CNBC’s Jim Cramer on Tuesday warned viewers about the risks of relying on other people’s advice to invest in the stock market.
The “Mad Money” host suggests understanding your own investing goals and priorities before deciding to follow the lead of a big-time money manager, pointing to the bearish outlook and “terrifying statements” Bridgewater Associates founder Ray Dalio offered in January.
The renowned hedge fund manager’s then-assessments on politics, the economic cycle and Federal Reserve’s moves in monetary policy “was scary stuff that made you want to sell everything,” Cramer said. Nobody’s perfect and even the top investor often get it wrong.
“As it turns out, though, that would’ve been a great time not to sell but to buy. And when you look at Dalio’s flagship fund at Bridgewater, its performance in the first half was reportedly down 4.9% …,” he said. “And that’s fine for him: he’s already one of the richest men in the world, he will not miss it.”
“By all means, listen to these big-time money managers. Get your head into what they’re saying, take them seriously, but acting on their advice: that’s a sucker’s game,” Cramer said. “If you want to manage your own money, you can’t borrow someone else’s worldview. You need to think for yourself. Otherwise, frankly, you might as well just stick your money in an index fund.”
Catch his full thoughts here
Back to the 80s?
An employee delivers cases of Coca-Cola Co. brand soda in Miami Beach, Florida.
Scott McIntyre | Bloomberg | Getty Images
The consumer product companies are gaining momentum reminiscent of the 1980s, Cramer said.
Consumer stocks like Coca-Cola and Kimberly-Clark are performing as they did when the United States economy transitioned to a post-industrial one, which allowed a company like Merck to surpass Ford or General Motors in size, according to the host, who was was a stockbroker with Goldman Sachs and later a hedge fund manager during that decade.
The major averages all rallied as much as 0.68% during the session Tuesday and, aside from the run in the semiconductor sector, resembled the beginning of the “great bull market” of the 1980s, Cramer said.
“These consumer packaged goods stocks haven’t run that much versus the techs. They have incredible pricing power, vast untapped markets overseas and terrific dividends,” he said. “If I’m right that this is like the 1980s all over again, it means the likes of Coca-Cola and Kimberly-Clark have a lot more room to run.”
Read more here
Some made in China
Brian Goldner, CEO of Hasbro.
Ashlee Espinal | CNBC
Hasbro CEO Brian Goldner, coming of the company’s earnings report, appeared on “Mad Money” to discuss how the company plans to relocate production operations out of China and what goals he hopes to achieve.
“We do believe by the end of 2020 we can be down below 50%. I should say that 20% of our revenues do come from U.S. manufacturing,” Goldner said. “We’ve added India. We’ve added Vietnam, and we’ll continue to add new geographies and step up.”
Catch the full interview here
King of the snacks
Assorted products of Mondelez International.
Adam Jeffery | CNBC
Cramer crowned Hershey the “king of snacking,” but suggested that Mondelez International is the better buy of the two candy producer stocks.
With the former set to report earnings on Thursday and the latter slated for next week, the host said he thinks Mondelez has a stronger chance of rallying after results come out.
“The bottom line is that Hershey is the better company. That’s already baked into when it comes to their stock,” he said. “Given how much Hershey’s stock has run, I feel much more confident and comfortable buying the stock of Mondelez here.”
Go deeper here
Inside the mind of a shark
Scott Mlyn | CNBC
Shark Tank star and FUBU founder and CEO Daymond John, who gave his thoughts about investing in companies that have an impact on his life, brand management and the competitive advantage in starting a business.
Catch the full discussion here
Cramer’s lightning round: You’re not a pig — ‘This is not the level to sell eBay’
In Cramer’s lightning round, the “Mad Money” host zips through his thoughts about callers’ stock picks of the day.
eBay: “You’re not being a pig. You’re going to own eBay. It’s going much higher. It’s splitting up, bringing out value, doing better — this is not the level to sell eBay.”
Cloudera: “They’ve missed a bunch of quarters. I do not share your enthusiasm for that stock. It could bounce ’cause it’s so low, but they’re in a no-fly zone for me.”
Cadence Design Systems: “I liked the quarter. I mean the stock sold down $4 … but I liked the quarter.”
Disclosure: Cramer’s charitable trust owns shares of Goldman Sachs.
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