← Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer
Mad Money w/ Jim Cramer 12/3/24
00:43:55
Listen to Jim Cramer’s personal guide through the confusing jungle of Wall Street investing, navigating through opportunities and pitfalls with one goal in mind - to help you make money. Mad Money Disclaimer
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Jim Cramer
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Commercial Voice
Before investing, consider the fund's investment objectives.
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Caller
Risks, charges and expenses. Visit ssga.com for perspectives containing this and other information.
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Commercial Voice
Read it carefully. DIA Subject to risks similar to those.
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Caller
Of stocks all ATs are subject to risk, including possible loss of principal Alps Distributors Inc.
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Commercial Voice
Distributor My mission is simple to make you money. I'm here to level the playing field for all investors. There's always a bull market somewhere and I promise to help you find it. Bad money starts hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramer. Other people make friends. I'm just trying to make you a little money. My job is not just to entertain, but dedicate, to teach about days like today. So call me 1-800-743- CNBC. Tweet me. Im Kramer. The other day we got some potentially devastating news that the US Was putting on new sanctions to the Chinese when it came to high tech goods. Then almost immediately, the Chinese fired back with what's being called a mineral ban, blocking the US from getting key metals like gallium germanium that we need for electric vehicle batteries. Semiconductors. Holy cow. Are things finally spinning out of control? I heard it all day, nonstop. That they are. But if so, how is it possible the market just yawns. Dow dipping 76 points, S&P inching up 0.05% and the Nasdaq epicenter advancing.4% to a new record high. How can this be? How can the market be so wrong about this drastic trade war between the world's first and second largest economies? Or maybe, just maybe, does the market or something we don't. As we get closer to change in Washington, I think we have to start thinking on a dual track toward our nemesis, the prc. One track punitive and the other track gloriously benign. At least if you own stocks. First, let's just point out that the sanctions announced by our government yesterday were unexpected, even if you misleadingly heard that they weren't. When I first heard about the scope of them, I gulped. As my Chapel trust owns a bunch of semis that I thought would be crushed by the punishment our country was meting out to China. Supposedly our government was cracking down on all sorts of semiconductor capital equipment companies and the makers of high bandwidth memory. I figured there goes the semi neighborhood. I had them all going down. Applied Materials, Lamb Research. They should be obliterated. They make the best equipment have to use China exposure. I figured Micron, our biggest high bandwidth memory company, would just get clogged. I assumed AMD and Nvidia would get hit too. Because whenever our government hits China with trade sanctions, well, you know what happens then. But what did occur? Every one of those stocks soared. The whole semiconductor capital equipment sector outperformed the market. Micron's been on a real jag here. After being a very difficult stock doing, AMD rallied hard. Arguably, that stock should have come down because arch rival intel just ousted their failed CEO. And any new CEO might be a threat to AMD's new dominance in video rally too. Although it wasn't specifically singled out by the Commerce Department, so maybe it should have been. Fine, regardless. In fact, after reading the entire announcement entitled whoa, close your eyes and then don't, but don't fall asleep, Commerce strengthens export controls to restrict China's capability to produce advanced semiconductors for military applications. It's very clear that the Commerce Department was incredibly and smartly targeted. Its approach, no meat acts. They looked at what the People's Liberation army could use against us and made the wise decision to block those very specific products, but nothing else. Commerce Secretary Gin Raimondo said, quote, they're the strongest controls ever enacted by the US to degrade the People's Republic of China's ability to make the most advanced chips that they're using in their military modernization. End quote. That's absolutely true, but they didn't hurt the tech companies that we regard as our crown jewels. If these sanctions were truly meant to be punitive, we wouldn't have been so selective in what we're blocking. We would have just cut China off for good. Hence the rally in the key stocks that matter. Your Chinese response again, despite what you heard, they were targeted. So called rare metals aren't really all that rare because there are ample supplies. You know what? Lots of inventory. Sounds like a gigantic guillotine. But in reality it was more of a kitchen knife. They hopped and they puffed, but they didn't blow the house down. Now the question becomes, could these Commerce Department moves be the high watermark of our sanctions against China? You heard me. I put that out there because I'm beginning to think that we may be misunderstanding even President Elect Trump's approach to China. Sure, he's about. He's appointed some tough talkers, notably Mark Rubio Secretary of State, this Michael Walsh National Security Adviser. The latter is a true China. But as the Financial Times pointed out in a very thoughtful piece, Elon Musk, arguably much more important to Trump than those other two, might be a wildcard in the new administration's dealings with China. As the sub headline asked, quote, do the billionaires longstanding ties to Beijing represent a diplomatic opportunity or a clash of political and business interests? End quote. After all, the FTSE notes, the Shanghai. Shanghai accounts for more than 40% of Tesla's manufacturing capacity and received billions of dollars in loans, subsidies and tax breaks from the Chinese. Musk very close to the government. He's close to President Xi Jinping. It's all pretty cozy. Yeah. Almost as cozy as Musk seems to be with President Elect Trump.
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Jim Cramer
Hmm.
