Mad Money w/ Jim Cramer 9/25/25

Summary

Mad Money w/ Jim Cramer 9/25/25 — Detailed Summary

Date: September 25, 2025
Host: Jim Cramer (CNBC)
Episode Theme: Navigating Two Diverging Economies and the Market's Path Forward

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Overview

Jim Cramer takes a deep dive into the current state of the U.S. economy, highlighting the divergence between the booming artificial intelligence (AI)-driven tech sector and the struggling consumer sector. He explores how these divergent paths affect markets, delves into recent sector earnings (autos, housing, retail), assesses the market's technical health, and takes listener questions including buy/sell/hold opinions. Notably, Cramer interviews the CEO of Aquestive Therapeutics about their innovative allergy treatment. He closes the episode with key lessons on speculation versus investment, reinforcing the importance of careful stock picking amid market froth.

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Key Topics & Discussion Points

1. The Tale of Two Economies

(01:39 – 09:55)

• AI/Tech Economy vs. Consumer Economy:

  • Jim describes a split economy: tremendous growth in the AI sector, contrasted with ongoing weakness in the consumer-facing sector.

    “We have two economies. There’s the tremendous economy with amazing growth, one that’s connected to artificial intelligence. And then there’s the anemic economy connected to the consumer, which seems to deteriorate by the day.” — Cramer [01:44]

• Big Tech’s Financial Power:

  • Apples’s immense commitment—over $600B investments in the U.S.—and its rumored interest in supporting Intel:

    “Apple could build the foundries that Intel wanted to put up, hoping customers would follow...this would just be an asterisk when it comes to Apple’s balance sheet.” — Cramer [03:23]

• CoreWeave & OpenAI:

  • Reports a $6.5B deal bringing CoreWeave’s contract value with OpenAI to $22.4B—“there’s just that much related activity.”

• Physical Impact of Tech Expansion:

  • Meta building a $10B Louisiana data center leads to concerns about power strain for regular consumers:

    “We’re hearing rumblings just today about whether the regular consumers of power could be hurt by this deal...fights between consumers and tech for a long time.” — [05:52]

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2. The Weakness in the Real Economy

(06:40 – 09:55)

• CarMax Results:

  • "Awful" numbers: 20% stock drop, lower profit per car, weak sales, and rising loan losses.
  • Need for Fed rate cuts to revive business:

    “CarMax is a very good operator...but unless rates come down substantially, I think things will only get worse for this company.” — [07:10]

• KB Home and Housing:

  • Even solid builders are “choosing to build fewer homes” due to high-interest rates.
  • Mortgages tied to long rates; only substantial Fed cuts will help.

• Starbucks Layoffs:

  • Shrinking North American store count and billion-dollar restructuring.
  • Cramer bullish on CEO's turnaround plan:

    “The real economy. It stinks. I mean very bullish though... It’s going to send the earnings up, not down.” — [08:59]

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3. Market Leadership & What’s Moving the S&P 500

(08:59 – 09:55)

• Tech’s Dominance:

  • Since late 2022, AI-related stocks account for 75% of S&P returns, 80% of earnings growth, 90% of capex.
  • “Apple alone is committed to an investment program that’s actually larger than the entire commitment by the US Government to building the interstate highway system.” — [09:42]

• On Rate Cuts:

  • Despite strong headline GDP (3.8% Q2), underlying consumer weakness means rate cuts are still crucial for broad economic health.

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4. Lighting Round: Listener Questions (Selected Highlights)

(09:55 – 10:51, 29:27 – 42:50)

• Marvell Technology (MRVL) [10:11]:
  “Absolutely right...big buyback and insider buying...company has felt very maligned. Matt Murphy’s done a fantastic job...you got a winner.” — Cramer

• Sterling Infrastructure (STRL) [10:51]: “Very, very good company...but it is a real winner. It’s just got a very high price-to-earnings multiple...wait for it to cool off.”

• Coca-Cola (KO) [30:47]: “I think it’s a terrific stock...one of the few consumer packaged goods companies that really has a lot of momentum. Great level to buy.”

• Dutch Bros (BROS) [39:34]:
  “Stock has come down...I’d say buy some here and then buy some in the 40s...don’t expect to get back to the 30s. That’d be too cheap.”

• American Bitcoin (ABTC) [41:00]: “Total spec...doesn’t have any earnings. If you want one spec in your portfolio, that’s fine, but you could lose everything.”

• Republic Services (RSG) [42:08]: “Strong cash flow and dividend growth...but they just do nothing but go down. I need to see a bounce.”

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5. The Homebuilders: Rate Cuts & Realities

(13:37 – 20:17)

• Lennar & KB Home Earnings:

  • Lennar: Disappointing margins, weak sales despite more units delivered.
  • KB Home: Beat expectations, but still cut full-year forecast. “Buyers in a wait and see mode” [18:38].
  • Both NEED lower mortgage rates for meaningful sales growth.

  “Based on commentary from Lennar and KB Home, the bulls clearly got ahead of themselves here because so far we haven’t seen any meaningful increase in sales volume driven by lower mortgage rates.” — Cramer [19:08]

• Cramer’s Bottom Line:
  "Wait and see" on homebuilders due to risk of repeating last fall’s scenario—a Fed rate cut that didn’t bring mortgage rates down.

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6. Technical Market Analysis with Jessica Inskip

(21:40 – 29:27)

• Not a Bubble—Yet:

  • Inskip (Fidelity, Stockbrokers.com, Market Maker podcast) argues present market not like 2000.

    “This moment is not the year 2000. This market is not toppy. If anything, she thinks this market’s got legs.” — [21:48]

  • Tech weight in S&P is high but rose much quicker in the 90s/Bubble era.

  • S&P sector multiples are high but justified by sector mix and earnings.

  • Technicals: S&P above key support levels, RSI not overbought, equal-weight S&P breaking out—market breadth improving.

  • Watch for the dollar: Weakness helps tech; if it reverses, it could pressure the current rally.

  “The charts interpreted by Jessica Inskip suggest that this market is actually in much better shape than many people you hear come on TV and say that the end of the world, it’s 2000.” — Cramer [29:09]

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7. Interview: Aquestive Therapeutics CEO Dan Barber

(32:28 – 38:47)

• About Aquestive Therapeutics:

  • Two decades old, six FDA approvals, but always a small company until now.

