alphabet the business is growing nicely yahoo! >> positioning is so ultra negative, kohl's store >> that does it for us see you back here tomorrow at 5:00 for more "fast money" "mad money" starts right now 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 hope you find it. "mad money" starts now hey, i'm cramer. welcome to kw"mad money." welcome to cramerica other people want to make friends, i'm trying to make you money. my job not just to entertain, educate and teach you. call me or tweet me @jimcramer there are two universes and that is the only way to explain this market's behavior.
after a fabulous day where the dow gained 240 points, s&p advanced .82% and nasdaq climbed .90% i got to go there. i got to explain these universes. there is a universe with a booming economy then there is a universe with a faltering economy. one of them is a fantasy the other may be reality but occasionally they bleed into each other we can go everyone freaking out about a possible recession the market was down gigantically since then, though, we got a spade of incredibly positive earnings reports from a gigantic retailer like walmart, home depot, and now target and lowes so which universe is real? the robust one that we seen this week or the teetering one we visited, the one that had me on the today show urging people not to panic panic was the order of the day remember, panic is not a strategy let's dissect these universes,
please, because they are colliding here and in the end, we know there can only be one like the highland. the recession scenario that drove stocks down hard last week was about the bond market. long-term rates had dropped below short-term rates indicating a lack of confidence and the dreaded yield curve. this odd inversion precedes a recession, the sign of the federal reserve missed the mark. the feds caused many a recession. sometimes they do it deliberately, which was the proximate cause of the great recession. if you buy this logic, we're not really headed for a recession. there is no avoiding it. the reason, the global economy is slowing thanks in part to our trade war with china the president of the united states decided it's worth taking a short-term hit and means we can stop china from devastating american manufacturing, stealing intellect well property and spying it seems so reasonable, doesn't it the rest of the world is having
a tough time, the fed has been pretty clueless, tariffs are bad for commerce this line of thinking you can wrap a bow around the i'm pempeg recession so you better stock up on spam and velveeta to stock up that's run through but now let's consider what happened today where the averages rebounded back to where they were before the panic even as we hit inversion this afternoon. when you look at the causes, it's an alternate universe one smacks more fantasy. this morning started with earnings from lowes and target both were strong enough to confirm what we heard from home depot and walmart. the consumer is in good shape and getting smarter. the tariffs so far are not an issue. 10% increase next quarter is viewed as not an issue who can squeeze suppliers because they are powerful
how about price inflation, more like deflation traffic was up that's a sign the consumer is flush, and as the quarter came to a close, guess what the numbers accelerated. lowes made it clear contractors were spending more heavily because low interest rates will spur home buying or home equity lended renovations thank you germans. we have a faphenomenal labor market mortgage rates come down and talked about labor saving technologies that keep prices down i've been saying this for years. the tech is deflation nary. that's a reason jay powell can cut. as we have positive earnings reports, we heard a quick interview becky from the squawk and brian is the ceo of bank of america. their own ceo and said the long term -- he told us that our long-term interest rates have
plunged because of demand for u.s. bonds from overseas not because of economic weakness here at home, that's what i've been telling you if you're european and getting negative interest rates for owning 30-year german bonds, paying the german government to take your money, why wouldn't you buy some dollars and swap into u.s. treasuries, even at 2% the 30-year is giving you a much better return when you consider europe has a currency i wouldn't touch with a ten-foot pole because they seem to debase it the eurozone is a mess dragged down by commitment by austerity by any price but the weakness isn't hurting our economy meerks it it's pushing down rates. the only thing holding us back is the federal reserve refuses to cut rates to levels more in line with the rest of the world and the tariffs aren't having much of an impact. which universe is right? the one the bond market is forecasting a slowdown courtesy
of what we're importing from overseas or the biggest problem is finding enough workers in a red hot labor market it's funny i'd love to say the optimistic universe is most likely to prevail but the talking heads talk about how a recession is inevitable i heard it all day when because president trump isn't going and jay powell has trump called him a chowder head yet or is that tomorrow's tweet he won't cut interest rates fast enough, something the fed seems to indicate when released today. this e rorodes confidence and business pauses new hires and invest mtds that le investments. it's easier to spook people than build confidence, one of the reasons i don't like to do it. makes matters worse, the experts don't seem to care what we're hearing from a walmart or amazon or target or costco or home dedd depot or lowes.