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Commercial Voice
There's more to this. For instance, where's the key person who militated against China in Trump's first administration was Peter Navarro, the former director of the White House National Trade Council. And how is it possible that Canada, not China, but Canada, was among the first countries to be hammered by the President Elect? Canada had its prime minister pay a visit to Mar a Lago in order to state his case against 25% tariffs that the President President Elect wants to put on. Apparently, President Elect played the role of Jeff Probe's survivor. Mr. Trudeau ain't got nothing for you. President elect actually joked at Trudeau, if you can call it a joke, that if he didn't like the tariffs, maybe he'd like Canada to be the 51st. I don't think Trump has ever insulted China like that. Not even in Jess. Think about it. China gets hit with targeted bans by the Biden administration. Doesn't hit hard. Back same time Trump's coming after Canada, perhaps the greatest ally in American history, complaining about illegal aliens. Fentanyl. Now we do $436 billion in trade with Canada every year. That doesn't seem to matter at all when compared to the hordes of illegal immigrants and fentanyl smugglers coming from the north. I guess now we do have a small border problem with China, with Canada. The Washington Post reporting that as many as 24,000 per year try to cross the 5,500 25 mile border 4,000. But in the first three years the Biden presidency, we had 2 million people crossing the Mexican border illegally. 24,000 versus 2 million. Trudeau must have been astonished by that comparison. Do we have a fentanyl problem with Canada? In 2023, Customs seized 43 pounds of fentanyl from smugglers coming from Canada. That's a backpack's worth. But they seized more than 20 tons of fentanyl crossing from Mexico. I hope Trudeau was sitting down when he got that got hit with that stunning equivalency. Now, let's put it all together. On the one hand, we have Tesla CEO Elon Musk, who has a terrific relationship with China. On the other hand, we have Trump Hector in Canada savaging Mexico and not saying much about China at all. We haven't heard a word about Mar Lago bashing President Xi. But Trudeau gets the 51st state treatment. An ugly reference that won't soon be forgotten. So what's going on here? I'll tell you what I think now. First you could say maybe this is an ongoing White House team of rival situations like Doris Kearns Cuban wrote about in the Lincoln administration. Although the historical significance of Trump versus Lincoln is not lost on this TV host. Could it simply be a haphazard bashing of Canada along an ally who's fought side by side with us even in Afghanistan for many years? Or perhaps, perhaps, just perhaps, are we about to have a better relationship with China? A restoration of business ties, perhaps with a pledge that there be no attacks or embargoes on Taiwan or even Taiwan on the line? All I can tell you is with Elon Musk involvement in the new administration, it's very possible that we've indeed seen the high water mark in our tensions with China. I know it's hard to believe, but then again, Nixon went to China and he was the last person you would ever expected that from. We all know how horrible China has been to so many of our companies. But the bottom line, what happens if relations with the Chinese government are actually going to get better? Who's thinking of that? Could that be still one more reason to buy Apple stock even as it just hit an all time high? Should we be thinking about investing in Nike, Starbucks, Lamb Research, Applied Materials, Micron, Disney? Or how about Lululemon, which reports on Thursday? What can I say? I think the answer in every case may be a stunning yes. Let's go to Eric in Michigan.
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Caller
Eric, Jim, I love the show.
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Commercial Voice
Oh, thank you, buddy. What's going on?
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Caller
Jim, I just joined the club and been very impressed with the information I'm receiving thus far. So very helpful.
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Commercial Voice
Thank you so much.
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Caller
Welcome, Jim. The stock I'm calling on is General Motors. I bought the stock at 46 because of the impressive quarter after quarter beats, the EV strategy and the share buyback. What do I do now that Trump has warned of possible Mexico tariffs? I hold yourself.
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Commercial Voice
You hold it. Stock sells at 5 times earnings. That usually means that the earnings are actually going to come down next year. But Mary Barr has defied all expectations. Doesn't get talked about enough. We talk about the slanted sky out. We talk about the Ford. The stock does absolutely nothing. Here's what Volkswagen being in big trouble. Here's what I think. General Motors is better than ever. And you buy the stock. Buy the stock. Especially if it comes in below 50. All right, guys, look, I am saying something that nobody else is saying. I'm saying that there's a more optimistic thesis about China. What if relations with China actually get better? Think of all the stocks you want to buy. Then maybe be worth investing in stocks that you and I have written off. No, I didn't go so far as to say you should buy Chinese stocks, but I'm even thinking about that. Oh, everybody. Today I am revealing one of the biggest worries on Wall street ahead of the new calendar year. The fresh off of Math Den. We got this massive holiday shopping weekend. I'm going off the charts to get a read on some retail powerhouses. Later I'm catching up with Salesforce's top brand straight off the cloud computer best quarter I have seen them do. So stay with Kramer. Don't miss a of mad Money. Follow imkramer on X. Have a question? Tweet Kramer Madmentions. Send Jim an email to madmoneynbc.com or give us a call at 1-800-743-CNBC.
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Jim Cramer
Miss something?
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Commercial Voice
Head to madmoney.cnbc.com.
