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NEW YORK ( TheStreet) -- It's a fact, the vast majority of the stocks in the S&P 500 benefit from lower oil prices, Jim Cramer proclaimed to his Mad Money viewers Tuesday. Yet, money managers choose to make things complicated, Cramer continued, finding all sorts of reasons to dislike the continued great news.
Imagine, if you will, that the U.S. government gave everyone a $2,000 tax rebate check, Cramer posited. That would be seen as terrific news, right? Yet, when the average American consumer fills their gas tank twice a week at today's dramatically lower gas prices, which also equates to a $2,000 savings, that's seen as bad news? The tax rebate is a one-time event, lower gas prices is an annuity that keeps on giving, Cramer continued.
While the oil producers themselves may not benefit from continued lower prices, there are many sectors of our economy that do. The transports certainly appreciate lower fuel prices, as do the utilities, which use a ton of oil and gas. Consumer packaged goods are huge consumers of energy as well.
Then there are the consumer-related sectors. Restaurants do better when consumers have more money in their pockets, as do the retailers. Cramer said when you add all of these positives together, they far outweigh the pain being felt by the energy stocks.
The big money managers are overthinking things, Cramer concluded, but the smart money is buying, not selling, our newfound windfall.
Off the Charts
In the "Off The Charts" segment, Cramer went head to head with colleague Carolyn Boroden over the charts of Twitter (TWTR - Get Report) , Facebook (FB - Get Report) and Google (GOOGL - Get Report) , three stocks Cramer owns for his charitable trust, Action Alerts PLUS.
Looking at a daily chart of Twitter, Boroden noted a strong floor of support between $38.41 and $40.24 a share. Below those levels, the next floors don't appear until $29 and $22 a share. If Twitter can hold above $40.24, Boroden felt shares could rally to as high as $60. However, strong buy triggers have not yet appeared and she was not yet sure which way the stock would turn.
As for Facebook, Boroden felt this was a buyable pullback, with support between $71.77 and $72.69 a share. Below that, the next floor was close by at $70.32, which represented Facebook's October lows. As for upside, Boroden felt $83 to $86 a share was possible.
Finally, Boroden saw Google's floor between $495 and $509 a share and felt shares could chug higher to between $633 and $679 a share if they could pull through short-term resistance between $570 and $586 a share, making her cautious in the short term.
Cramer said he was in agreement with Boroden's analysis, saying that Facebook had the best growth while Google had the cheapest growth. As for Twitter, Cramer said the company has a great product but needs new leadership.
GoPro or Go Away?
Is GoPro (GPRO - Get Report) the ultimate video ecosystem or just an overpriced gadget fad? That's the question Cramer set out to answer. Shares of GoPro are up 180% since the company's initial public offering and trade at 68 times earnings after the company reported a blowout quarter.
Cramer said the bulls loved that GoPro beat the expectations for 38% earnings growth and even the whisper number of 40% growth, posting instead a staggering 46% growth with guidance for over 50% next year. The bulls also appreciated the expanding gross margins, which now hit 44%.
But over the long term, Cramer said, the bears fear GoPro's pending lockup expiration on Dec. 23, which will raise the float from 20 million shares to 120 million shares overnight. That's serious downside pressure as insiders attempt to lock in their gains.
Trading at 68 times earnings with a 37% growth rate, Cramer said GoPro is indeed expensive. That explains why 40% of the company's shares are currently sold short. But GoPro is more than a gadget, Cramer argued, and its community is not only publishing tons of new content to YouTube every day but watching tons of content as well.
Cramer said he's leery of the stock in the short term but would consider it on any significant pullback, especially after the lockup expiration selling has finished next month.
Executive Decision: Tim Timken
For his "Executive Decision" segment, Cramer sat down with Tim Timken, chairman, president and CEO of TimkenSteel (TMST - Get Report) , which just delivered a 3-cents-a-share earnings beat on a 24% rise in revenue -- news that sent shares lower.
Timken said there was lots of good news this quarter, including the company's solid guidance and stock repurchase program. Timken noted that oil drilling remains strong, as does business in the automotive sector. Even Timken's base industrial business, including railcars, is seeing moderate growth.
When asked about the trend towards "light-weighting," or swapping heavy steel components for lighter-weight aluminum ones, Timken said many of the components the company makes are highly differentiated and are not possible to replicate using other materials.
Cramer said Timken makes a lot more than just pipes for oil rigs and the market is selling the company short by sending shares lower with the rest of the oil patch.
No Huddle Offense
In his "No Huddle Offense" segment, Cramer answered the question of what's really causing the decline in oil.
Cramer said that contrary to popular belief, there is no international conspiracy to send oil prices lower to hamper the burgeoning U.S. drilling revolution. In reality, Saudi Arabia just doesn't produce enough oil to make that happen.
Instead, Cramer said there's a perfect storm of events, not the least of which are a slowing global economy and U.S. oil production -- now the highest it has been since 1986. We've reached a tipping point in the U.S., Cramer continued, with our all-time oil production highs of 10 million barrels a day now well within reach.
There's simply too much oil being drilled in our country, Cramer concluded. With the world using less oil, prices have to adjust downward.
To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.
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-- Written by Scott Rutt in Washington, D.C.
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