Play Video Cramer Remix: Friday's rally may not be sustainable
Friday's volatile trading session may have helped stocks pare their losses from earlier in the week, but CNBC's Jim Cramer said it would take more than a market rally in China to mount a sustainable recovery.
"When the stock market falls as hard as it's been falling for the past week, it doesn't take much to give us a bounce," the "Mad Money" host said. "But, listen, we won't get [a] sustainable rebound until it's based on something domestic, something here, which is why we had that intraday sell-off before the late-afternoon bounce."
And the concern that initially spurred the sell-off — the idea that the Federal Reserve's policy could cause an economic slowdown — was still very much intact among investors, Cramer warned.
With that in mind, he turned to his game plan to lay out how investors should look at the week ahead. Wall Street will get a flurry of earnings reports from major companies including Bank of America, Netflix, Johnson & Johnson and more.
Click here for the full game plan.
Watch out, 2019: Here comes the Fed A runner passes the Marriner S. Eccles Federal Reserve Board building in Washington.
The stock market could be "headed for big trouble on the earnings front" next year because of the Federal Reserve's plans to hike interest rates three times in 2019, and Cramer is sounding the alarm.
"Three lockstep rate hikes next year will slow growth, boost the dollar and make people feel less wealthy. That is a fatal cocktail, one that makes it very difficult for most companies to raise their forecasts," he said on Friday.
"The Fed's determined to keep tightening, and if we get the promised rate hike in December followed then by three more rate hikes next year no matter how weak the economy might get, I'm betting that will [be] an accelerant to what could be a serious economic slowdown," Cramer continued.
And while he insisted that this market situation wasn't the same as in 2007, when the Fed's lockstep rate hikes brought the economy to the precipice of a major recession, he was worried about the effect the current Fed could have on stocks.
Here's his full take.
Cramer's post-earnings take on JP Morgan Chase Jamie Dimon, Chairman and CEO of JP Morgan Chase.
As the stock market processed the big banks' earnings reports on Friday after stocks pared their earlier losses, Cramer was doing some processing of his own.
In particular, the "Mad Money" host was considering J.P. Morgan Chase & Co chief Jamie Dimon's comments on the bank's post-earnings conference call, in which he warned of potential geopolitical turmoil weighing on economic growth.
"If rates go up because you have inflation, that is not a plus. That is a bad thing," Dimon said. "So far, we still have a strong economy in spite of these increasing overseas geopolitical issues bursting all over the place."
For the longtime banker, "Brexit, Italy, trade, reversals of [quantitative easing], Turkey, Argentina, Saudi Arabia" all posed potential threats to the welfare of the global economic layout.
Even though Dimon's comments weren't as negative as some other voices in the market, Cramer was surprised how things had changed since his interview with the J.P. Morgan chairman and CEO in late September.
And while Dimon's message was "not encouraging," it didn't make the stock of J.P. Morgan any less attractive, Cramer said.
Click here for Cramer's analysis.
Canopy Growth CEO on DEA approval, opportunity for cannabis Bruce Linton, CEO of Canopy Growth Corporation
It's no secret that the world is growing accustomed to the business of cannabis, but for $9.6 billion Canadian medical marijuana producer Canopy Growth, the future is approaching faster than many expect.
On Tuesday, Canopy — which has gained traction on news of several-billion-dollar investments from Corona parent Constellation Brands — announced that it had shipped cannabis to the United States from Canada for medical research, a milestone in the U.S. government's acceptance of what it considers to be a Schedule 1 drug.
"Under [Drug Enforcement Administration] approval, we shipped, for the first time, legally — and I highlight 'legally' — cannabis from Canada to the U.S," Bruce Linton, the co-founder, Chairman and CEO of Canopy Growth, told Cramer.
"The DEA-approved partner, which we haven't announced yet, can actually begin to do medical research, clinical trials if necessary, [and] create the data set that enables people to know when, what, where, and maybe it can become federally regulated in the U.S. with some input that way," Linton said in an interview on "Mad Money."
The CEO also said that cannabis could disrupt some $500 billion worth of global markets. For more on why he believes that and Canopy's opportunity in the market, click here to watch and read about Linton's interview.
Okta CEO on helping 5,000 customers digitize, beat Amazon Todd McKinnon
Cloud prince Okta has caught Cramer's eye with its monster year-over-year growth, so on Friday, Cramer touched base with its co-founder, Chairman and CEO, Todd McKinnon, to hear about how business is expanding.
McKinnon, whose software and cybersecurity company boasts over 5,000 clients including high-profile names like Major League Baseball, said that Okta's secular tailwinds — drivers not pegged to economic trends — are threefold.
First, "every organization is using the cloud to make their workforce more productive, rolling out the best tools, best technology," the CEO said. "Second one is every company in every industry is figuring out how they can use the cloud to be the Amazon of their industry before Amazon becomes the Amazon of their industry."
"The third one is that, when you think about workforce productivity and being a digital company, it's all open and more connected, but it's also the security risk and the opportunity to have better security is more important than ever," McKinnon said.
Okta helps companies do all three, the CEO said. And for investors concerned about the company's negative operating cash flow, McKinnon offered some reassurance.
"The main thing we're focused on given these big secular tailwinds ... is reaching the most amount of customers and providing the most value in the fastest time possible," the CEO said. "That's growth and that takes investment, so we're investing heavily to help these customers, to innovate, make sure our products are broad and deep and capable and make sure we can have the sales and marketing to go after these customers."
Click here to watch Todd McKinnon's full interview.
Lightning round: Don't get down on DWDP
In Cramer's lightning round, he zoomed through his take on callers' favorite stocks:
DowDuPont: "I think you should [buy shares] right here. I think [CEO] Ed Breen's being underestimated. I know a lot of people are very worried that this industrial is actually getting hurt. I think it'll do fine. It's going to split into three companies. I would pull the trigger right here because it's that cheap. It's come down a lot."
Blackstone Group: "Blackstone's very good. The fact that it's come down does not make it bad, it actually makes it more attractive. I think Blackstone is worth owning."
Disclosure: Cramer's charitable trust owns shares of Johnson & Johnson, J.P. Morgan, Amazon and DowDuPont.
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