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- [11:27]
Jim Cramer
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We'Re at the point in the calendar year where the brokerages start publishing their official outlook for 2025. So far, they're almost universally positive. Makes sense. We're coming off a strong earnings season. Stocks have roared since the election. Everyone's betting that a more business friendly administration will make for better returns. But precisely because things seem to be going so well, I want to spend a few minutes just to think about what could go wrong with the market. See, after all these gains, you got to get a little squeamish, don't you? Unless something drastic happens in the next few weeks, we're in line for our second straight year of 20% plus returns for the S&P 500. First time that's happened since 1999. Not the best precedent. Plus the market's gotten really expensive by historical standards. The SB is trading at 27 times trailing earnings, substantially higher than the 20 year average of less than 19 times trailing earnings. We're also just technically overbought. The S and P short Range oscillator from Market Edge that I swear by hit a high of 5.9 yesterday, currently reached 4.9%. Anything over 4 is considered overbought, meaning we've come up too far too fast. Of course, none of these scary statistics matter at all unless something goes wrong, forcing Investors to back away from their bullishness. And what could go wrong? Honestly, my biggest worry right now is that Wall Street's gotten ahead of itself, expecting more rate cuts from the Fed than we're likely to get. Ever since the Fed started lowering rates for that double cut in September, we've witnessed something that's really unusual. While short interest rates came down, the longer term rates set by the bond market have actually soared. The Yield in the ten year treasury bottomed at just under 3.6% the day before the Fed's first rate cut. It had already risen to just under 4.3% by election day. Then it spiked to 4.5% on November 15th. Since then, long rates have pulled back with the ten year around 4.2% again. I think that's actually a major reason why the average has been so robust. But are we sure that long rates are done going higher? You know what, I'm not. Let's take a step back and think about what the Fed's trying to accomplish. After raising the Fed Funds rate by 525 basis points, Fed chief Jay Powell paused for a year and then finally started signaling. He sent signals about impending rate cuts the summer because we more or less had inflation under control and the economy was starting to slow. But Powell's always been adamant that the Fed's next move depends on the facts on the ground. So consider where we are now, two and a half months into this new easing era. If the Fed was worried that rates were too high and they were running the risk of hurting the economy, I think they can relax on that front. But the Fed is a dual mandate, doesn't it? They also need to maintain price stability, fight inflation. And we've made a lot of progress here to bring the rate of inflation down to around 2.5%. Fed needs to be careful not to undo that Progress. Back on November 13th, we learned the CPI, the consumer price Index tech ticked up though in October. That was the first increase since March. The latest reading, the Fed's preferred measure of inflation, the Personal Consumption Expenditures Index, a mouthful came out last week and it showed a similar uptick. The October PCE was up compared to September, while October's core PC, which excludes food and energy prices, saw the largest year over year increase since April. That's not what Jay Powell wants to see, nor does he want to see that gdp flash at 3.2%. A big revision up by the Fed, which has been saying we would hit 2.7 no more. That's a big jump. Too much Growth. Of course, October's uptick in inflation is far from the end of the world. At worst, it's a slight setback for the Fed. If we get core numbers for November and December, you know what, we'll be fine. But man, if President Elect Trump follows through with his proposed tariffs and some of our largest trading partners, that's going to be pretty inflationary. At the end of the day, a tariff is just a selective sales tax on imports. That's not helpful if you're worried about high prices. That also needs to be thinking about what happens if the Trump White House deports 11 million people, many of whom are working. We already don't have enough people to fill all our job openings. Mass deportations would be highly inflationary. Now, speculating about Trump's next move is a fool's error. And you never know what's policy and what's a negotiating tactic doing. Plus, his energy policy could actually bring down the price of oil and gas from these low levels. So we can say whether it be inflation or deflationary. I only bring up the proposed tariffs because it's something the Federal Reserve will be definitely thinking about when they make their plans for next year. So given that the economy is solid and we're seeing some slippage in the fight against inflation, I wouldn't be surprised if the Fed decides to slow down with the rate cuts. Unfortunately, that would be a big problem for the stock market because the bulls have been betting on much lower rates. Right now, the Fed Funds futures market is trading like there's a 70% chance of a rate cut at the next meeting two weeks. Now, it wouldn't shock me if we get a rate cut, but 70% odds, that seems high to me. What if we get a very strong November jobs report this Friday? What if we get another hot CPI reading next Wednesday, which shows that we've had two straight months of setbacks in the fight against inflation? That's too much. The market spending on December rate cut. Anything that derails that will be bad news for the average. Looking into 2025, there's a real lack of consensus. If you look at Fed funds futures for December 2025, there's a huge dispersion of expected outcomes. People betting on anything, zero to eight rate cuts. The most likely view for the Fed Funds rate futures is just three rate cuts between now and December 2025. And I actually think that sounds pretty reasonable. But even if that ends up happening, it would mean that roughly 41% of the market currently expects too many rate cuts. Over the next year. And that's a lot of disappointing money matters too many in my book. So here's the bottom line. Given all the success we've had in this market, we need to guard against complacency. And that's why I'm flagging my biggest worry, that the market might be getting too aggressive with its expectations for rate cuts over the next year. Any recalibration to those expectations could crush the averages. Which is why you need to watch out for the Friday jobs report and next Wednesday CPI report before focusing on next Fed meeting in two weeks. Be cognizant that things can still go wrong as right now I see a lot of people thinking things can only go right. May have money back every break. The holiday shopping season is in full swing and Kramer's going off the charts to see which retailers are separating themselves from the pack next.