that's your little thing they take the yield curve. that's bonkers sure, it's inevitable one day i guess we could have a recession, that's always true the question is when when the yield curve inverted before the great recession, it was the end of 2005. the stock market didn't peak until 2007, that's not elpful. what major retailers tell us, the consumer is in great shape, that's data. look at my watch that's right, my acronym for walmart, amazon, target, costco and home depot these companies canvass the behavior of probably every family in america, the ones that can't afford them go to the dollar stores and the trade war, lowes didn't get questions because the analysts were tired of beating a dead horse and marvin did a fantastic job congratulations. where do i come down i think we could still talk ourselves into a recession if
the president takes them on a trash talking wide receiver, they would actually learn to trade bonds. bottom line to borrow a line from ftr, we had nothing to fear but fear itself. it sores angry rhetoric and frightening jeremiah from experts that don't listen to conference calls because they believe they are irrelevant so the next time someone tries to make you panic, keep in mind theyprobably don't know what they are talking about bernie in more aryland, bernie? >> caller: boo-yah dr. jim. >> what's going on >> caller: go ravins, we'll see you tomorrow. >> oh. >> caller: thanks for your guidance and advice over the year, jimmy. i got to say you're a great entertainer and watching you every night really always puts a smile on my face thank you, my friend
appreciate that. >> thank you look, i have to entertain to get viewers. okay, i could just put people to sleep and i would have failed 14 years ago. what's going on? >> caller: the stock i'm calling about is 31% below the 52-week high. >> okay. >> caller: it has a good history of beating earnings expectations and expected to report increases on the top and bottom tomorrow they have chinese sourcing because they sell clothing, appliances and computers and the ceo and cco should shares over the last two months. >> okay. >> caller: jim, in light of the good consumer data we have and in light of the fact i'm a club member at this place, the parking lot is always full. >> right. >> caller: please tell me what you think of bjs wholesale club? >> an -- ex nay on the 2 dollar not what i want you to own
go up $3, costco go up $100. i love to choose the universe where the economy is booming, not faltering but the negativity thank you william sapphire are seeding enough fear to erode confidence but please remember, most of the time they don't know what they are talking about. "mad money" tonight, i'm talking to a ceo of a company that can offer real insight don't miss my exclusive with pay come and confused about the software, join the club. tonight i'm going over everything you want to know about and people are afraid to ask and shares are on fire thanks to digization trend as more companies store data in the cloud, see how it's banking on the move stay with cramer >> announcer: don't miss a second of "mad money." follow @jimcramer on twitter have a question? tweet cramer #madtweets. send jim an email to
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now that we got impressive numbers from a series of a high-profile retailer, wall street is calling down about the state of the economy they are going to the same s secose secular growth, the rise of cloud-based software i want to introduce you to a new name for us pay come software. this company got its start as a tech focus disruptor in the payroll space. we love disruptors but it's all sorts of human capital managemen managements. basically, they let companies replace a big chunk of the hr department with software the stock is up, are you ready nearly 1600% since it came public and why it could report another amazing quarter three weeks ago. just incredible. the stock has more room to run let's take a closer look with the founder and ceo of the software and learn about the company and prospects.