• Anafilm—Gamechanger in Allergy/Anaphylaxis Treatment:

  • Oral thin-film epinephrine for anaphylaxis (allergic reactions): dissolves under the tongue.
  • Portability addresses main reason people don’t carry EpiPens.

  “The majority of people don’t have their rescue product with them, and the majority of times that an event happens, there’s not a rescue product available.” — Dan Barber [35:10]

• Market:

  • $1B potential, current scripts (5M/year) vs ~30M people who could use it.
  • Company aims for market expansion as ease-of-use removes resistance.

• Pipeline:

  • Alopecia areata product next, using same Adrenaverse technology for controlled release.

  “[Anafilm is] the first and only oral rescue medication for the treatment of anaphylaxis...dissolves in a couple of seconds and starts working right away.” — Dan Barber [33:28]

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8. Speculative Stocks: The Sell-off and Lessons in Speculation

(43:07 – 47:17)

• Market Shakeout:

  • Recent sharp selloff in speculative/“frothy” names—crypto, nuclear, quantum, healthcare specs.
  • “Bloodletting may not be over.”
  • Insiders finally selling some of the biggest bubble names a warning sign.

• Quality Still Outperforms:

  • Cramer encouraged to see shakeout—brings market back to reality.

• How to Speculate Wisely:

  • Limit to one speculative stock per five-stock portfolio.
  • Must have a strong balance sheet, a genuine edge, and conviction in your research.
  • If you have gains from speculation, take something “off the table.”

  “Speculation only works if you can work toward taking out your cost basis. When you do, you can let the rest run. But if you never take anything off the table, you’ll never have any real gains. And speculative gains can always turn into real losses.” — Cramer [46:20]

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Notable Quotes

• On Economic Divergence:
  “There’s the tremendous economy with amazing growth, one that’s connected to artificial intelligence. And then there’s the anemic economy connected to the consumer, which seems to deteriorate by the day.” — Cramer [01:44]

• On Consumer Weakness:
  “Autos, housing, retail, these are the foundation of our economy...the real economy. It stinks.” — Cramer [08:59]

• On Homebuilding:
  “Lennar and KB Home need lower mortgage rates in order to win and both companies sound optimistic about the prospect of those rates coming down. But man, ever since the Fed cut short rates last week, long rates have been on the rise again. That’s why I think it’s better to take a wait and see approach.” — Cramer [19:29]

• On Market Technicals:
  “This market is not toppy...she thinks this market’s got legs.” — Cramer, paraphrasing Jessica Inskip [21:48]

• On Speculation:
  “You can’t just buy anything...Speculation only works if you can work toward taking out your cost basis.” — Cramer [46:20]

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Timestamps for Key Segments

• 01:39 – Opening Market Commentary: “The Two Economies”
• 05:52 – Data Center Energy Demands vs. Consumers
• 06:40 – CarMax Weakness, Housing Challenges, Starbucks Cuts
• 09:55 – Lightning Round (Marvell, Sterling Infrastructure, etc.)
• 13:37 – Homebuilder Earnings Breakdown (Lennar, KB Home)
• 21:40 – Chart Analysis with Jessica Inskip (“It’s Not 2000”)
• 29:27 – Lightning Round (Coca-Cola, Dutch Bros, ABTC, Recursion, RSG)
• 32:28 – Aquestive Therapeutics CEO Interview
• 43:07 – The Speculative Sell-off: Lessons & Reflections

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Memorable Moments

• Jim’s Personal Allergy Story:
  “I have anaphylactic shock...I was carrying one...I said, to hell with it...But I’ll tell you something, I’m scared to death...” [34:31]

• Lighthearted Listener Banter:
  “Vero Beach. Oh, my God. The ESPYs live there. I’d say hi to them.” — Cramer [29:31]

• On Speculation Limits:
  “As I say in how to make money any market, you’re entitled to one spec. That’s it. But that could lose everything. Just as long as you know that that’s fine.” — Cramer [41:05]

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Episode Takeaways

• Tech and AI are powering stock market gains, but most Americans are not benefiting: “Wall Street’s averages mask profound consumer weakness.”
• Lower interest rates are still necessary to revive core parts of the economy (autos, housing, retail), despite strong GDP driven by tech.
• Be cautious when chasing homebuilder stocks; unless rates drop meaningfully, sales growth will be elusive.
• The market, while tech-heavy, is not exhibiting late-90s mania—fundamentals and breadth support current valuations, per technical analysis.
• Speculative fever broke (for now); investors should stick to quality and tread carefully with risky trades—keep speculation to 20% or less of their portfolio.

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For more information or to replay segments, visit madmoney.cnbc.com.

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Transcript

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[Jim Cramer]