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Jim Cramer
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Commercial Voice
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Now at the whole stretch from Black Friday through Cyber Mondays in the rearview mirror. Let's talk retail. Holiday shopping season is in full swing, the most wonderful time of the year for most stores, all the businesses. And we're starting to get some real insights to what's working, what's not. Big picture. This should be a relatively happy holiday season. We have a strong labor force. Everyone seems to have a job if they want one. Inflation has come down from very high levels. The Fed's gradually cutting interest rates to bring down the cost of borrowing. On the other hand, prices are still up, absurd amounts, as you know, versus where they were before the pandemic in 2019. And consumers, they're sick and tired of paying up. Over the past six months there's been tremendous pushback from the customer. People want bargains and if they don't offer them they'll just take their business somewhere else. I think that goes double during holiday season. Now we know that in the aggregate retail is doing great. According to MasterCard spending plus data. I love their data. Black Friday sales were up 3.4% year over year while online sales were up an astounding 14.6%. But competition is also intensified. Many people are still waiting for the deeper discounts tend to show up closer to Christmas. Regular viewers know that. I believe only a scant few retailers truly have the scale to give consumers what they want in this environment. And what they want is bargain basement prices. On the brick and mortar side. Wal Mart can do it because there are colossus and Costco can do it because they focus on carrying a small number of products in extreme bulk. Plus the profitability comes from club membership dues. So they don't mind selling much of their merchandise at razor thin margins or even cost as long as they can grow their customer base. Costco and Wal Mart know what their customers want and they constantly deliver on their expectations with good service, quality merchandise and deep value pricing. They've been taking share aggressively this year more than I've seen in many other years, running circles around the competitors who simply don't have the capacity to offer price sensitive consumers the same kind of deals. They don't. I mean just look at Target or calls, two stocks that collapsed after reporting dismal numbers because their prices just weren't low enough to compete in this new value driven world. When it comes to online shopping, it's all about Amazon. As we know, it's Amazon all the time. Sure some of the companies are picking up some business in the web like Williams, Sonoma or even Apple, but if you want something at a low price to sliver on time, Amazon is where you go. You know that the one problem the stocks of Wal Mart, Costco and Amazon have all they've run dramatically in the past 12 months and they really roared in November. Their stocks have gotten way overbought, meaning they've come up too far too fast. And that means they could be vulnerable to near term pullbacks. But could they still have some more upside from these levels? I mean to answer that question, we got to go off the charts and we're going there with Bob Lang. He's the founder of Explosive Options.net and author of you know your options. Let's Start with Lang's favorite Amazon. Check out the daily chart. Lang notes that Amazon recently pulled back from its floor of support at the 20 day moving average. An area where the stock often gives you sharp bounces. 20 is purple boom. When you look at the check in money flow which is the CMF down at the bottom the is an indicator that shows whether big institutions are buying or selling. It only just turned positive. Just meanwhile the moving average convergence divergence indicator, it's an important momentum indicator. Just made a bullish crossover right here. Okay. Where the black line goes above the red one. This is one of the most reliably positive signs that we could possibly have. At the same time, Lang points out that Amazon's had strong bullish volume trends since the start of November. You can see okay starting to come up here right now. Now it's rallying very hard on updates. That's what we want to look at volume here. Okay, you see this on updates how much it bought. This is again right to take off. That matters tremendously. Remember volume is like a polygraph when you look at the charts. High volume is a move is telling the truth. Sure enough, every dip is being bought here with the stock picking both higher highs and higher lows since August for line that's textbook definition of an uptrend. As he sees at Amazon, a 213 stock could easily cruise to $250 in the not too distant future. Wow. By the way, you know what? I think he's right. Which is why it's a core position for the Travel Trust which you can follow along by joining a CBC investing club. We talk about it and write about it all the time. Next I want to take a look at the daily chart of Wal Mart. Now this stock's been on fire since the company reported its magnificent quarter in mid August leading to a massive breakout on high volume. High volume. Best massive breakout ever since. Lang says we've seen a ton of institutional buying. Okay. The proof of that is in the chicken money flow. The CMF down at the bottom it slowed down recently. We were seeing a ton of buying pressure from the his period from August through November. Plus that slowdown appears temper as the check in money flow quickly pushed back into positive territory right there. Now the problem with Wal Mart is that it's already had a monster run. When you look at the relative strength index, the RSI and you can see this stock's clearly overbought from the markets perspective. It's run up too far too fast. Needs to digest its gains. I agree with that, Lang thinks it could use maybe a couple weeks of sideways consolidation for the stock market makes its next move. If the stock makes this move. And you know what, I got to tell you something, he's betting on a higher move. I think he's right. Right now wal Mart's A$93 stock. Langston is moving above $100 