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Politics is hurting your stocks, Jim Cramer proclaimed to his Mad Money viewers Monday. This year's increasingly angry presidential race is making investors less certain about the future, which in turn makes them less likely to take risks or own stocks at all.
How bad are things getting? It caught the eye of famed billionaire Warren Buffett, where in his annual letter to shareholders he said that our government is getting in the way of "investable progress." That sentiment was echoed by General Electric (GE) CEO Jeff Immelt who, in an open letter, said that the relationship between government and business is the worst he's ever seen, and our policies are only slowing growth or stopping it altogether.
The political backdrop lowers the PE ratios of the entire market, Cramer explained, and whether you're talking biotechs, pharmaceuticals, infrastructure, oil or tech, our government is becoming increasingly vocal with its anti-business rhetoric.
Cramer recalled that President Eisenhower once said the job of the government was to promote American business. But while that ideal seems to be slipping further from reach, it is only obscuring, and not eliminating, opportunities in the stock market. Great investments are still out there, he concluded. They're just getting harder to find and taking longer to realize.
Off the Charts
In his "Off the Charts" segment, Cramer once again checked in again with colleague Carolyn Boroden to see where she sees the markets heading next. Viewers will recall that Boroden correctly predicted on Jan. 26 that the rally had no staying power. Indeed, the markets peaked on Feb. 1 and subsequently bottomed on Feb. 11, where Boroden then called a "tradable low."
Boroden now see multiple Fibonacci timing cycles converging on the weekly S&P 500 chart, signaling that the market's trajectory could soon change for the better, especially if the markets are able to stage a rally tomorrow. Continued declines tomorrow would signal that the markets are entering a trading range cycle.
Turning to a chart of the Nasdaq 100, Boroden saw a reverse head-and-shoulders pattern, which would be bullish, but only if the average can hold above the 1,810 level.
Gambling on Wynn?
After roaring back 40% in just the past two weeks, is there still time to get into Wynn Resorts (WYNN) , the casino operator that has seen a remarkable rise and fall over the past decade? Cramer took a closer look.
Shares of Wynn were on fire from the depths of the recession in 2009 to their peak of $242 in 2014. But that red-hot growth came to an abrupt halt when the Chinese government put the brakes on corruption in its gambling mecca of Macau. With a sudden lack of VIP clientele, Wynn saw its growth dry up almost overnight, sending shares down 80% from its peak in the months that followed.
But Cramer noted that Macau, and Wynn, are now on the mend as the Chinese economy works through its lows. Trading at 19 times earnings, Wynn is attractive, Cramer said, but he also cautioned that after the stock's monster move, investors will need to wait for a pullback to get a better entry point.
Executive Decision: Aneel Bhusri
For his "Executive Decision" segment, Cramer once again spoke with Aneel Bhusri, co-founder and CEO of Workday (WDAY) , which just reported a 1-cent-a-share earnings miss. Shares of Workday are down 24% for the year.
Bhusri explained that despite the miss on the bottom line, business at Workday remains strong and the company is seeing its highest win rate in the past eight quarters. He said Workday continues to focus on growth in this exceptional "land grab" market or the next generation of enterprise cloud services.
When asked for more details, Bhusri said large companies continue to replace their legacy HR systems with more efficient cloud-based ones and in some cases are even replacing cloud-based systems for Workday's better cloud offerings. The cloud offers value, he said, which is something all companies crave.
Bhusri did admit, however, that Workday needs to do a better job educating Wall Street about the company, especially in reference to the seasonality in the business.
Cramer said in a industry like Workday's, investor need to focus on revenue growth and big customer wins and not on the bottom line.
No Huddle Offense
In his "No Huddle Offense" segment, Cramer said unlike many annual reports, the one offered by Warren Buffett is a treasure trove of terrific investing advice, and best of all it's totally free.
Cramer reiterated his buy on Buffett's Berkshire Hathaway (BRK.b) but also called out many highlights gleaned from Buffett's diverse portfolio of investments that include insurance, rails, energy, chemicals and more.
For example, Buffett remains pleased with Bank of America (BAC) , a stock Cramer owns for his charitable trust, Action Alerts PLUS. He also was upbeat on Kraft Heinz (KHC) , another Action Alerts PLUS holding.
Cramer said Buffett's take on the rails also made him bullish on the likes of Union Pacific (UNP ) and CSX (CSX) as both of those railroads have room to improve, even in a downward business environment.
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