Cramer's 'Mad Money' Recap: Housing Comeback
Cramer said the same things that have made these companies a success over the past three years still hold true today and are proof positive that someone with no knowledge of stocks can pick better names than professional analysts.
Lightning RoundHere's what Cramer had to say about the stocks that callers offered up during the "Lightning Round":
Hewlett-Packard (HPQ) : "Wow. I don't like that stock at all. That stock can go lower, much lower."
Pan American Silver (PAAS) : "It's the best house in a shaky neighborhood. I don't want to own any miners, they're too dangerous."
Hercules Offshore (HERO) : "This is a dicey stock. If you consider it a speculative stock, I'll bless it as a long-term bet on oil."
Prudential (PRU) : "They don't have yield protection, which makes me nervous. Be very careful, but I like it."
Zipcar (ZIP) : "The stock is down 25%. It hasn't seen a bottom yet. Let's look at it again between $6 and $9 a share."
Chesapeake Granite Wash Trust (CHKR) : "I don't want to own it right now. I think you can buy it lower."
Deere & Company (DE) : "It's a good company but the commodities are weak. I want to be careful."
Off The Charts
In the "Off The Charts" segment, Cramer went head to head with colleague Tim Collins over the health of the markets using the CBOE Volatility Index (VIX) , commonly known as the "VIX", or sometimes the "fear index."
Looking at a weekly chart of the VIX, Collins noted that it has patterns of spikes to the upside that correlate with market downturns between 5% and 10%. Looking at the VIX's recent action revealed an eerie similarity to the market downturn in early 2011.
Collins research called out the Relative Strength Indicator, or RSI, the stochastics and the CCI, or Commodity Channel Index, as all pointing to a coming upturn in the VIX in the near future, exactly as they did in early 2011. Additionally, the daily chart of the VIX also displayed a bearish "W" formation, further confirming the trend.
Cramer said that in today's markets, investors need to use every tool at their disposal, thus the technicals are warning investors to be more cautious going forward, as another 5% drop to the downside could be looming. "Keep your eye on the VIX," Cramer concluded.