welcome to "mad money. good to see you. thanks for coming. your company has by far, not just, but by far the best performance in a category we talked about a lot how is that possible and how does it differentiate you from the competition? >> first, i'm a fan of the show. >> thank you. >> pay com we're transforming the payroll and hr industry through digitalization and transforming the way employers and employees use technology an example is if you look at the way employees use this technology, even four or five years ago, often times they had systems, multiple past words, emails, phone calls and what have you today they can have a direct relationship with the database like everywhere else in their life they don't call the airline and book a fight they don't email their bank to void a check nobody emails netflix to make movie selections and if they did, we would be still emailing
netflix to make a movie solution at paycom, we allow employees to have a direct relationship with the database and it's an easier experience for both of them and h.r. can remove itself out of the data transfer process and into more strategy rules. >> so the hr could be involved how the company is run >> exactly that and performance through learning management initiatives and especially as you tie that to our performance system within paycom you're able to align both goals for the company and employees and track performance and so, you know, as we do more for the employee, we're able to identify even more items that make it easier for both the employee as well as employer to increase performance and satisfaction for both. >> i think it's important because we've had other payroll
processing companies and they are excellent. they don't add the functionality. you keep adding great things last quarter you talked about the total adjustment market is growing for your business. tell us about that i don't think it's growing for other processers. >> so you've always had the payroll growth in total addressable market it was growing about 3% but what is really growing are the other hcm areas of talent management, talent al zicquisition, expense management and learning mana management and paycom has all of them as we continue to expand value proposition for the client, we've picked up other areas. >> how about legalization of pot? how about me too are you focused on those >> from the legalization of pot, how does it impact our own employee base and the employee base of our clients, maybe you would have some background check that you used to do that maybe you don't do as much of right
now. i don't know specifically how someone would use us to impact that we have to be mindful of the appropriate compliance and regulation -- >> i'm curious about it. we talk about cannabis on the show and i keep thinking state by state but if i ran a business, i don't want stoners i need to know what the process is that i could weed them out without getting in trouble with the law? >> i think you have to follow the law. >> right. >> that's what paycom helps someone do there is different laws in different states for that. >> right. >> and at the federal level you're still dealing with that i don't know we have a strong value proposition for specifically vetting out that particular issue, but we are very focused on the employee and that relationship they have with our clients. >> we talk a lot about the inversion of the year old curve on our network with the implication it's got to be bad for hiring you have your pulse on hiring. to me, the issue in this country
is still there are not enough workers. somehow the media made it so that there is -- we're about to be on death's door what's your impression from the clients where we are in the economy? >> i think the economy is strong i don't know that we're a great proxy for what's going on everywhere else. we're in growth mode. >> right but you have that great medium size that's the core of our growth in this country. >> it is we aren't really seeing a deterioration of growth in that area but, you know, we're waiting to see what happens. we've been through different cycles i mean, we've been in business since 21 years so we went through the 2002 recession, we went through the setup in 2004 for the 2008 recession and as a growth company, it just doesn't impact us as much as it might if we were more at a steady state. >> how did revenue growth accelerate slightly? 31.5% versus 29.9, we don't see
accelerating revenue growth? >> we're having a lot of clients actually come to us and especially we're getting a lot of referrals from employees, rank and file employees working at one company they go to another company used to the paycom experience it's difficult to go backwards in technology so often times we get brought in we're having more logo adds and more clients at the top end of the range and we've had an increase in retention for the first time we've moved from 91% that's strong into 92% last year and so all of that is really adding to our growth opportunity. >> you have a fabulous story and a to fabulous company and thanku for coming to explain it a lot of our people are interested in the software this service to human capital management and to payroll processing because they are all involved everybody works. that's chad richardson, paycom founder and ceo with amazing performance. now you know why "mad money" is back after the break.
when earning season ends, another begins we talk about the cycle wacky none standard physical year report of numbers like most of the cloud. if you've been paying attention for the past couple years, you know the cloud-based software is one of the hottest groups in the market sometimes stocks sell off like they did during the big market meltdown last year and after each quarter, they come back with a vennvengeance there is one problem, they are almost impossible for the layman meaning you or me. when you try to read december skrep -- descriptions of the business, they are a go-to market strategy scale. whatever unless you have a computer science degree, trying to
process this stuff is like bashing your head against a wall and that is really unfortunate you should never own the stock of a company you don't understand it's too risky you won't have a clue what's going on but the cloud names have been so spectacular that i hate for you to miss out, that's why tonight and tomorrow because there are so many, i'll give you a premiere on the best cloud-based software companies in plane english you don't have to go to stanford computer since tonight we'll start with one of the ones that reported we'll do all the ones that reported let's start with splunk. the numbers look good. for those of you that don't remember, it's one of the original cloud data analytics base, they take the unformatted, unstructured data thrown off by connected devices and show their customers how to learn things from it.
