RealMoney Radio: Air Ball - TheStreet

RealMoney Radio: Air Ball

Cramer says that Boeing's acquisition of Aviall means a play in aviation and aerospace.
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No matter who we want to blame about high oil prices, the takeaway is clear, said Jim Cramer on his

"RealMoney" radio show Monday. Ethanol is the short-term way out of our fuel price jam.

Whether auto companies ever actually make more fuel-efficient vehicles or oil companies invest in alternative energy, oil prices will continue to go higher, Cramer said.

Some analysts say that crude prices could hit $100 a barrel, and Cramer agreed with that assessment, adding that there is evidence that it will be three to five years before any progress is made to bring prices down.

But

The Wall Street Journal

says that the price of $3 a gallon hasn't changed our gas-guzzling ways, and Cramer said that if this is true, it will be a bit longer before the cry for ethanol reaches a fever pitch.

With

Wal-Mart

(WMT) - Get Report

reporting a 6.8% increase in same-store sales, he added that there is evidence that $3-a-gallon gasoline is not slowing down consumer spending.

But once gasoline prices hit $3.50 or $4, "then we'll hear an even louder call for ethanol," he said. And the play here is to own

Archer Daniels Midland

(ADM) - Get Report

before this happens.

ADM's focus is on processing and merchandising agricultural products, which includes turning corn into ethanol, he said. But the stock is up huge right now.

Just as with

Valero

(VLO) - Get Report

and

Conexant

(CNXT) - Get Report

, profit-takers will come in after the company reports its earnings and send the price down, Cramer said.

He recommended buying the stock only after the company reports earnings and the price falls.

Cramer also recommended that listeners look into

AAR

(AIR) - Get Report

, a supplier of products and services for the aviation, aerospace and defense industries.

He pointed out that

Boeing

(BA) - Get Report

has agreed to pay $1.7 billion for the parts company

Aviall

(AVL)

because one of its fastest-growing revenue sources is selling spare parts.

He believes that AAR could be next in line, so he said to lock in the big gains made in Aviall and to plow the money into AAR.

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James J. Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for

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