in early 2025, then taking off to $120 in the middle of the year. At the moment it's a very strong stock with incredible momentum. The Lang would like it more if it spent the next couple of weeks walking time in order to cool down a bit. That's what I'm hoping. I want this to go like this before because I love what's known as consolidation. Finally, how about the daily chart of long term Kramer Faith and Large Charitable Trust holding Costco. Back in late October, Costco made what Lang described as a perfect bounce off a 50 day moving average. We're looking at the blue perfect bounce boom and it hasn't really looked back since. The stock made a sharp move higher after two and a half month long period where it was pretty much trading sideways. That's that consolidation before the big up. According to line. Now the Costco is broken out. It clearly has. It's had some bullish volume trends in November. Stock also making higher highs, higher lows, classic uptrend. When you take a look at the chicken money flow, the CMF down at the bottom remains robust. Okay, like this. In fact, even during that long period of consolidation you can see that there was lots of institutional buy. Yes. That said, Lang thinks that Costco is a bit overboard here. You can see that in the rsi, the relative strength index, look how much, how high it is. Possibly could see a frustrating sideways move from these levels. And I tell you, I think even a meaningful pullback. See the company reports next Thursday. And as long term holders we know this stock has a history of reacting poorly to earnings because idiots sell it because they don't understand the company and that then they resume its march higher because the stock's in good shape. Because the company's in good shape. We have documented this so many times as part of the investing club bulletins that it's painful. But let them sell it off. What happens? The customer sells off say like 10%. We get a 10% correction. Lang says you should be a buyer because even with that kind of pullback the uptrend would remain intact. He recommends starting a small position now and buying some more on dips. Assume you don't own it already. I disagree. I think if you don't own it yet you have to wait for the sell off that I expect after the earnings. Here's the bottom line. The charges interpreted by Bob Lang suggest that Wal Mart, Costco and Amazon, the three kings of retail could have a lot more room to run. Although he wouldn't be surprised if there weren't some near term turbulence in Wal Mart and Costco that's given how much they've rallied now he would be a wire and you know he wants to buy it on weakness. And you know what, I agree. Bill in Massachusetts. Bill, Jimbo, nine years ago you nine.
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Caller
Weeks ago you told us on in the club to buy Home depot.
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Commercial Voice
It's up 17%. Everything you say is doing incredible. Should I pick up some more Home Depot?
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Caller
What do you think my friend?
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Commercial Voice
Okay, Home Depot. If it has any sort of pullback, you have to buy it. Why? This is actually the beginning of the earnings breakout we've been waiting for for years. Bill, thank you so much for flagging that. I pushed that when everyone told me stay away from Home Depot. You and my trust made money. Thank you for being a member. The charges interpret Bob Lang suggest that Walmart, Costco and Amazon could have a lot more room to run. I'd be a buyer but I'm waiting for weakness at this point. Much more money. And hey, my exclusive with talk about bullish Salesforce which is a triple bye bye bye. Plus I'm tracking some small business trends. Tell you where I think there's more work to be done. And yes indeed, all of your calls. Small aboard interests, no. So stay with Crane. When Salesforce reported for the close today, it delivered a very solid quarter. And some astonishing things to say about the early adoption of Asian force which is their air Asian platform that is going great guns already. In response to stock caught fire in after hours trading could have even more room to run. Earlier today we spoke with Mark Bennett. He's the co founder, chair and CEO of Salesforce. To learn more, I want you to take a look. Mr. Benioff, welcome back to bad buddy.
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Caller
Great to be with you, Jim. Thanks so much for having me once again.
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Commercial Voice
Well, Mark, I got to tell you I was afraid. I was afraid that your agent force wouldn't really even kick in until a quarter or two. It's obvious that was wrong. It's already started. It started in revolutionary fashion and you crushed the numbers while your operating margins expanded. I don't know. I do not know how this quarter was possible. Mark.
- [29:52]
Caller
Jim, we Are witnessing the greatest transformation in business in our history. This is a moment in time that we are seeing the creation of digital labor. And it's amazing what's happening at Salesforce. You know, for over 25 years, what we've done for companies and help them manage all of their customer information and sales in service, in marketing and commerce and analytics. We have slack. We have so many great ways for companies to help manage and share information. But now we have become a supplier of digital labor. And to see this digital labor opportunity is incredible. And we could not be more excited. And the results starting in this quarter are already showing what is going to be possible for the future. We closed over 200 agent force deals in the first week of it being available.
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Commercial Voice
I remember being out at Dreamforce and seeing trying to get on a machine to be able to line up. I've used the product. All I can tell you is I think it is a job creation machine. Yes, there is definitely digital labor. But it's allowing companies to have so much money they can now hire real people that they never could have. I think people are misinterpreting what this revolution really means, Jim.