they turn digital trash into digital treasure no wonder the quarter is a blowout. the ceo is manager and in a business that's cutthroat, i've never heard a word that was bad. how about alteryx. basically, their technology, the platform doesn't care where the data comes from or going:it's g. it's a platform that's stunning but i want to chase these levels for a pull back for alteryx. next up there is service now one of the original cloud kings. here is a company in the business of creating so-called digital work flows in plain english service now software helps other companies automate all sorts of back office processes a lot of them run much leaner operations, another labor saving technology these are deflation companies. when they reported at the end of the july, the numbers were
better than expected and not good enough for wall street because the stock had run so much and got slammed since then it's continued to fall when we last spoke to the ceo, i thought he told a very compelling story i like service now at these levels and i'm not the on one. the stock upgraded and exploded higher up 4% today it has room to run, though how about twilio it's a close-based communication platform that sounds like total buzz word other software developers use capabilities like text messages and voice communication to the app. if you use lyft or airbnb you probably got a message enabled by them and they are doing something similar for call centers, replacing with a more flexible system to make it easy to automate with bots and voice responses. it's another fabulous company. i like these guys very much. great mr. jeff lawson i met with
on the floor with his family, new york stock exchange and said jeff, how are we doing he brings great joy to me. he's an original that taught me how to go someway. the stock is crushed by the recent market-wide turmoil that's crazy this story is better than it was a month ago. the stock fell from 147 to 131 during the period. that's why the travel trust is buying the small position, not big. you can follow it by joining the actionalertsplus.com club. i like it that much that we had to buy some shares i wish it would come down more and do more buying with twilio how about one people make fun of me because i say it all the time at office, at last is another communication software but rather than helping companies connect with customers, at last helps employees collaborate. slack stock is down.
shoot me i think slack is a good company. new microsoft teams chat is kind of like this the difference, the platform is designed to help software designers collaborate more efficiently, for efficiently and effectively. software development is the bread and butter the latest quarter was so strong that the stock barely got dinged in the big sell off down $6 from the all-time high and that may be the one problem that's seen stock is expensive i would not buy it at these levels but i wouldn't sell the position if you don't, wait for a pull back, it's fine. this one right here i like just so you know. this one right here i like i like this one. this one is too high and this one is too high. let's keep going this is the highest and the hottest of all called hub spot i've not talked about on the show it's about inbound marketing hub spot offers a free customer service platform, the hub where its clients can manage customer relationships and charges those clients money for additional products to help with marketing
sales and service. these products help ensure clients target the right customers and make marketing more targeted. hub spot's latest quarter was fa l no, ma' -- phenomenal it's too late to buy this one but if you can get a nice pull back, it's worth owning but if it did pull back, i bet someone would like to buy it every growth stock manager out there, hub spot. how about one that's stumbled recently, new relics new relics is problematic. they help clients make sure web pages and apps are working collectly. i don't know if you're on the mlba one constantly looking at it anyway, they have issues -- we beat the red sox last night. 3-2. as soon as they pop up, they can be fixed asap. great story. when new relic reported the quarter, it was tough.
it lost 29% of the value of the single day since then it kept falling it's lost more than half of the value. i'm a big believer in the ceo but we got to hear from him before we hear step up and buy new relic. here is one we had on recently it's hard to keep track of called 59. it makes cloud context center software basically, they are trying to make physical calls. people should be able to do this from any office or home more efficient. 59 is on fire. i do not recommend it. put it on your shopping list and wait for a pull back i thought they told an exceptional story. another one that told a great story. ring central that provides other companies with a cloud-based business telephone system rather than having the phone company wire your office, plug your phone into this internet how can i help you handles voice, video, messaging, collaboration and the software makes it easy for users to log
in with the same identity with multiple devices including their own personal phones. i wish they made logging into my fantasy draft a little easier because then my executive producer wouldn't be sweating the program. they don't do that the latesta favorite of heather gains who works with us who knows more aboutthese companie than anyone i have ever met. zendesk. think of it as a baby sales force. when you call them on a problem, the platform makes it easy for support reps to answer questions by text or phone and heather is always telling me please do not confuse it because they are different lately, they have been moving into data an will talytics. when zendesk reported the latest quarter, they met expectations and the stock got slammed.
