Cramer's Mad Money - AIG, Show Me the Money (11/20/08)

Stocks discussed in the in-depth session of Jim Cramer’s Mad Money TV program, Thursday November 20.

Cramer’s New Deal

 

Cramer thinks a sustained rally is impossible unless aggressive action is taken to reverse the current situation. Cramer says if he were “pulling Obama’s strings” he would advocate the following 8 point plan.

 

1. Obama should hold a press conference and declare the government’s commitment to saving financial institutions.
2. To prevent another AIG-style situation, the government should ensure the stability of insurance and annuities.
3. The government should issue tax credits for those buying homes and reform TARP so banks are not penalized for taking aid.
4. Freddie Mac and Fannie Mae’s bonds should be insured so the companies can function
5. Collateralized debt obligations or CDOs should be bought up to stabilize the market
6. The government should finance auto companies that file for bankruptcy.
7. China and Europe should be persuaded to cut interest rates 2%
8. Reforms should take place now, and there should not be a delay until Obama is sworn in.

 

CEO Interview: Andrew Littlefair, Clean Energy Fuels (CLNE)

 

Clean Energy Fuels has fallen along with the price of oil and on the fact the politicians do not seem to be jumping on the natural gas bandwagon. However, Andrew Littlefair says there is still a reason to be optimistic for the long term. Littlefair thinks the main reason Proposition 10 (which would have encouraged the further development of natural gas) was rejected in California was economic; that voters looked at their empty pocketbooks and simply felt they couldn’t afford it, not that they disliked the idea. While Cramer notes everything is down in this environment, he still thinks Clean Energy Fuels is a winner.

Sell Block, MLPs: The Good, the Bad and the Ugly- Kinder Morgan (KMP), Williams Pipeline (WMZ), Altas Pipeline (APL), DCP Midstream (DPM), Atlas Energy Resources (ATN)

 

Not all Energy Master Limited Partnerships (companies which are required return cash to shareholders in exchange for tax credits) are created equal. The Kinder Morgans of the sector are safe because they are involved simply in transporting oil. The MLPs such as Williams Pipeline, Atlas Pipeline and DCP Midstream which are involved in gathering and processing oil are unsafe, and cannot make money unless oil is at $75 or higher. Cramer admits he made a mistake recommending Atlas Pipeline. Cramer defended his bearish call on insurers on a Goldman Sachs report last week. While not all insurance companies are doing poorly, Cramer says it is a good idea to be cautious. 

Outrage of the Day: AIG (AIG), GM (GM)

Cramer asks “rogue bank” AIG to “show me the money” and to disclose what it is doing with the billions it received in its bailout package. There are some indications the funds were used partially to bail out foreign banks. Cramer asked,”Can somebody please tell us why it's OK to funnel money to foreign banks through AIG, but a terrible mistake to rescue domestic automakers? Where's the money?”

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Comments

[PeteK:]

Mr. Cramer,
Very excellent points. Well presented.
You should be working for the president.

2008 Nov 21 06:58 AM

[sstro:]

This won't be the only day that AIG becomes the outrage of the day. If and when they disclose where that money went the stuff is going to hit the fan. I bet both AIG and the ones who approved them getting funds will have a more then a little dirt on their hands.

2008 Nov 21 07:41 AM

[Spaceghost:]

The Alpha article has a mistake in it. Cramer was bearish on WPZ - Williams Partnership, Ltd - and NOT Williams Pipeline Ltd (WMZ).
WMZ is in the same business as KMP, a Cramer favorite. There are several Williams related companies so you need to be very careful
about which one that you are talking about. Please correct the article.
Thank you.


On Nov 21 06:58 AM Allears wrote:

> Mr. Cramer,
> Very excellent points. Well presented.
> You should be working for the president.

2008 Nov 21 08:52 AM

[jcrash:]

Article incorrectly lists WMZ instead of WPZ.

2008 Nov 21 02:28 PM

[xsuddensam:]

Yeah Cramer, show me the money.

Unlike many of us who opposed the bailouts, you were at the forefront screaming the loudest for them, crying that the world would end without them. Now you're complaining that the money has disappeared.

You jerk, you should have sounded the alarm before the money was given away!

2008 Nov 22 07:35 AM

[User 309460:]

I want to write a message to Obama and say that nothing is changing. The little guy that works the auto industry cant afford to put politicians in their pockets like giant financial institiutions. Thats why the government (that Barak wants to change, but has not expressed outrage) has not required a complete disclosure of this bailout money, also this is the reason the auto workers are hanging in the wind.
We elect government officials to work for us, but but they are not they are working for big money.

2008 Nov 30 08:21 AM

[Ceetian:]

Get your research right!! Cramer
You should know better, on your show 11/20/2008 your mentioned Flowers Foods had filed Bankruptcy in the past.
WRONG>>>NEVER happened!!!!

2008 Dec 02 06:59 PM