Cramer's 'Mad Money' Recap: Keeping Up With the Rally
NEW YORK (TheStreet) -- Fund managers are scrambling to keep pace with this market, Jim Cramer told "Mad Money" viewers Wednesday, and that will only help send stock prices even higher.
Cramer said, yes, the return of the individual investor to the stock market is helping to fuel the 2013 rally, but it's only part of the story. He said as these investors pile into index funds, it's also forcing hedge funds and money managers to put their money to work even faster just to keep up. As of right now, the big boys are well behind the curve.
Cramer explained that with GDP slowing in the fourth quarter thanks to fiscal-cliff concerns and Hurricane Sandy, money managers had no choice but to raise cash and play it conservative. After all, they couldn't afford a quick 10% haircut if the U.S. economy did indeed fall over the cliff. But when the worst case didn't happen, that left them chasing the rally as seller's remorse kicked into full gear.
U.S. stocks will remain desirable investments because the Federal Reserve remains committed to keeping interest rates low and thereby hampering the bond market. Cramer said that will make high-yielding dividend stocks among the hottest stocks around in the weeks to come.
In the "Executive Decision" segment, Cramer spoke with David Demshur, president and CEO of Core Laboratories (CLB) , a stock that's up 228%, including reinvested dividends, since Cramer first recommended the stock in August 2006. Demshur has appeared on "Mad Money" seven times to update viewers on the growth of his company.
Demshur said the renaissance in American oil and gas is only just beginning. He said production may be at 15-year highs but development in our shale resources has only just begun. Demshur also noted that the latest data suggest North America may have not one, but two additional shale regions yet to be discovered.