Mad Money w/ Jim Cramer 03/25/25
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It's time to make America affordable again. It's time to support the President's plan. There's always a homework in somewhere, and I promise to help you find it. Mad Money starts now. Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. I'll be your friends. I'm just trying to make you a little money. My job is not just to entertain, but to educate, teach you.

Really figure it out together. So call me 1-800-743-CBC. Now there comes a time when you just don't even want to defend an investment idea anymore. It's just too tiresome. It's too painful. But if you think it's right, if you think it's a long-term winner, then you shouldn't stop.

And that's how I feel about the data center story on a sedate day where the Dow inched up four points, as it be advanced points, one, six percent. But then I said the game point versus every day. I feel like I do battle inside my head, let me in my head. Worry about whether it's sustainable for the tech titans to keep spending fortunes to build out the infrastructure for AI. I worry about.

Because of things like what happened last night when Joe Tsai, the chairman of Alibaba, and an executive I have tremendous respect for, talked about the, quote, astounding levels of spending on technology-related goods. He went on to say, I start to see the beginning of some sort of bubble. Bubble! Bubble! Bubble!

This man has great vision. I was sick to my stomach when I read these comments. I knew they'd be picked up all over the place because Joe's a well-known character, recognized for his savvy nature. I figured he could throw cold water on the entire data center gang, and that's exactly what he did. The stocks were down long before the get-go as this group trades all early morning. You could just feel it. You could hear it. I was thinking, I don't know, bubble day.

Double, I don't know, toil and trouble. You know, it's frightening, okay? Bubble, bubble, bubble. And you know how it just seeps into your consciousness? And that's why I want to retire that word. Instead, talk about whether it's a capital expenditure boom. One that might go bust, but it's a boom. It's not a bubble.

We've had some big capital expenditures booms over the years. Deutsche Bank recently put out a truly stupendous piece of thematic research about capex booms and busts. The report talks about the 18th century canal build-out, the 19th century railroad mania, excuse me, Apple, the 20th century real estate explosion, and the dot-com and telecom bubble, all of which ended with incredibly heavy losses.

But there are other capital expenditure booms that didn't go bust. The interstate highway system, the post-World War II Marshall Plan, the electrification of economies around the world, nuclear power, renewables. These were all fantastic themes, and no one ever called them bubbles.

They all turned out to be worthwhile, but they were started by the government, not the private sector, where we were left with a legacy of greatness, but not a lot of profit from it. Now, I think people like Joe Tsai look at the AI capex boom and figure it's a big bust for Microsoft's co-pilot, ChatGPT, XAI's Grok, Alphabet's Gemini, as well as others like Anthropic, Claude, and Perplexity AI. After all, it does feel like the dot-com bubble of the late 90s, and I lived through that. I get that.

Lots of similarities. So many companies involved look like Netscape or Infospace, MySpace, GeoCities, America Online, all barges destined for the scrap heap.

But most of these private sector capital expenditure booms did have a handful of winners. Let's not forget that the dot-com boom did produce a couple of incredible companies, Google and Amazon. And there were a few others that actually worked. Priceline, now Booking Holdings. Sure, a lot of companies took up by the wayside. But Google, Amazon, and Priceline were visible winners that never looked back. And they made you a fortune. Right now, at this very moment, you have a handful of companies all vying to be winners in the chat slash agent space.

They love to win, but more important,

they hate to lose so yes josiah is right the data center capex boom could turn into a trillion dollar bus or maybe even a multi-trillion dollar bus but that's only for the losers the winners could make out like bandits so ask yourself do you think that alphabet can afford to become a miracle online can microsoft afford to be a yahoo powered chat bot can you imagine xai's grok as alta vista or meta platforms having one of its platforms turned into myspace

That's one way to look at it. But it's only relevant if this is a typical private sector boom. And I don't think it is. Historically, the private sector booms, according to the Deutsche Bank piece, were financed with debt and stock issuance, way too much debt. In this case, the companies involved are all basically incredibly well-financed nation states with unlimited firepower. Lots of times I feel that it's winner take all, losers take none. But what if we're looking at these generative AI platforms and agents in a way that's too static? Or maybe I am. What if

there are so many uses once you build the thing that it's stupid not to do so. Which brings me to Jensen Ma, the CEO of NVIDIA, the biggest winner from the gen of AI infrastructure build-out. Because only NVIDIA's chips are strong enough, smart enough, and fast enough to develop things that we haven't thought of yet, or things that sound like total science fiction. NVIDIA chips will be vital to make these designs come to life. And we don't even know what those designs are yet. I want you to listen to this. It'll tell you what I mean.