Hey, I'm Kramer. Welcome to MAV Money. Welcome to Kramerica. Other people make friends. I'm just trying to make you a little money. My job is not just to entertain, but to educate, to teach you. So call me 1.907.3 CBC. Tweet me at Jim Cramer. We have two economies. There's the tremendous economy with amazing growth, one that's connected to artificial intelligence. And then there's the anemic economy connected to the consumer, which seems to deteriorate by the day. Oh, it's a stark contrast, but you can't really see it by looking at the averages. They mask it down. The climb 174 points. They have to be losing 0.5%. Nasdaq slipping.5 today the economy just takes up too much weight in the averages. Makes it harder to see the weaker consumer economy. But it's there. Lurking. It's there. Not a day goes by without something monumental happening in the economy. It's all the rage because business is that fabulous. Right now, for example, Intel, a once great semiconductor company, has been left behind by the AI revolution. Is needs money to get back in the game. Does it turn to a bank? Whoa. No, it's said to be turning to a Company much better than a bank. It's turning to Apple now. It's not clear at all whether this is really happening. I want people to take a breath here because, you know, there's been no confirmation from either side and I've been working to try to confirm, confirm it for about 48 hours. But it's natural to think that a distressed tech company like intel or would be seeking funds from Apple. Yes, Apple's just that rich and it's committed to investing $600 billion in the United States. So why wouldn't some of that go to intel if it asks? Heck, Apple could. It could some for the US Government and help pay for all that pie in the sky stuff that former CEO Pat Gelskier wanted to do with the Chips act subsidies. Apple could build the foundries that intel wanted to put up, hoping customers would follow. Okay, so let me step back for a second. That is not Apple's area of expertise. I find all that to be fanciful. But if it could find a way to use Intel's chips or Intel's foundry, I don't know, it might be worth it in some way, shape or form. Plus, most important, this would just be an asterisk when it comes to Apple's balance sheet. I'm not even sure rounding her. No matter what, intel can't be allowed to fail. But you need to know that this is the kind of chatter that happens every day because there's so much money sloshing around. What else? This morning, Core Weave, basically a company that runs data centers for the year, announced an expanded agreement with OpenAI, the company behind ChatGPT, for $6.5 billion, bringing its total contract value with Open Air to $22.4 billion. Now, can you think of any companies in the consumer economy that could sign a deal for 6.5 billion like that? I know I can't, but when the Core Week news broke, when I was sitting right over there and squawk on the street this morning, I couldn't even tell if it was worth mentioning. Yes, there's that much related activity I didn't want to cut into Carl and David, say guy 6.5. It just didn't seem to be worth it. Or how about matter? Now it's putting a gigantic $10 billion data center in Louisiana. This thing, such a monster that had to contract directly. The big utility in the state they've been on many times, Energy, which is building three new gas power plants to fuel it. That's equal to one fifth of the power that Energy currently Produces. We're hearing rumblings just today though about whether the regular consumers of power could be hurt by this deal. That's a new theme. Regular consumers of electricity being hurt by these humongous companies. Who ever heard of any other company impacting a state with its electricity needs? But these data center behemoths put so much stress on the grid these days that fighting, well, let's just put it, let's say that we're going to be hearing about fights between consumers and tech for a long time. All right, now let's deal with the other side. Let's deal with the so called regular economy. I have to tell you it is rough out there. Really rough. This morning we got results from CarMax. Oh my. The country's largest used car dealer. They were awful. Causing the stock to plunge 20%. Sales were 6% below Wall street expectations. There was incredibly weak unified profit per car was below expectations. Big loan losses too. Every line was suboptimal. What could help CarMax make the numbers? Well, you know exact. What a bunch of rate cuts. Their customers need lower rates as auto loans are priced off the shorter end of the yield curve. Mainly two and three year rates, ones that would come down if the Fed keeps cutting interest rates. CarMax is a very good operator by the way. But unless rates come down substantially, I think things will only get worse for this company. People think it's a dog. It's not. Or consider KB Home one, one of my favorites. Excellent home better. Plenty on it coming up later in the show. That's literally choosing to build fewer homes because it knows it's going to have a hard time selling them. Interest rates are incredibly important. The homebuilders, the KB Homes doesn't mince words. Rates are simply too high. Now you could argue that mortgages are priced off the long end of the curve. 30 years. That's the bond market that's in play, not the Fed. But if the Fed could take rates down substantially, the banks could offer customers a short term teaser rate. I bought one of those when I first got out of out of law school. That might breathe some life into this industry. We need more homes built because housing punches above its weight in the US economy as it's connected to so many other industries. Practically everything in the languishing pre economy starts or is connected to housing. Finally there's Starbucks which today announced that they were laying off 900 corporate workers as they also told us they'd be shrinking their North American store count by 1% this year. It's a billion dollar restructuring plan. It's meant to make Starbucks more profitable. You could argue that this could have been done at any time. But I think Starbucks is part of the real economy. The real economy. It stinks. I mean very bullish though. I think CEO Brian Nichols plan to get Starbucks back on track is terrific. And I advise members of the CBC Investing club in our morning meeting streaming show do some buy. It's going to send the earnings up, not down. Autos, housing, retail, these are the foundation of our economy. You think these groups will be growing? Well, with 3.8% GDP growth in the second quarter, this is the pace we learned about just this morning. But remember those numbers that JP Morgan strategist Michael Semblance wrote about in yesterday's edition of the Eye on the Market? Related stocks have accounted for 75% of the S&P returns, 80% of the earnings growth, 90% of its capital spending since Chachi Beat launched in late 2022. And remember, Nvidia allowed that to happen because it's based on Nvidia. Apple alone is committed to an investment program that's actually larger than the entire commitment by the US Government to building the interstate highway system, which was the biggest public works project in our nation's history. Of course this is a very tricky moment. President Trump can say that the economy is very strong, but we still need rate cuts because the part of the economy that's consumer oriented is weak and getting weaker even as the part that's related to hiring is hiring like bad. It's rolling in money. One thing's for certain, without rate cuts we aren't going to get more homes because some of the largest homebuilders like KB Homes rather just buy back stock and build homes. We know the CarMax used car weakness doesn't just isn't just going to stay with used cars. It'll be new cars too. In retail, after years of retrenchment, a lot of thanks to digital competition, retailers still have too many works, too many stores. Only an outfit like Wal Mart, which has the same scale as Amazon or Costco, can compete without worrying about its balance sheet. Oh, and by the way, Costco reported this very the numbers were fine. Costco does not trade like other companies. We kind of knew how they were doing. Not enough catalyst. That's why it's weaker now. I know it sounds crazy to suggest that we need rate cuts when prices are still elevated, often in self inflicted ways. Think tariffs. And we have a very strong 3.8% GDP growth. But the strength is in tech and there's just not much intersection between tech and the day to day life of our workforce or our lives except maybe with cell phones. Here's the bottom line. The writing is on the wall for a big chunk of the economy. If we don't get more rate cuts, things are going to keep sinking. The other part, the part is totally indifferent to rates. Most of these companies will never need to raise money. Even they do, it seems like they just sell equity to the deep pocket business partners. High rates for them just means higher returns because they have so much cash earning interest more than any time in financial history.

[Caller]

Patty in New Jersey Patty hi Jim, I'm a caller. I'm a first time caller but I've been watching Mad Money for a long time and truly appreciate your valuable insights.

[Jim Cramer]

Thank you.

[Caller]

I would like to know your take on Marvel Technology, Mr. Vl Is it at an inflection point to ride the strong AI and data center growth that we have been seeing it I think.

[Jim Cramer]

Absolutely right and just announced a big buyback and it's had a lot of insider buying and I've got to tell you this company has felt very maligned. Marvell is really an excellent Matt Murphy's done a fantastic job. It has been creeping up ever since the so called disappointment. It was up 3.7 today. You got a winner. I need to go to Marcia in Washington.

