during a pandemic. But thankfully, they were ready.

Stocks are higher because great companies are posting great earnings, Cramer concluded, and that has little to do with the Federal Reserve.

Cramer and the AAP team are looking at everything from earnings and tariffs to the Federal Reserve. Find out what they're telling their investment club members and get in on the conversation with a free trial subscription to Action Alerts Plus.

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Executive Decision: DexCom

In his first "Executive Decision" segment, Cramer spoke with Kevin Sayer, chairman, president and CEO of DexCom  (DXCM) - Get Report, the medical device maker for diabetics that delivered strong earnings, even with the pandemic.

Sayer said the DexCom has become an important fixture in the diabetic community, helping patients to gather the information they need to make decisions about their care. Diabetes is a lifelong condition, he said, that needs to be managed early on to ensure the most positive outcomes.

Sayer added that Type 2 diabetes is a prevalent condition in America and more patients are discovering they have it. That's why DexCom is committed to meeting patients where they are, whether that's at their doctor, their local pharmacy or at a hospital. They're working closely with insurance providers to help more patients achieve zero copays for their insulin and supplies.

DexCom has also been working with the healthcare system throughout the COVID-19 pandemic, modifying their products to interface with hospital systems so healthcare providers can monitor the glucose levels of COVID patients without having to enter the room.

Cramer said DexCom's shares should be higher.

American Success in the Global Market

In an increasingly industrialized world, America needs companies to act as national champions, Cramer told viewers. His nominees? Apple  (AAPL) - Get Report, Amazon, Facebook  (FB) - Get Report, Alphabet  (GOOGL) - Get Report and Microsoft  (MSFT) - Get Report.

While Congress grills the execs of Apple, Amazon, Alphabet and Facebook this week and frets over their concentration of power, Cramer sought to reframe the discussion in a different light. He asked, "what does America do really well at the moment?" We used to be a leader in manufacturing, but no longer. We used to lead in aerospace. We're still strong in drugs and medical technologies, but those products are price controlled throughout most of the globe.

That leaves technology as America's shining star and one of the best things our country has going for it. Cramer said Amazon does have a lot of power, but it also helps keep prices low. Google still owns search, but every year search becomes a little less relevant. Facebook has many problems, but at the moment, TikTok seems the immediate threat. And then there's Apple, which does take 30% of apps on the AppStore, but it's also created over two million jobs and generates billions of dollars for developers.

America's tech industry should be celebrated, not investigated, Cramer said. 

Executive Decision: Martin Marietta Materials

For his second "Executive Decision" segment, Cramer also spoke with Ward Nye, CEO of Martin Marietta Materials  (MLM) - Get Report, which delivered a 45-cents-a-share earnings beat but saw its shares plummet 7% after the company suspended forward-looking guidance.

Nye said Martin Marietta just completed its most profitable half-year ever, and infrastructure remains strong throughout most of the country. He said when it comes to materials, the states and municipalities in which you operate matters a lot, and that's why Martin Marietta has a strong presence in North Carolina, Colorado, Texas and Florida.

Nye noted that Texas has $7.1 billion worth of infrastructure projects in the pipeline, while Florida is planning $9 billion in additional road projects.

Martin Marietta is also a stealth e-commerce story, Nye added. He said warehouses and data centers both require large amounts of aggregates and materials and Martin Marietta serves all of the hottest areas of the country where both of these are in high demand.

Executive Decision: Aphria

For his final "Executive Decision" segment, Cramer checked in Irwin Simon, chairman and CEO of Aphria  (APHA) - Get Report, the Canadian-based cannabis producer that's close to profitability.

Simon, formerly the CEO of Hain Celestial  (HAIN) - Get Report, said that Aphria has 1.6 million square feet of growing space and more than 1,000 employees. The company operates seven different brands in Canada, where cannabis is legal, and has operations in Germany and Italy as well.

Simon explained that Aphria's strategy is to perfect their operations in Canada so that they'll be ready when cannabis is legalized in the U.S., something that could happen soon if the Democrats take the November elections. He said legalizing cannabis would give states much needed revenue to help replace money lost due to COVID-19.

Lightning Round

Here's what Jim Cramer had to say about some of the stocks that callers offered up during the Mad Money Lightning Round Wednesday evening:

BioCryst Pharmaceuticals  (BCRX) - Get Report: "No, let's up our game with Regeneron Pharmaceuticals  (REGN) - Get Report or Eli Lilly  (LLY) - Get Report."

Lumber Liquidators  (LL) - Get Report: "You can buy this one and it will go higher."

Jumia Technologies  (JMIA) - Get Report: "No, you want Amazon and Alibaba  (BABA) - Get Report."

Nio  (NIO) - Get Report: "I only recommend one Chinese stock, Alibaba."

GTT Communications  (GTT) - Get Report: "If you want 5G, I'll give you Skyworks Solutions  (SWKS) - Get Report, Marvell Technology  (MRVL) - Get Report and Qorvo  (QRVO) - Get Report."

HCA Healthcare  (HCA) - Get Report: "I think HCA is undervalued."

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At the time of publication, Cramer's Action Alerts PLUS had a position in AAPL, AMZN FB, GOOGL, MSFT.