the good news, they seem to put on a bottom and i would count as buying right now finally, there is appian they help other companies develop software companies they are low-code development. their platform makes it easier for programmers to make tools without doing a lot of coding. the stock is elaborate but in the last few weeks, one of the best performers because the latest quarter was so fantastic. over the stock more than 50% in less than a month, i don't know. all right. the bottom line, too many people are missing out on the great gains and these cloud stocks okay too many look, we had that splunk had 11 dirty dozen, big ten 11 football players 11 on the team now it's not a baker's dozen that's 13. it's 11. it's a gridiron. anyway, these are cloud plays that now you know what they do when you're finished with a
tut tutor l, if you understand what the underlying companies are about. i would call it the idk. someone will steal it and make a fortune and i'll sit here crying in my beer which by the way is not going to be an ipa let's go to paul in colorado, paul. >> jimmy, thanks for taking my call. >> of course >> caller: i want too give a big boo-yah from denver, colorado. >> okay, go broncos. i don't like the way freeman -- we have to do work on that what's up? >> caller: all right so i'm not crazy about the cannabis stocks out here in denver but i am interested in a stock called z scaler. >> who isn't interested in z scaler i mean other than software people zscaler is like crowd strike that's built for security. it's terrific and one we had on
what do you do when a long-term story falls apart before your eyes the data center is one of the hottest secular stories around as more and more companies migrate to the cloud that led to monster gains including real estate investment trusts that rent out space in the high-tech facilitiefaciliti warehouses for servers to companies that need more computing power. we heard murmurs and the stocks got obliterated. the long-term story was in tact. it sounded like it never went
away the group started rebounding with equinix leading the way let's dig deeper with charles myer, the new president and ceo gets a better read welcome to "mad money". >> thanks, jim, wish i could be in the studio with you there today but appreciate you having me on shot. >> i'm glad you're on. you're the man of the hour we've been listening to semi conductor companies and analysts tell me the data center story slowed maybe it comes back next year. i look at the numbers and say that's just not true. >> we agree. you know, i think we continue to see a really strong set of underlying sec cular demand drivers for the business and seeing real strength in the business globally right now. >> how much of that is because this is not a commodity business and offer features the other guys don't and how much of it is that amazon, google, microsoft
and oracle continue to get a lot of customers and need to expand? >> it's a little bit of all of them i would say broadly we've seen the sector, you know, respond very well. we think there is a very deep demand pool for data centers broadly but i do think that equinex plays an important role in the market and out perform relative to the peers. some of that public cloud adoption is a major catalyst and every one of the providers is a significant customer and partner of ours and enterprises are adopting public cloud and looking at multi cloud as their arte arte architecture of choice, we're seeing high demand. >> we've been big supporters of sales force over the years they are a tech company involved with you and everyone is using netflix. how do they connect? >> yeah, i think we're one of those -- we may not be a household name but safe to say we're probably impacting the
lives of many of your viewers on a day to day basis working with those customers. we play a very important role in terms of inter connecting our customers sometimes to public cloud providers, sometimes to software service providers like sales force, suspects to other members of their supply chain and networks that's really a big part of our legacy and history has been enter connecting people to networks so the enter connection story is a really central piece of the story. >> both chuck robins frequent guest on "mad money" and jenson, cisco and invidia, they have substantial edge computing businesses where do they lie? >> yeah, i think right now we often talk about the fact that we believe that equinex is the best representation and that is the point at which people are ent inter connecting their
infrastructure and members with the supply chain when you hear about edge, you know, often times that edge is in fact within an equinix facility and private inter connection facilities. >> so if i go into one of your facilities and you have them, would by able to tell, is it all the different clients or google ran out an entire equinix google the cloud? >> inside of our facilities, we're a little unlike some whole sellers which might have one or very small number of customers we tend to have a larger number of customers than any individual facility and they are distributed across the site. typically in private cages or sometimes in shared cage environments or shared rack environments and have their equipment there, very secured and, you know, something that's available just for them to