[Caller]

Marcia hi Jim, I'm a club member and second time caller and like your opinion on Sterling infrastructure Sprl well this.

[Jim Cramer]

Is a very interesting we're getting a lot of these infrastructure plays. This is a very very good company. It has moved up a great deal to civil engineer company. I think we have to wait for it to cool off. Marsha but it is a real winner. It's just got a very high price to earnings multiple anyway. I do like it though. I know it's hard to advocate for rate cuts with elevated prices and strong GDP growth, but the writings on a wall for a big chunk of the economy they don't get rate rate relief soon and it's not good. I'm everybody tonight I'm homing in on the housing market after recent reports from kp, Homan, Lennar and sharing. If I think now's the right time to buy this cohort then I'm going off the charts to see if we're nearing a top in or if this rally still has some legs to it despite the last three days. And we covered a quest of therapeutics last week but there's nothing better than going right to the source of the company's top rast on to learn more about the story. So stay with Kramer.

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[Jim Cramer]

Over the summer, many of the homebuilders started rallying anticipation of rate cuts from the Fed. But now the Fed start cutting and the group keeps rolling over. So what's going on here? Didn't we want rate cuts to jolt the industry out of the doldrums? Well, let's look at what happened when some of the key homebuilders recently reported first we got Lenore. The Miami based developer that's become one of the largest homebuilders in the country kicked these off last Thursday when they reported after the close on the Cobb's call. Matt acknowledged that with an easier fed, investors had begun to expect and anticipate an improved housing environment, hinting that we might be seeing the beginnings of that now. However, Linar quickly through cold water on those hopes, following up These comments by stating and I'm going to quote here with that said, our third quarter results reflect the the continued softening of market conditions and affordability through our third quarter, end quote. Ouch. Not exactly what investors were hoping to hear, but I posted weaker than expected revenue with lower than expected deliveries and average selling prices that were merely in line with expectations. The housing Gross margin 17.5% that's 30 basis points lower than anticipated, 500 basis points lower than the year before. Needless to say, the earnings were not that good. Even worse than our says, their earnings for the current quarter likely to come in below the expectation. And remember, Lennar is a fantastic company. As management explained in the conference call, while they ultimately delivered more units than expected last quarter, those sales required additional incentives to lure people in. What in which is what grows crushed the gross margin. Incentives mean of course they cut the price in order to get people to buy. Going forward, Leonard wants to be less promotional, but who knows if they can really make it happen. So if you were looking for some unapologetically positive commentary on the state of the housing market, Lenore Stuart Miller CEO he didn't give it to well, some investors were hopeful that just the expectations of lower interest rates would be enough to jumpstart sales. Management took much more of a curb your enthusiasm approach. Listen to this quote. Even though mortgage rates began to trend downward towards the end of the quarter, stronger sales have not yet followed. However, they also talked about, quote, early signs of greater customer interest and stronger traffic entering the market, end quote and said that interest rates continue to fall. They're quite optimistic that stronger sales activity will come soon. So maybe you want to call green shoots and that things can get better if rates continue to come down. Could be worse, but it's not what the bulls were really hoping for. On a more optimistic note, management acknowledged that because of the extended period of high interest rates, Lennar has been forced to cut its construction costs in an effort to make housing more affordable going forward. Management believes this leaner cost structure will allow them to clean up once the housing market rebounds. And they're pretty confident that as mortgage rates approach the 6% level or lower, demand really will start to kick in. Right now we're at roughly 6.4% for a 30 year fixed mortgage. Now that's far cry from 7% plus rates we were getting. Those are the rates we were getting to be of the year. But you see it's still up slightly from the sub 6.2% level we had just before the Fed cut rates like everybody else in the industry, Lennar needs lower long term interest rates. Usually when the Fed cuts short rates, long rates will come down too. But that's not always the case. Last fall, for instance, the Fed cut short rates and long rates skyrocketed. Worth keeping in mind. I mean, I know. I'm very concerned that we could repeat last year's fiasco as long rates are still creeping up higher after that last recent rate cut. That's not good. Next up, KB Homes reported last night and even though it was another really good home builder, by the way, even though it's more encouraging than an hour, it wasn't that much better. KB Homes actually posted notably better than expected sales. Average selling price came in a bit above expectations too, better than expected deliveries, although both of those were still down year over year. The gross margin also came in ahead of the consensus estimate, leading to a nice bottom line beat. Despite those generally better than expected results, though, KB Homes still cut their full year sales forecast by a size month amount. How about the commentary? Management's adamant that the long term outlook for housing remains favorable, driven by both demographics and shortage of homes. As for the shorter term outlook, KB Homes saw some positive signs starting in June with price stability and demand that continued as the quarter progress. They also find the decline in mortgage rates encouraging, although apparently not encouraging enough for them to maintain that full year sales forecast. Still, management did some something I thought was very useful. In the conference call, they broke out in detail what lower mortgage rates mean for their business and for the customer. Mortgage rates have fallen roughly 60 basis points from earlier this year and the company says that adds $30,000 of purchasing power based on their average selling price. Now that's a good chunk of change, especially for the first time homebuyers or those looking to upgrade for the first time groups that make up 70% of KB Homes customers. This is, you know, it's a group of more moderately income people. The company seems to be taking a different approach than Lennar, which got very promotional last quarter in order to sell more units. KBO maintains they don't need to chase incremental volume right now. Currently, they say speculative builders, spec builders are discounting heavily to close out the year and they don't want to crush their own margins by trying to compete with that. That said, while management noted that orders have been good, they also said, quote, I wouldn't say that we've seen a big uptick yet or maybe the uptick that we would expect to see from such a change in mortgage rates. Not ideal. As for why that's the case, listen this quote, I think to some extent buyers are in maybe a bit of a wait and see mode, end quote, knowing that potential homebuyers might be waiting for rates to come down even further before they pull the trigger. And I think that's exactly what is happening. Exactly. See, they'd rather kpop was rather buy back stock if it comes down a little bit more then just put up homes for the sake of putting up homes. Especially if the gross margins are going to decline as anything will happen in December. So what have we learned from these homebuilders so far? In short, based on commentary from Lenore and KB Home, the bulls clearly got ahead of themselves here because so far we haven't seen any meaningful increase in sales volume driven by lower mortgage rates. So let me give you the bottom line here on this really important industry. As I said at the top of the show, Lenore and KB Home need lower mortgage rates in order to win and both companies sound optimistic about the prospect of those rates coming down. But man, ever since the Fed cut short rates last week, long rates have been on the rise again. That's why I think it's better to take a wait and see approach the homebuilders just in case we see a repeat of last fall where the Fed started cutting and it didn't make a difference. If anything, it drove the bond market in the wrong direction and mortgage rates higher Bit money's back here for the break.