You were talking about we need an amount of computation that's easily a hundred times more than we thought, so far so good, last year. Were we that off last year? Yeah, we're way off, yeah. We were, we didn't see it. We just didn't know how important it is. Well, we realize that reasoning is very important to intelligence. And we realized that one-shot AI that we were using wasn't representative of intelligence and that we were going to make incredible progress.

And last year, with reasoning models coming out, Chachi PT's reasoning model and others, and it just took off. Intelligent factories took off. We didn't even know you could have them. And now they're huge. Do you think that the companies buying these chips don't know what they're doing? It's the opposite. They're trying to play a part in the next industrial revolution. There may be money to make for everyone. Maybe beyond even anything that Joe's side could imagine.

These data centers can become the brains of autonomous vehicles. They can be used to run chatbots at a speed that you can't even see. They can run robots that can do anything that we can do, but better. It's just too early to find out the winners because everything's so new and we don't know what these companies are really working on. When I was at GCC, the Woodstock of AI, I saw things I didn't even think were possible. More important, I saw things I'd never imagined. And that's why I don't think it's a bubble. The use cases are just too great. I'll let Jensen do the talking.

Believe me, owning Nvidia has become a heavy burden for me. It seems to be at the epicenter of the so-called bubble, which is now why it sells at just 26 times earnings. And by the way, that's a true sign that people don't believe anymore. Nvidia's current valuation basically says that Josiah's right. The bubble is about to pop.

But let's think about that. When I was in GTC, I saw robots that looked like humans, which makes sense because they have to be able to reach and bend and pivot like we do. But unlike us, these run on computing power supplied by Nvidia chips. When they figure out everything we do by ingesting video, they will clean the table, rinse the dishes, load the dishwasher, run it, put away everything, and then vacuum before going upstairs to clean your bathroom.

You'll probably want to rent these robots. The oligarchs will probably own dozens of them. They'll probably have some Chinese ones, too, because the Chinese are still spending a fortune on AI hardware, except using inferior chips from NVIDIA because they can't get the best ones. Believe me, they would love to get the so-called bubble going in China. So I cling to my positions all day long, look at my travel trust portfolio, and I stick by my guns.

This might be the boom that doesn't go bust because the players are so well capitalized. It simply doesn't have to end that way. In some ways, I'm glad to see these sunshine Patriot stockholders get a new leave so we can get a new clean slate of investors in these stocks. But the bottom line, if you're any of the hyper competitive tech execs involved in the space race, you know what's going on. You hate to lose and you won't let it happen. After all, how do you think they got where they are in the first place? Chase in New Jersey. Chase it.

Jim, a big booyah from Auburn, New Jersey. Fantastic. Welcome aboard. What's going on? Thank you. Jim, last month we had the heat going here in New Jersey, and we went down to visit my son down in Florida, and we had the AC cranking. My wife Andrea said, why don't you look into some HVAC stocks? Jim, your thoughts on train technologies? TT. TT is absolutely terrific. We had them on the show. They really know what they're doing. I like them. Give you a twofer. You mentioned Florida. West Palm, that is right where Carrier is. Dave Gitlin, both stocks are excellent.

I wish I had more time. You know what? I let that sot run too long. That's TV talk for Jim Cramer. Jim Cramer's an idiot and overrode everybody who didn't know what he was doing. Okay, okay. There's a lot of... Hey, come on.