access but they are all across the facility you wouldn't be able to see who the customer is because they are very sensitive about that from a security standpoint but all across the facility. >> okay. you've got big business in asia pacific. 20% is asia pacific and you've got 32% in europe. you got a good view on trade i sense there is more fear than there is actual slowdown in business but maybe i'm wrong what's your take >> yeah, i think that's right. i think we're seeing right now continued strength across our business because people are prioritizing digital transformation as what a way to gain advantage and people are responding well to that and thriving and people not are being left behind. so we're seeing strong demand. you know, i think the tensions, trade tensions et cetera probably affect some level of sentiment but we have not seen that impact the demand profile for our business. >> last question, when i see your big cloud oracle,
microsoft, google, that's microso microsoft, google, but i see your customer is walmart that's a company we're just gigantic fans of is walmart so big they actually have their own actually have their own capacity and don't necessarily just use goggles or microsofts >> sure, in fact, i would say that's true of manyie doing is . they have private infrastructure in a caged aenvironment and housing workload so that hybrid multi cloud environment is the architecture of choice for enterprise customers of all sorts and retail is an incredibly strong segment for us but that architecture of choice is a mayor driver for the business. >> i'm glad you say that we think retail is much stronger than people are saying
i notice you're down to 1.78 yield. this is not as rate sensitive as we used to talk to equinix it's a great story. >> with treasuries hovering at 1.55, i think people looking for yield and simultaneously playing for growth, it ends up being a powerful story. >> i couldn't agree with you more thank you, great to have you on. that's charles myers, president and ceo of eqix. thank you, sir >> thanks, jim. >> stick with "mad money." we're pretty different. somos muy diferentes. muy diferentes. (vo) everyone in your family is different. that's why verizon now offers more plans to mix and match so everyone gets what they need without paying for things they don't. new plans start at just $35.
it is time, it is time for the lightening round, buy, buy, buy, sell, sell, sell. then the lightning round is over are you ready ski daddy? time for the lightning round andrew in illinois, andrew >> caller: hi, jim i'm andrew's grandmother and we've been watching you since he was a little tiny baby he has a question for you. >> sure. >> caller: boo-yah, jim.
>> boo-yah >> caller: my name is andrew i'm 8 years old. i train with my granny i like trains and my stock is union pacific. >> well, i got to tell you, andrew, you have horse sense it's a terrific stock. get your granny to maybe put a little money away for you in that stock because i think that's a long-term great situation and thank you and thank you granny for watching. let's go to trudy in illinois. >> caller: jimmy, big boo-yah to you and yours. i'm down half the value in pmy portfolio. >> i don't like teva it's great opportunity to let go that's my take that's a two-for let's go to sue in michigan,
sue? >> caller: mr. cramer, we think you're awesome. >> thank you >> caller: so i'm your typical baby boomer that worked 40 years and i'm thinking about jumping off the retirement cliff i know you're going to rake me over the coals 17% of my portfolio is in pfizer stock, preferred common and i reinvest the dividend. >> okay. fa fiez ser disappoi pfizer is disappointing. i continue to believe merck is going to go higher and i think pfizer could bounce here but i think you got to let it go they don't have the pipeline that i'd like them to have i prefer abve. let's go to linda in my home state of new jersey, linda. >> caller: hey, jim, how are you today? >> good. how about you? >> caller: doing well. thank you so much. my stock and i'd like to hear your thoughts on this is abm industries. >> i like that company
i've liked it for a long time. it's just a kind of very sleepy, consistent, facilities contractor not unlike air mark that looks like it has some, a little let's see uncertainty going there. i'll say yes to abm. let's go to randy in california, randy? >> caller: jim, schlumberger is best to breed, what about the oil tankers? >> don't touch the oil tankers i'm choking on that schlumberger fracture i don't want you anywhere near my house of pain let's go to jeffrey in california, please, jeffrey? >> caller: hey, how are you doing today, jim >> doing well. >> caller: i am doing incredible i'm so excited because you were 1,000% correct when you said months ago to my tons of nayx. my two favorite stocks i more than doubled my account when i bought over 20 k three hobl months ago they have gone to the moon and never pulled back and i keep buying more and more and they