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Caller
This is so exciting that even we are using it at Salesforce. Last night we flipped the switch. I know you already saw it. Our entire support mechanism is now agent based. We are an agent first company. We built what we call an agentic layer across the whole company. And agentic layer means that our customers are interacting with agents before they're interacting with humans. This is going to have a dramatic cost implication for how we're able to manage the company and also continue to grow our margins like you're seeing right in this quarterly result.
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Commercial Voice
I'm going to get right into this.
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Caller
What is happening?
- [31:44]
Commercial Voice
I want to get rid of this. We've had Shark Ninja on amazing company with incredible products. You go to Costco, you see them everywhere. And I would never think I would always I need help because I'm not good at an ice cream maker. Okay. But I. But Shark ninja could spend millions of dollars trying to help me. Or they could hire agent force. Correct.
- [32:04]
Caller
Well, Jim, we just closed a huge deal with Shark Ninja. You know their slushy machine, you know all the amazing products, you know their amazing CEO also named Mark. Well, they have a huge vision for the future of technology and how they're going to interact with their customers in a whole new way. And that is by optimizing the customer interaction using agents. And this idea that whether you're working with them in sales or working with them in service or interacting with them in their emails. Everything is going to be enhanced through this agent mechanism. And that's an incredible opportunity that we're able to harness the power of generative AI that we've seen. And we're delivering something absolutely incredible in Shark Ninja is going to be a huge success story based on this idea.
- [32:49]
Commercial Voice
I know they will grow much faster because now I'm going to pick out a customer. It's going to be a nightmare customer. No one is ever going to think they could ever be a customer because you just say, forget it, I'm not talking to them. Heathrow Airport, a nightmare for travelers. I didn't even know that you could even get their help. They are now offering help.
- [33:07]
Caller
That's exactly right, Jim. It's one of our launch customers with Agent Force. You know, when you interact with the airport well, you need to know what gate to go to, where your flight is, where the potential problems or snags are, and getting through the airport quickly, an agent is going to be with you all the way through from the beginning to the end of your traveling journey. This is going to make everything so much easier going through what is the world's busiest airport. It's another huge deal that we've closed. I could not be more excited that Heathrow Airport is part of Salesforce and now Agent Force. And I'll tell you, another incredible deal in the quarter was, you know, this amazing recruiting company which is called Adecco. And you probably know Adecco, Jim. Yes. I have 300 million applicants. Yeah. And agents are going to do everything from help you get your resume correctly to screen you, get you to the right employer. And that idea that we can help provide that digital labor to adecco, that is super exciting for us. Another incredible story. And Jim, this is just the beginning of a chain of stories. The number of conversations that I'm having with CEOs all over the world about a restructure, you know, their companies being coming agent first. This is an incredible opportunity. And like I said, Salesforce is really customer number zero. We have turned on our whole help infrastructure to be agent first. That idea that even at Salesforce, the idea that when you're interoperating on help for us, it's called help.salesforce.com Customers could come in through the website, they could come in through the phone, they could come in through some of their channel, they're going to interoperate with agents before they get passed to a human being. If the agent gets exhausted in terms of its Ability to deliver that is all of our content, all of our, all of our technical information, everything is now agent based. We are even running a experiment on the front of our website where we put an agent on the front of our website to help prospects understand our company more deeply. So this is really an incredible moment for everyone.
- [35:14]
Commercial Voice
You have hired a thousand people. Is that nearly enough that you need or do you need to hire another thousand people to handle this business?
- [35:23]
Caller
Well, Jim, you're right. We have expanded distribution opportunity. But I think that that is a incredible opportunity for Salesforce because we're going to be able to rebalance the folks that we don't need as many folks in support anymore because we have Agent Force and we can move them into distribution expansion. So as a CEO, I'm able to move headcount from here to here. That is incredible what that opportunity is for me. And I'll tell you Jim, I have to contrast that with the approach from Microsoft which I think, you know, they have introduced their competitor called Copilot over the last two years. But I think you and I know it's been a huge disappointment to customers. Copilot has been a huge flop. And as evidence of that, Jim, while Salesforce now is running its whole company on agent force and all of our support is on Agent Force and many other aspects of our business are now on agent Force, I would really challenge you to go to Microsoft's website, talk to any of their employees, see how they're using it all. I don't even think they can use Copilot inside Microsoft. So this is an opportunity for all customers to go to another level using this incredible capability.
- [36:31]
Commercial Voice
We did last night do a piece about how the PC revolution, the AIPC revolution has not taken off. And I think in part because people have not been blown away by the Copilot. Now I want to talk about a company that I would never buy.
- [36:44]
Caller
Clinton is missing on those PCs. They would. They said that button was there. It's just not. It's not even there.
- [36:49]
Commercial Voice
I can't see it.
- [36:50]
Caller
And you can see that in the transformation of these customers which everybody is wanting. But we're going to fill that gap with this incredible Agent Force.
- [36:57]
Commercial Voice
Now, are you going to do commercials that would entice us to be able to look for people and go for an agent, Want to ask for the agent? Are you going to do commercials that would be to drive companies to hire Salesforce, which is it going to be?