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Coming up, tax on top again. But is this a 2000 redux? Forget the boy bands and low rise jeans. Kramer is taking to the charts to see what the rally's really signaling next.

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[Jim Cramer]

If to continue this ad, please upgrade to premium plus platinum.

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[Jim Cramer]

You know, last night I got a little worried about these froth levels. Movie See many ultra specular stocks shooting the stratosphere. Even though most of them have no earnings, some of them had barely any revenue. I've been willing to recommend many of these specs on the way up, but at a certain point these moves give me vertigo, making me nervous about the broader market too. I actually thought it was reassuring. Today the specs got clobbered. I never want anyone to lose money, but we needed this. Still, ever since the average bottom in April, it has been a mistake to bet against this market. So tonight I want to expose you to a more sanguine worldview. Which is why we're going off the charts a second time this week, this time with the help of Jessica Inskip. She's that first woman on the active trader desk of Fidelity who's now director of investor [e-mail] as well as the co host and founder of her Market Maker podcast. She's got a very good track record lately, and right now Inskip is adamant. This was such a reassuring thing to me that this moment is not the year 2000. This market is not toppy. If anything, she thinks this market's got legs. Why? First, take a look at this chart of the sector weightings in the S&P 500 going back to the 90s. All right. Points out that even though the S and P is increasingly tech heavy these days with information technology make up 33.48% of the index indecs up from 20% in early 2019. That's nowhere near what happened during the dot com era. Back in 1994, tech accounted for just we go all the way back here, just 6% of the SB. By the year of 2000 it was 28.4%. That is more than 22 percentage points increase over the course of the dot com Europe over the past six years. Tax weighting in the S and P is up only less than 14 points. Okay, so it's slow, it's gradual. See, she thinks that it was the velocity of the change that created the bubble in the 90s. And so far we haven't seen anything close to what we saw in the 90s. If you want to insist on a dot com comparison, I say look at the chart. The Current moment feels more like 1998. And that was a great time to be a buyer. Now Inscape recognizes that Wall street often slaps an overvalued label in the S&P 500 when it's forward price to earnings multiple gets close to 25 times earnings. Basically where we are right now. However, today's S and P is not like the S and P of 10 or 20 years ago. The sector mix has changed dramatically. Like I just mentioned, there's a lot more tech in the index these days. So maybe we shouldn't be so focused on the index wide multiple in my book. My new book comes out next week. How to Make Money in Any Market. I describe the multiple. If you don't know what the multiple is, the book will really help. Okay. Because I know it's a complex term. Now take a look at this daily chart of the S&P 500 in red with the forward price to earnings on multiple of the information technology sector in blue. Okay, this. See that? It's a complex term but we're going to deal with it. Most technicians don't overlay the price journeys multiple on top of the price action. But inscript likes doing this because it's a great way to tell prices are moving too far too fast relative to earnings. I love this chart. Inscape has found that The S&P 500 tends to sputter when the tech sector's forward price earnings volume gets above 34. 4. But we're not there yet. Tech sectors poor PE multiple currently in the low 30s. So she thinks we've still got a little more room for multiple expansion for it starts feeling like the markets come up too far too fast. Plus when you look at the good old weekly chart of The S&P 500, this is really positive. Inskip likes what you see. For starters, the S and P still has a bullish trading cycle. Inscip which is watches its 13 week, okay, the 26 week and the 40 week moving average, they represent 1, 2 and 3 quarters worth of action. Remember, the quarter is the basic unit of time keeping this business right. Now all three of these key moving averages are sloping upwards. See that? It's slope. It's not. Not this. But that's okay. We don't want that. And acting as floors of support underneath the index. Right now she points out that we've got a floor at 6430. There's the 6434. Okay. 13 week moving, moving average and then we got another floor at 6147. Okay, these are all good floors and that was high set back in mid February. Last time we spoke to Inskip in early August she was watching the Bollinger bands, these purple lines above and below the price action that represent the level of volatility. Specifically she wanted to see those bands narrow. And that's exactly what's happened. See here and then down to here. More importantly, as you're watching the rsi, the relative strength index down here at the the bottom. This is an important momentum indicator and it reached levels very close to what many technicians would call overvalued. Anything above 70 is usually that is considered a red flag. But it gives us we only need to worry about the RSI when it reaches higher highs while the S and P fails to make a new high. This is an indicator that helps measure when we've come up too far, too fast, but so far and Skip doesn't see it. However, if the RSI starts retreating and then that's why she'd be worried. So don't be fearful about this. It's fine. How about the weekly chart of the s and P500 but this time the equal weight. This is very, very significant. Why? Because this is the other companies that aren't so big. This weighs all the stocks index equally rather than by market capitalization. We look at this because it shows you what's happening with the 493 stocks that aren't part of the Magnificent Seven. This represents whether we're narrow or broad. But right now Inscape points out that this S and P equal weight finally gave us that higher high that she wanted so badly. To her this is a signal that the market's broadening again after a period where we were stuck with a very narrow tech led rally. Now that the S and P equal weight has broken through its ceiling of resistance at 7612. That's our ceiling resistance and it broke through right there. That's the level of, that's the levels new floor of support. It extends from the high back in November of last year when the market soared after the election only to be derailed by rising long term interest rates. The regular market cap weighted S and P took out its highs from last November way back in June. So we go back here, we can see it took out the highs. The S and P equal weight didn't do the same until mid August, but at least we got there. As long as the S and P equal weight stays above this floor that we're talking about. Well you know what she thinks this rally can continue to broaden. And remember, remember, it's all concentrated in the Magic 7. A lot of people really do freak out. I don't, but people do. When you look at the relative strength index for the S and P equal weight, it's having a hard time confirming the index recent highs. It's kind of doing nothing there. Right. Instead, the RSI has been leveling out to inscape. This predicts sideways action requires a new catalyst to move the index higher or lower. But she's betting that the next catalyst will be positive. In other words, mark time. Mark time, Mark time and then positive catalyst. Finally, how about the week? The chart of the X, L, K, that's the technology select sector spider fund relative to the dollar index. Isn't this interesting? We've got the dollar index and then the X L, K separately down at the bottom. All right. Skip wanted to point out this because as you can see, there's a very strong relationship between a weakening dollar and strengthening tech stocks. Kind of interesting. I felt right, but that's a lot of. That's overseas sales. Last time we checked in with her, she said that XLK would rally with a stable weakening dollar. We got stability and the tech ETF soared. Let's hope the dollar stays relatively soft because that could justify how we're doing here. It's obviously a nice run as the dollar got weaker. Very positive. The bottom line here. I know I threw a lot at you, but the charts interpreted by Jessica Inskip suggest that this market is actually in much better shape than many people you Hear come on TV and say that the end of the world, it's 2000. She doesn't think we've come up too far too fast. If anything, she says this bull market still got legs, especially as long as the dollar doesn't make a comeback. Let's take some calls. Let's go to Frank in Florida. Frank.

