Q:
I just wanted to
know your
thoughts on the
homebuilder
sector, i.e.,
TOLL?... Are we
at a point where
we should be
looking to
purchase, or
should we be
holding off?
Jim:
I've been
recommending
PHLX Housing Sector Index
(^HGX)
calls. I
don't like to
recommend
options.
The reason why
is that the HGX
has really
bottomed...
that's the
housing index...
Today, we saw Standard Pacific Corp.
(SPF)
report numbers,
with
cancellation
rates lower than
previous.
That's the same
thing we saw
from TOL.
This housing
business is
bottoming.
It's going to
take until June
30th of next
year, but the
bottoming
process has
started.
na
na
na
Mad Mail
Lehman Brothers
and the Fed
Q:
During your
famous rant a
year or so ago,
you implored the
Fed to open
their window.
They did not,
and that in part
led to the
failure of Bear
Stearns.
After Bear's
collapse, the
Fed did open the
window to the
brokers and
dealers.
If opening the
window was such
a panacea, then
why did access
to the "darn Fed
window" as you
ranted, not save
Lehman?
Did Lehman just
not take
advantage of the
opportunity that
the Fed provided
them?
Jim:
I believe they
didn't. I
think they felt
they were in
much better
shape. A
lot of the
stories are
going to come
out about how
they were
holding out for
a higher price.
They didn't want
to panic
anybody.
They were
totally
delusional.
I don't know
what really
happened there,
other than the
fact that
were... have got
to be one of the
worst-managed
things I've ever
seen, other than
Bear Stearns.
Quite
embarrassing,
and they should
have used the
window... you're
absolutely
right...
na
na
na
Mad Mail
Merrill Lynch
Excessive
Severance
Payouts
Q:
I am outraged
that John Thain
and Thomas
Montag from
Merrill may
receive
exorbitant
payouts totally
over $47 million
if they are
forced to leave
or given lesser
roles at
Bank of America (BAC).
This impacts my
shares in BAC
and they should
not be allowed
to run a company
into the ground
and then get
compensation for
it. How
can we fight
back? I am
only a small
shareholder, but
hearing this
just boils my
blood. Can
you please
address this on
your show?
Jim:
I'm conflicted
on this myself.
John Thain, many
would argue...
if he did not
make that move
with BAC,
Merrill would
have gone under.
The short
sellers were
targeting
Merrill.
They wanted to
drive it to
$2-3. They
would have done
it, and Merrill
would have
failed, just
like Lehman.
I think
Merrill's a much
stronger firm
than Lehman was,
but I've seen
what the short
sellers do.
Now, do I find
that kind of
payout obscene?
Yeah. I
find it
embarrassing.
I look at it and
I say, come on
guys, how could
you pay yourself
that much... but
it's a
formula...
BAC agreed to it
I guess, and
it's quite
embarrassing,
and I think
these rich
people ought to
start
recognizing that
America is
getting sick of
this, okay...
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Final Segment 2
Final Segment
2
Title:
'CEO Interview'
'No
Reservations?'
. . . .
.
Featured
Stock(s):
Interview with Clarence Otis, CEO
Darden Restaurants (DRI)
See DRI's official
investor relations' site
here.
See the Yahoo!
Finance profile for
DRI
here.
After this segment, you
can see Jim's
Sudden:Death picks
here...
. . . .
.
Jim: Happier
days are here again...
That's my thesis for many
companies... certainly not the
financials... even after the
dramatic decline we had
yesterday... It's still
true, even with all the
turmoil in the banks, the
brokers and insurers, because
it has nothing to do with it.
The price of oil's falling
through the floor...
Gasoline is right behind it...
I think it's going to go
through $3 a gallon. And
every other commodity,
including food, is getting
slightly cheaper too...
That's got to be good for
someone right?...
Someone with no connection to
the problems at Lehman or AIG.
Back on September 10th, I
recommended
Darden Restaurants (DRI),
parent company of the Olive
Garden and Red Lobster... not
to mention Longhorn
Steakhouse, Capital Grille,
Bahama Breeze and Seasons
52... as a
happier-days-are-here-again
play...
I said more people would be
going out to eat... I
thought DRI's earnings would
be in-line...
better-than-expected going
forward... not necessarily
this quarter, because we
already knew what this quarter
was going to be... and I
expected input costs to go
down...
So, therefore, I thought that
DRI would benefit from the
fact that so many other casual
dining chains are going out of
business... think
Bennigan's... or closing
restaurants... while DRI was
still opening new ones.