- [37:12]
Caller
We really have to show all of our customers that there's really two worlds now there's the world when you're using the Agentic platform and when you're not using Agentic platform. So customers who are using Agent Force, like amazing companies like you mentioned, like Heathrow or OpenTable. If you talk to Glenn at bookings to hear the incredible success that they've had with Agent Force, will you extend that?
- [37:35]
Commercial Voice
You know, he's the biggest travel agent in the world. Will he extend it to everything else? He sure did seem like he was going to do it in the Fortune magazine piece, you know.
- [37:42]
Caller
Well, I talk to Glenn every single day. He's a huge customer of mine and I think this is a tremendous opportunity for him.
- [37:49]
Commercial Voice
Do you talk in a Disney every day? I know Disney loves you.
- [37:53]
Caller
Disney. And Saks Fifth Avenue has turned on Agent Force as well, which is going to be a huge opportunity for this holiday season that you're just gonna be much more well dressed if you are, you know, a Saks Fifth Avenue customer because you're going to be interacting with Agent Force. We're going to make sure you look better. So we're going to make sure.
- [38:11]
Commercial Voice
When we go into healthcare, will we ask for the agent over the human?
- [38:16]
Caller
Jim, I literally on the way to the studio right here to do this with you, let me tell you something, I got a phone call from my hospital because I'm going to go in for some preoperative work and then there this and that, they're asking these questions, etc. You know, for my Jim, you know me too well. And so I'm like talking. When I hang up, I was like, you know, I think that just cost them 100 or $200 to cost me. We can probably do that for a couple dollars for them with AgentForce. Why isn't the hospital using an agentic platform? This is a tremendous opportunity for preoperative and postoperative care. And that is another great example. So let's just look at that. You're going to be healthier, you're going to be dressed better, you're going to get a better table at the restaurant, you're going to get through the airport quickly. I mean, every aspect of your life is going to be better. And we're going to operate our costs of our, of our businesses in a much lower, easier way. So this is a one last question.
- [39:15]
Commercial Voice
If I call the Benihoff Children's Hospitals, what will happen? Will I get Agent Force or is that a late adopter?
- [39:24]
Caller
Well, Jim, you know, we're having that conversation right now.
- [39:27]
Commercial Voice
Oh, I like the name on the door. Anyway, what an amazing quarter, a fantastic job. I can't wait to see you in person. Congratulations. Yes. And happy birthday to Lynn. 50 years old. Fantastic.
- [39:37]
Caller
And thanks so much for coming to Dreamforce. And you were there when we launched it and you saw how the customers, you saw, they bought it. They built 10,000 agents right at Dreamforce right in front of you. And we are so grateful to you, Jim, for coming.
- [39:49]
Commercial Voice
I'm a project user like Matthew McConaughey, another great project user whom I hope to see in some ads. That's Marc Benioff, co founder, chair and CEO of Salesforce. Congratulations, Mark. Great job.
- [40:01]
Caller
Thanks so much, Jim.
- [40:02]
Commercial Voice
Everybody's back after the break. Coming up, Kramer takes your calls. And the sky's the limit. It's a fast fire. Lightning round next. Do you think you missed the boat on the cyber Monday Black Friday excitement? Fear no more. There's a special offer that allows you to become part of the investing club for the next two days only you can take advantage of our best offer of the year to join. To sign up, simply open your phone, scan the QR code or visit cnbc.com/kramer club to join today. I hope to see you at our monthly meeting on Wednesday, December 18th. This truly is our best deal of the year. I wouldn't be talking about it and I don't want you to miss it. And now it is time. It is time for the lightning round of Kramer Spencer. I take part in the name of myself during the cold stock when everybody separates the way we plan it sound and then the lightning round is over. Are you ready, Skeet daddy? Tell me lighter on Kramer. Let's go to Mark in Wisconsin. Mark. Dr. Kramer, before I ask you about my stock, I just want to give a shout out to the memory of Art Cashing. I never got to meet the guy, but I certainly loved his commentary from the trading floor. And Bob Pisani and the morning crew gave him a nice send off this morning with a lot of humorous stories. The one I liked the best was when Art would order pigs in a blanket for breakfast. He'd call that Irish caviar. Yep. Well, there you go. He was really an inspiration to many of us. But go ahead, let's hit it out of the park. My stock, It's a spec $3 a share. Semiconductor, Vanguard and BlackRock have been buying it. Ticker NVTS. Okay, those. Those buyers are index buyers. And I've got to tell you, that company's losing a lot of money. I think you can take a flyer three bucks. But Understand it's losing a lot of money and it's a flyer. Let's go to Emil in New York.
- [42:15]
Caller
Emilia Boya, Jamie, Samuel. How are you?
- [42:18]
Commercial Voice
All right. How are you doing Porter?
- [42:19]
Caller
Good. Long time listener and the club member following you from the days of Action Alert plus.
- [42:24]
Commercial Voice
Oh my. Thank you so much.