[Caller]

Hi, Jim. Booyah. How are you?

[Jim Cramer]

Oh, God. Vero Beach. Oh, my God. The ESPYs live there. I'd say hi to them.

[Caller]

That's great. Great area. We absolutely love it.

[Jim Cramer]

It's fabulous.

[Caller]

It is. Thank you. You need to come visit us. Longtime listener, first time caller. I love your show. We do have something in common. I was a student in Tallahassee at Florida State. When you were starting out as a reporter in the late 70s, you were at T. Hassey.

[Jim Cramer]

You were at Tea House.

[Caller]

Tea House in Tallahassee.

[Jim Cramer]

I was right next to Jim and Milt's.

[Caller]

Oh, were you really? I ate there many times. I'm Sorry. Sorry. Down a few years ago but that was breakfast and barbecue but absolutely.

[Jim Cramer]

Let's go to work.

[Caller]

We were able. One quick thing I wanted to say we were able to witness Bobby Boutten starting that football program.

[Jim Cramer]

Of course I did. What are you kidding me? What do you like? You think I'm think I'm a naif? Of course. Let's go.

[Caller]

Yeah, he's great. And Purvel has a team back in the top 10 and say go Knowles baby.

[Jim Cramer]

Well good quarterback always do it. All right.

[Caller]

That's great.

[Jim Cramer]

How do we do? What do. What are we doing here?

[Caller]

My question for you is I've owned Koch stock for almost as long as Warren Buffett. What are your short term and long term thoughts on it?

[Jim Cramer]

I think it's a terrific stock. It's one of the few consumer packaged goods companies that really has a lot of momentum. The stocks come down a bit. I think it's a great level to buy and I think James Quincy is terrific and I think you're terrific too. It was great to talk to someone Tallahassee and Vero Beach. I mean we are kindred. I can't believe we don't know each other. We probably bumped into each other big daddies, you know between the six and seven o' clock when the drinks only 15 cents. Right. The charges interpreted but just Gaines get put into a market in a better state than a lot of people believe. And as long as we don't go higher too fast he thinks good shape. Much more mad ahead including my sit down with Equested Therapeutics a company aiming to revolutionize how to treat severe allergic reactions like the one that I got to anchovies. And we'll hear more about the plans from the CEO himself then speculative stocks of all shapes and sizes sold off today I'm breaking down what this shakeout could mean for you and all your calls Rapid fire in tonight's edition of the Lightning Round. So stay with Kramer. Two weeks ago I got this call from Andrew in California. We want to know about a biotech company called Acquisitive Therapeutics. I didn't know this one. Give me the whole pitch. Talked about how they've got a replacement for the EpiPen dissolves in your mouth rather than needing to be stabbed into your body. Because I wasn't familiar with this one I circled back last Thursday and if you some homework. I gave it my blessing for speculation. This is the kind of stock I like to speculate it. So far it's only been weak stocks up 6.5%. But if the FDA approved their treatment for anaphylactic shock, a lot more upside. Don't take it from me. Let's hear from Dan Barber. He's the President and CEO of Acquisitive Therapeutics. To get a better situation. Mr. Barbara, welcome to that money.

[Fox News Announcer]

Thank you, Jim. Thank you so much for having me. Excited to be here.

[Jim Cramer]

Absolutely. Look, I think you've got a winner. I want people to understand exactly what you do in the mechanism and why it's preferable for those who didn't catch two pieces already that we've done. And I just think sometimes when you have a really interesting spec, you should pursue it.

[Fox News Announcer]

Sure, sure. If you're okay, I'll tell a little history of the company because it kind of gets you there. We've. We've actually been around for about two decades, and over those two decades, we have six approvals with the fda. We have product that is sold in six continents. We have two and a half billion doses we put in the hands of patients. But the problem with Requestive, as you pointed out last week on your show, is we've always been small. We've always been 50 to 70 million dollars in revenue.

[Jim Cramer]

We don't want niche, we want broad.

[Fox News Announcer]

But now with our new product, our Anafilm product, we finally have a potential blockbuster product on our hands. It's under review with the FDA right now. And when I say blockbuster, in my mind, I think it could be $1 billion worldwide at peak. To have $1 billion drug, you've got to do something pretty special, right?

[Jim Cramer]

Absolutely.

[Fox News Announcer]

So with our product, we have the first and only oral rescue medication for the treatment of anaphylaxis. And you asked about how it works. We actually had to take both of our technologies to make the product. The first technology is oral thin film, which, if you can envision a little film, that's a stamp that you put under your tongue, dissolves in a couple of seconds and starts working right away. That's our technology. We call it farm film. And I actually, if you're okay, I brought a sample for you today to see.

[Jim Cramer]

No, I want to see it.

[Fox News Announcer]

This is what it looks like if you see.

[Jim Cramer]

It's like a business card.

[Fox News Announcer]

Yeah. If you see the white right here, that's. That's the foil that actually holds the film. So what we love about this technology is you can take it wherever you go.

[Jim Cramer]

Right.

[Fox News Announcer]

It's an extension of you. So from our perspective, when you talk about a rescue medication, that fits right in the need. In fact, I have A good friend who was saying me to the other day that when she leaves the house she forgets things all the time, but she never forgets her wallet, her keys or her phone. So wallet, keys, phone. We're always with you.