I said it could survive and
thrive... because they've got
great scale. And, not
unlike
Panera Bread Co.
(PNRA),
up nicely today...
McDonald's
(MCD*)
up nicely today... I
think that DRI is just a
matter of time before it
starts ramping...
Today, the company just
reported 58 cents a share.
They had told us, at the end
of August, that it would be
between 57 and 59. Hey,
they haven't given up on
themselves... they bought 2.1
million shares this quarter.
I think they've got a great
story to tell, and I think
they're a great place to eat.
That's why I want to bring on
Darden Restaurants (DRI)'s
chairman and CEO, and a friend
of the show, Clarence Otis...
Welcome back to Mad Money!...
. . . .
.
The Bottom Line!:
Guys look... This is the kind
of long-term story I am urging you to
get involved with, as gasoline comes
down... the expectations are lower.
They delivered a great number... they
deliver great food. And, I've got
to tell you, it's not all bad out
there... I say we've got to keep
looking for bull markets wherever we can
find them.
. . . .
.
■
Stock Snapshots - Includes
all stocks mentioned above
■
Jim
Cramer's
rating on
this stock
STOCK
SYMBOL
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price
that
day
Opening
price
next
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each)
Go to the SUDDEN:DEATH
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tonight's show stocks
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Symbol keys:
A Charitable Trust stock.
- An asterisk next to a
stock symbol indicates that
Jim mentioned it is a stock
that he manages within
his
charitable trust portfolio.
You can see the complete
portfolio
of stocks
here >>
Thumbs up - indicates
he would buy the stock or,
at the very least, not sell
the stock. We do our
best to interpret Jim's
opinion on stocks, as we
think it is indicated by his
comments during the show.
Please read his comments to
decide for yourself.
Thumbs down -
indicates he has said not to
buy or to sell the stock,
based on his comments
We do our best to interpret
Jim's opinion on stocks, as
we think it is indicated by
his comments during the
show. Please read his
comments to decide for
yourself.
Back up the truck -
indicated by Jim, when he
says the stock is so good,
that he would do a
'mon-back' on the stock...
In other words, this is the
sound someone would say to a
truck driver, "Come on
back... " as he is "backing
up the truck" to load up on
his cargo. Translation
for buying stocks:
This recommendation by Jim
indicates that, after you do
your own
homework on the stock,
you should feel comfortable
loading up on it, as it is
in a good position to be
bought at this point.
Stumped. - Of the
2,000+ stocks that Jim
Cramer has in his head, for
which he has an informed
opinion, he sometimes comes
across a caller with a stock
he does not know well enough
to opine on... He then
indicates he is stumped and
will have to come back to
it, after he does some
homework of his own on
the stock. This
usually occurs during the
Lightning Round, when Jim
does not know in advance who
is calling, or what their
stock question is about.
Definitions of key phrases
used by Jim, known as
"Cramerisms":
Definition: 'Pull the
trigger' is Jim's phrase for making
the decision at that point to trade -
either to 'buy' or
to 'sell' (although he
usually uses the phrase for
buying), as if to say you
should feel comfortable
enough to make the final
decision without looking
back...
Definition: 'Ring
the Register' is Jim's phrase for
selling a stock, and making
it a final sale, that you
should not look back on.
Put it behind you.
Definition:'Let It Come In' indicates how you
may wait for it to pull back, or have the
stock price come down briefly, as your
chance (after letting it come in) to buy
the rest of your position (i.e., total
number of shares you own in that stock).
Definition:'backing it up'
or 'doing a 'mon-back' is Jim's
phrase for the metaphor of backing up a
truck to load up on a stock by buying
it. 'Mon-back is short for the
imaginary worker saying, 'Come on
back...' as the truck is backing up to
receive its load... Notice that we use
the little truck icon to indicate where
Jim has mentioned this.
Translation for buying
stocks: This
recommendation by Jim
indicates that, after you do
your own
homework on the stock,
you should feel comfortable
loading up on it, as it is
in a good position to be
bought at this point.
See more
"Cramerisms" & other
financial phrases
here >>
Helpful Websites:
See the stocks currently
known to be in Jim Cramer's
Charitable Trust at:
Stock Homework 101:
This is an excellent
upcoming site that provides
resources and links to help
you do that homework that
Jim Cramer recommends after
hearing his suggestions...
FastMoneyRecap:
This site will be a quick
summary of recommendations
made by the great Fast Money
TV show crew, that will
offer you a unique service,
to compare their picks to
Jim Cramer's past comments
about those stocks.