- [42:26]
Caller
Of course. My stock today is a pharmaceutical company, one of your favorites, I think. The CEO was one of the first guests on Mad Money. He's been doing great, been up over 200% for five years, but for the past four months has been taking a nosedive down at least lost about 40% of value. One of their eye drops, eye disease medication is not selling as well. Jim, what do I do with Regeneron?
- [42:50]
Commercial Voice
By Regeneron is a quandary. I've got to tell you. I expected sales to be better. They're not. I don't want to give up on a stock down at $749. But I do prefer Eli Lilly even at $900. Because you know, I think that $900 is next stop for Lily at 8:13. I'm not sure what the next stop is for Generon. Let's go to Stephen in North Carolina. Stephen.
- [43:13]
Caller
Hi, Jim. I'm a grateful club member.
- [43:16]
Commercial Voice
Oh, thank you, thank you.
- [43:18]
Caller
I got into this in late June.
- [43:20]
Commercial Voice
After the it came public it sense more than double.
- [43:24]
Caller
I sold enough to recoup my initial investment. What should I do with the rest.
- [43:29]
Commercial Voice
Of my land Bridge? I'll tell you, that's a winner. I would just hold on to it. You've taken out your capital, I think. Let the rest run. And that, ladies and gentlemen, conclusion of the Lightning round. The Lightning round is sponsored by Charles Schwab. Coming up, Kramer is revealing the driving forces for small business creation across America. Next. Politicians love pandering to small business, which we're constantly being told that it's the backbone of the American economy. It's the one thing Democrats, Republicans seem to agree on. Yet as a serial small business owner myself, I'll tell you that Americans are sick and tired of hearing about it. They propose all these so called tax breaks, something Vice President Harris often trumpeted. But most small businesses are losing money hand over fist. What can they do with a tax break? You don't pay taxes when you're losing your shirt. But then out of nowhere, you hear something that just stops you dead in your tracks. Something that makes more sense than anything you've ever heard from any political candidate or small business loan officer. Throw that in, you hear Harley Finkelstein, the President of E Commerce king Shopify say that his company helped make the cost of failure when you're starting a new business lower than ever. Most small businesses fail, so reducing the cost of failure is huge. Harley talked about how Shopify offers real help to those who have an idea of something that people might buy. You have an idea, you have the materials, you call Shopify and they'll help you set up your business. Ah, but you say to yourself, shop, I won't get you any customers. It just facilitates online sales with very little friction. Great service, but it won't create demand out thin air. Not so fast. Last night Harley said something else that probably had eyes glazed over because we're all sick and tired of hearing that small business backbone nonsense. He said that Tick Tock and Instagram have become incredibly important ways to get the word out. The cost of these next to nothing. Sure, it helps you if you know the right music for TikTok, how big the letter should be. Yes, it matters. If you know the website software from Canva, it's terrific if you can afford the full Firefly AI suite from Adobe. That way you can create a website that looks and operates like something from a fortune biologic company. Again though, the real takeaway is that it now costs so little to advertise successfully and so little to take care of the E commerce site that the only gating factor is you and the idea itself. Oh, let's throw in cheap bookkeeping software from Intuit that can save you a fortune on cali fees. So let's say you have a passion. I don't snowboard. You can. You think you can make the best ones. Do you know that that's how Shopify started? The brainchild of Toby Lucky. He's the co founder of the company now the chairman CEO. Was his idea to make all the back office stuff simple, all because he wanted to sell a lot of snowboards, his passion, to the world. I think people like Finkelstein and Lucky and the guys behind TikTok and Met as Mark Zuckerberg with his Instagram have done more for small business than any government agency or certainly anyone bank. They've done more because the biggest problem with being the backbone of the US economy is that you need the rest of the skeleton. That's what these companies have created for small business owners. I just wish the politicians with their $50,000 tax credits for business with no profits, or the ones who say they'll clean up the regulations when you wish you had enough business that it even need to be regulated understood what these remarkable companies are doing. Then again, maybe it's best that they don't know. Who knows how badly they could screw things up if they got involved. Neither the president elect nor his defeated opponents seem to have any knowledge at all about small business. I think the secret's safe for those who realize that the cost of failure has come down dramatically when you're running a small business. And all this software has also made the odds of success much, much higher. I like to say there's always market summer. I promise you I'd find it just for you right here at Memoney. I'm Drew Kramer. See you tomorrow.
- [47:08]
Jim Cramer
All opinions expressed by Jim Cramer on this podcast are solely Kramer's opinions and do not reflect the opinions of CNBC, NBCUniversal, or their parent company or affiliates, and may have been previously disseminated by Kramer on television, radio, Internet or another medium. You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Kramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money disclaimer, please visit cnbc.com madmoneydisclaimer Gifting is hard, but here's a Give the gift of connection from US Cellular. Not sure what that means? Here's a slightly more specific hint. You can choose four free phones and get four lines for $90 a month from US Cellular. Your family wants new phones? How do we know? They told us. The good news is that compared to wrapping presents, you're great at getting hints. So take the hint and get them four free phones and four lines for $90 a month. US Cellular built for us.