[Jim Cramer]

Well, Dan, I gotta tell you, one of the reasons why I am so intrigued by you is that I have it. I have anaphylactic shot. I heard.

[Fox News Announcer]

Yes.

[Jim Cramer]

And I was carrying one. I don't know, I don't want to pick one, but it's a 30 minute one and it's a big orange one, let's call it that. And after two years, I said, to hell with it. Nothing's happened. The hell with it. Because I didn't want to carry it everywhere. And it was always in my coat pocket, no matter what. What. And it was. I could put it in my jacket pocket. And I said, no, this is too cumbersome. I'll just be more careful about what I eat. But I'll tell you something, I'm scared to death that I don't eat by. You know, I'm one of those guys that. Any allergies? Yes, I have anchovies because anchovies will kill me.

[Fox News Announcer]

Yeah, no, you're not. You're not unique. In fact, when we talk with patients and we're out in the community, the majority of people don't have their rescue product with them. And the majority of times that an event happens, there's not a rescue product available. And when you, when you look at why you hit, some of the real reasons people think they can avoid it. They don't want to go home if they forgot it, they don't want to carry it with them. I mean, just the other day TJ Watt, a famous football player, said, look, I know I'm supposed to carry it, but I just don't. And actually, you and I were just talking about. We live in the same town in New Jersey. My son at his high school prom had three kids who went to the emergency room because they, the place that threw the prom, put chicken out and put a peanut sauce over the chicken without labeling it. And none of those kids had an auto injector with them. One of them is a good friend of my family and said, well, if I had the film, I would have.

[Jim Cramer]

Had it with absolutely no wood. Now, okay, so the FDA obviously must want this because they know that people do exactly what you just described. So, so what's the process right now? Because it sounds like that they're kind of fast tracking it, but I don't want to ever get. It's a new fda. I don't want to get ahead of it.

[Fox News Announcer]

Yeah, well, I wish it was fast tracked. It is fast track designated. But we do have a standard review time. So we filed at the end of March. We have an action date. So the action dates when the FDA will give you an answer of January 31st. And we recently found out sometimes the FDA will ask for an advisory committee meeting. They want experts to weigh in on your program. They had warned us they might want one and they actually just recently said to us we don't need an advisory committee meeting. So we feel really good about where we are with the FDA right now.

[Jim Cramer]

Okay. Now I'm trying to figure out that billion dollar total industrial market. 95% of people believe a film dosing option fits an unmet need in the epinephrine market. Are you thinking that if it was approved therefore you would see the market expand? Because people right now keeping the market down just by the fact that they're not, they're willing to risk it.

[Fox News Announcer]

That's right. It's about a billion dollar dollar market worldwide right now it's 800 million in the US or so. But there's 5 million scripts written a year. The prevalence rate. So the number of people who should have a rescue product with them is actually over 30 million. So as you know, with drugs you're never going to get to the prevalence rate. But with awareness, with a better product and with the natural growth rate in the market, we think going from 5 to 10 million is very doable in the next few years.

[Jim Cramer]

I just want to ask because I know someone who has this one and it's tough one Alopecia, you've got something, but that's a little further away. Right, but is there any hope?

[Fox News Announcer]

Yeah, well, you know, and I'm really glad you brought that up because Anafilm is based on our Adreniverse technology. And Adreniverse is adrenaline is adrenaline. Verse means we have multiple. Right. And what that technology does is it takes epinephrine, which is a very powerful molecule.

[Jim Cramer]

Right.

[Fox News Announcer]

We make it in our bodies, but it's a very hard molecule to, to control. It doesn't like to be absorbed and it metabolizes very fast. So what we can do with our technology, get it to absorb and have different release rates. So now we have Anafilm where we've created that with our Adreniverse technology. Alopecia areata will be our next one. So different release profile and we'll have more products after that. So When I look at where we are right now with that platform, I think we have a long ways to go.

[Jim Cramer]

I agree. Well, again, I reiterate that. That this is just something that hit our radar screen because of a very good viewer. That's how a lot of individual ideas come from our viewers. And this was terrific that we've been. I didn't know you were from Summit. But that it's been brought forward because I believe. And with that Stan Barber's presidency of a quest of therapeutics. Guys, they have so many very clear, easy to read documents. You will understand it very well and I think it's certainly worth speculating. And Mad Money's back here for the break. Thank you.

[Mad Money Producer/Promoter]

Coming up, lightning doesn't just strike twice in Cramerica.

[Jim Cramer]

Booyah.

[Caller]

Jimmy, chill.

[Jim Cramer]

Booyah. Booyah. Booyah. Thanks for taking my call.

[Mad Money Producer/Promoter]

It strikes every day. Kramer is back in a flash with your questions.

[Jim Cramer]

Next, it is time to talk to the library crew member. And rock balls every 10 minutes are my step first. And weapons of the flying planet sound. And then the lightning round is over. Are you ready? Ski dagtown light round clears. And let's start with Connor in Florida. Connor. Booyah. How we doing, Kramer? I'm doing real well. How about you, chief? Great, man.

[Caller]

I'm calling in from Chip and Bug.

[Jim Cramer]

Weld headquarters at fsu. Go Knowles. Go Knowles is right. Absolutely. Good qb. Let's go to work. There's some speculation around this one. I just recently bought quite a bit. Tell me how you feel about bro Dutch Bros. I like Dutch Bros. Now let me tell you something about Dutch Bros. This stock has now come down from 86 to 53 as the speculative froth comes out of it. I would say buy some here and then buy some in the 40s and I think you'll be in very good shape. Don't expect to get back all these in 30s. That'd be way, way too cheap. Peter. New York. Peter.

[Caller]

Hey, Jim. Congratulations on 20 plus years on Mad Money.

[Jim Cramer]

Thanks you, boss. Thank you.

[Caller]

And 37 years or more helping us folks make money.

[Jim Cramer]

Well, that's the plan. That's been the plan for almost four decades. Holy cow. What's up?