were up about 5%. >> which stock do you have now >> caller: there is actually something i found a lit ever tl better than ayx. pa -- >> it's payment processing i can't -- it's up a lot i can't bless brazil i'm sorry. i have a lot of relatives there. that, ladies and gentlemen, is the conclusion of the lightning round. >> announcer: the lightning round is sponsored by td ameritrade ♪♪ ♪♪ ♪♪
. what does it mean when target shoots up 20% or lowes? did something change did the economy shift into over drive? no, not at all these stocks would have gone up no matter what because they delivered fantastic upside surprises but having such massive moves because they are parts of gigantic short squeezes too many managers bet against them and today the bets went very, very wrong at any given time there are hedge funds making bets. that's how they try to beat the performance of the averages, which is what investors pay for. many of the hedge funds try to merge the perspective with a bottoms up company specific approach along with an in this case t ans you are supposed to have the wind at your back and hedge
funds believe the wind is blowing toward a recession which means retail is particularly vulnerable. they clearly got ahead of themselves just look at lowes versus home depot. the managers decided to take a paired position. they went long home depot and short lowes. this is a way to bet on performance of companies honestly, it made sense if you look at the last quarter, lowes was wanting and if you listen to the good home depot call from yesterday, it was easy to believe they must be taking tons of market share from their main competitor when lowes reported this morning and shot the lights out with strength across every isle, that paris trade was blown. traders know that discipline trump's conviction is a rule if a trade goes against you, you have to get out, which in this case means covering your short positions at any price that's how the stock surged up 10% today. discipline short sellers bought back stock to close out their positions and take the loss and
catapu catapult target has a different set of circumstances. there was a two-fold case. the bears argued they couldn't compete and argued target would be hurt by the tariffs because they import so much from china i had suspicion it would be a terrific quarter which is why i included target in my watch acronym of retailers the new stores are fantastic and china relies over blown and shipt same day delivery system is superior to everything and those were enough to blow away any of the concerns. the results were spectacular, the stock caught fire. target was a totally wayward short that was dead on arrival so the cover ever coving began e opening this morning and that's how you got an amazing run and all the macro-oriented managers look like dopes. they thought we were facing head winds but really this economy has a strong tail wind and there are other reasons for inverted yield curve. there is invidia
the semi conductor company who had a serious quarter. they told us products were too early for their time like the chips that enable racing or in the thick of data center which wall street panicked about last year and you just couldn't see the results that they thought they would get but when invidia reported, they told a different story. data centers strong. companies and artificial intelligence are the hottest pieces of silicon out there and they are a real good short 280 but became a nightmare short of 180. it's got more room to run, maybe much more room defeated short sellers are great fuel for exaggerated moves i don't like to bet against the short sets since they know more than we do but when a shortage is crowded and wrong, you can rack up enormous gains which is what we saw in lowes, target and invidia. stick with cramer.
that's what happens in golf nothiand in life.ily. i'm very fortunate i can lean on people, and that for me is what teamwork is all about. you can't do everything yourself. you need someone to guide you and help you make those tough decisions, that's morgan stanley. they're industry leaders, but the most important thing is they want to do it the right way. i'm really excited to be part of the morgan stanley team. i'm justin rose. we are morgan stanley. i like to say there is always a bull market somewhere and i promise to help find it for you. i'm jim cramer see you tomorrow
[tires screeching] >> flags are up. [screaming] >> hi, i'm jay leno. all: hi, jay. >> hi, everybody. how you doing? and this is a show about cars. it's fun to drive cars that are really different. >> this one's a death trap. >> oh, i see, because-- >> because it's dangerous to ride. >> and motorcycles, and well, anything that rolls... like driving a two-story building. oh, my god, strong as an ox! explodes... i love the smell of napalm in theorning. yeah! or makes noise. >> you ever run a dragster? >> no, i haven't. [engine revving] this is "jay leno's garage." >>ta