Making the Right Call

"Speculation is not a sin, if it's done right," Cramer reminded viewers, highlighting three such names that have proven him right.

Cramer said he bet on Sprint Nextel ( S) CEO Dan Hesse back when shares traded at less than half of what they do now. While the stock languished at first, Hesse delivered on his promises, giving shareholders a tremendous return.

Then there's Sunrise Senior Living ( SRZ), a stock Cramer featured on Tuesday's show. Sunrise also has a bankable CEO and a solid business as its core. The turnaround took four years, but shareholders who believed were handsomely rewarded.

Finally, Heckmann ( HEK), another stock Cramer featured and another company that has a bankable CEO with a proven track record. Cramer said all three of these companies show what speculation is really all about.

But compare that to Nokia ( NOK), a stock Cramer is asked about constantly. He said Nokia is the opposite of smart speculation. The company has neither a proven CEO at the helm, nor a core business that investors can rally around. He said at $2 a share it might now be too late to sell Nokia, but it hasn't yet proven itself worthy of buying.

Speculative stocks can go to zero, Cramer reminded viewers, which is why investors must be vigilant and do their homework.

Executive Decision

In the "Executive Decision" segment, Cramer celebrated tonight's kickoff of the National Football League's official season by sitting down with Eric Grubman, vice president of ventures and business operations at the NFL.

Grubman said the NFL is in the fortunate position of having ample access to capital, so the league is not looking towards an initial public offering anytime soon. He said the NFL takes a very long-term approach to its business. Since it's not in need of capital, it's able to focus on what's most important -- making the game exciting for everyone.

When asked about the NFL's business model, Grubman said the league does forecast its revenue and profits, but outside of a major disruption of games, most factors only affect margins, not overall growth. He said the game of football has always been very resilient, regardless of labor disputes and other disruptions.

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