[Caller]

I know, I know. Well, your staff is super. Josh and Sean are second to none. A quick shout out to my mom Elizabeth, who turned 107 last May and isn't doing as well as we wanted to be. But she always seems quite awesome. Yeah, I know. She always said quite often we watch Mad Money together that you had a lot of gumption. I asked the mom. What's that? What do you mean? Says implying a smart spirited, drive, resourcefulness, common sense with added humor. She always got a kick out of you, Jen.

[Jim Cramer]

That's great. Tell her I'm owned by no one. That also helps. Owned by no one. Let's go to work.

[Caller]

That's right, sir. My stock is ABTC American Bitcoin.

[Jim Cramer]

Bitcoin, okay. This is a total spec. As you know. It's a. It's a very inexpensive, I mean dollar amount. But it may be an expensive actual amount because it doesn't have any earnings. It's a spec. It's your one spec. As I say in how to make money. Any market you're entitled to one spec. That's it. But that could lose everything. Just as long as you know that that's fine. Let's go to Trey in Minnesota. Trey.

[Caller]

Hey, Kramer. Preorder your book. And I can't wait to get it now, next week.

[Jim Cramer]

Thank you very kind. Talking about the book. Let's go to work.

[Caller]

Yeah. Jay. Larry Ellison is called a powered drug design. A multitrillion dollar industry one AI drug discovery stock that has the backing of your favorite Nvidia is Recursion Pharmaceuticals. What do you think about taking the space?

[Jim Cramer]

I don't know. It's been such a dog. It's been a dog. We had the mortal twice the price. It's done absolutely nothing. I need to see a proof of concept here. I absolutely know that Nvidia is in it. But you know what? This. This stock has been a bad stock. We need to see something good before. I tell you I would put any money in it. Let's go to Ike in Georgia. Ike. Booyah, Jim. Booyah, Ike. What's going on? So much.

[Caller]

Thanks for all you do, man.

[Jim Cramer]

Oh, thank you. Yes.

[Caller]

Iris G. Has been a steady performer in my profession. Portfolio strong cash flow and dividend growth. But we rise in long term interest rate and pressure on infrastructure. Infrastructure spending.

[Jim Cramer]

Okay.

[Caller]

Yes. Republic Saudi's a trash to treasure or time to die.

[Jim Cramer]

I don't understand this in wm, you know, the old waste management. They're both so good and they just do nothing but go down. I need to see a bounce. As Jeff Barks would say. How about a bounce? And I agree. And that, ladies and gentlemen, is the conclusion of the Lightning round.

[Mad Money Producer/Promoter]

The Lightning round is sponsored by Charles Schwab. Coming up, speculative high flyers got grounded. Is it a warning or a wake up call? Kramer breaks it down next.

[Caller]

Oh, yeah. Jim, your integrity makes you the Booyah.

[Jim Cramer]

Saint of Wall Street Booyah, Jimmy Chill. Booyah Jimmy Chillah. Jim Quadruple. That's a lot of booyah. I said I was done with aggressive speculation the other night. It looks like. Well, I wasn't alone. They the anvil landed hard on that entire cohort. I'm not sure if the bloodletting is over. Sellers clobbered the nuclear stocks, hammered the crypto stocks, nailed the quantum stocks, trashed the speculative health care stocks. I don't know which is the chicken and which is the egg, but the actual cryptocurrency declines were brutal. Theorem down nearly 7% today. It was a powerful reminder of just how fraught these speculative plays can be. What was it? Well, first we finally saw some big insider sales like I've been looking for. This time in oclo, the hottest nuclear reactor stock, including from Michael Klein, a board member, one of the company's top shareholders, and from the company's husband and wife co founders who currently serve as CEO and CEO respectively. It wasn't the equivalent of a raft of selling, but sure got noticed. On top of that, this was still one more day where higher interest rates are just plaguing us. Okay, historically higher rates are the kiss of death for this kind of speculation. We got to be aware of this. But what I found most ironic was an actual real life example of the power of IBM's quantum computing product versus the other ones that we've been talking about. HSBC, a giant bank use IBM's her quantum processor to improve its algorithmic bond trading. IT produced a 34% improvement in trade predictions. The irony of an old line company beating the pants off of its younger competitors. Although by the way, I point out that many of these younger quantum plays aren't that young. They've been around for a long time without coming up with something as practical as what IBM has already developed. Maybe IBM is the best way to invest in crypto in quantum and it's a mighty inexpensive stock. I spent a lot of time with IBM recently. I I wish we owned it for the Chapel Trust. Frankly, it looks that good. Honestly, I'm relieved to see these speculative stocks come in. I never mind. When the froth comes out of the market, we don't want huge gains and flailing crypto outfits. And we certainly don't want endless speculation instruments designed to double or triple the impact of a given stock or index on day. We don't want insider selling and we advocate investing right here, not trading. While the specs got hit today, the quality growth stocks and the bank stock performed well, so let today be the lesson this market needs to get back to planet Earth. We know the speculative excess of 1999 bled into 2000 and led to gigantic losses for pretty much everything. The declines were so great that many people never came back to stocks again. I'd say that it's not yet safe to get back in the speculative water. The shakeout today led to a bounce, but I don't know how realistic the bounce will be proving it. Well, it could prove to be that what's going on is that money's going back into quality stocks with the exception of health care, which is a disaster. But I want to make one point clear. My new book, okay, here I go. How to Make Money in Any Market, comes out next week. I'll be signing books at the Barnes and Noble at 55 at 5 by 5 Fifth Avenue next Tuesday at noon. In the book, I say that if you've got a diversified portfolio of five stocks, one of them can be speculative. But you got to speculate wisely. You can't just buy anything. You have to be sure that the company has an edge as well as a strong enough balance sheet to get the business where it needs to go. And you have to believe in the concept enough that you won't be shaken out if the stock gets hit, like on days like today. Even when you speculate wisely, though, I want to remind you that sometimes these stocks may never pan out. In the last few months, people have made fortunes, fortunes to speculate. If you're one of them, you can still take something off the table so that you're playing with the house's money. You can do that tomorrow. You'd be a fool not to. Speculation only works if you can work toward taking out your cost basis. When you do, you can let the rest run. But if you never take anything off the table, you'll never have any real gains. And speculative gains can always turn into real losses. I like to say, as always, the bull markets tomorrow, I promise you to find it just for you right here on Man Money. I'm Jim Cramer. I'll see you tomorrow.

[Legal Disclaimer Narrator]

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 the World Runs.

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