Come on, I'm allowed to do that now. It's our 20th. There's a lot of negativity surrounding the data center build-out, but maybe this is the boom that doesn't go bust because these top players are so well-capitalized and they're run by such smart people. I'm Anthony Tornay. How could AI and automation shape the cyberspace? I'm checking in with Paolo Alto. You're the CEO's take on the future of tech. Then I'm giving you another stock to watch that's had some success in the tough market.

I'll tell you the name and the reasons for its run-up. And later, don't miss my sit-down with international paper top rest. It's a changed company. I'm seeing if the company couldn't have even a broader look at the state of the supply chain. So stay with Kramer.

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Last week, we went out to NVIDIA's GTC event. That's the Woodstock of AI, where we learned about how all these sorts of businesses are using artificial intelligence. But businesses aren't the only ones putting this work, this tech to work. I got to tell you something, hackers are doing the same thing. See, they can use AI to expose sensitive information in record time. This is terrible.

So how the heck can companies protect themselves from AI-empowered crooks? Earlier today, we sat down with Nikesh Arora, the chairman and CEO of Palo Alto Networks. The company rang the closing bell at the NASDAQ celebration, 20th anniversary. Take a look. First, Nikesh, congratulations, 20th anniversary. You are in a tough business. I think it's a bit of a wonder that you've been able to stay on top of the game. How can you do it? Well, Jim, first of all, thank you again. Nice to see you.

Yeah, you know, cybersecurity companies have this property that they don't last 20 years very often. So we're delighted it's our 20th anniversary. We're delighted that we have both the opportunity to serve our customers the way we were able to and we have a great company. So couldn't be happier. Well, I think that

through this period, you have companies that are just starting. Let's say I start an enterprise, 1,000 people. What would you tell me to do if I came to you fresh versus a company that's legacy and got all sorts of systems and who knows what they're going to be hacked by? Yeah, as a customer, I would tell you that

With the advent of every wave of technology and now we're seeing this big AI boom and you've been talking about it and everybody's talking about it. The one thing that is a constant is your attack surface continues to expand. Now people are going to find ways to get into your business using AI hacks or hacking your AI implementation as they would with your cloud implementation in the past. So I think as the attack surface continues to expand and technology allows us to go at things much faster,

The bad actors, unfortunately, use the same techniques. So you have to make sure you are able to protect your crown jewels and find the bad actors in your system in real time. You've been using this great example of hijacking the agent in Waymo.

I mean, tell me about that because that to me is one of the most frightening things that I can think about. Well, we all like the new conversation and the new conversation is agents. AI is passe. ChatGPT was interesting one year ago. Now it's about getting agents to do things for you, whether you're an enterprise company or a consumer company. The way I see it is agents is like giving AI arms and legs.

and saying, "Go do something for me." - Right. - You know, you took the brain, which is really smart and help you figure stuff out, and you can write sonnets and have, you know, Idris Ijde Shakespeare back to you in your funny accent, but...

Giving it arms and legs is kind of the next frontier. And people say, well, that's not going to happen. We're going to manage it. We're going to control it. I'm like, it's already happening. Look out there. You get into Waymo, you just gave AI arms and legs. You let it decide where to turn, when to stop, how fast to drive, and how to get you from point A to point B. Now imagine if the same thing applied to robotic automation substations.

dams, if you start letting agents manage critical infrastructure, you've got to be very sure that those access points are protected because over time there'll be less and less human intervention, human supervision, in which case you need to be more secure. Well, you talk about that period where you put something in and if you do it wrong, you're dead. But you also use a great term. You call it the technological debt that has not been paid. We just come up with that. I love it.

Well, think about it. If you look, the average life of IT infrastructure is 10 to 12 years old. And we spend about a trillion dollars a year. So think about it. All that money that's spent is sitting in a whole plant. We can't change the whole plant on an annualized basis. So it takes seven to 10 years to change your technology plant.

And that's the time you're sitting on legacy infrastructure, legacy debt. You can't take it away. So as you evolve, as you get your technology to be more and more in line with the cloud, in line with mobility, in line with AI,

It gets better, but you're still sending us stuff that's 10 years old in infrastructure, which was never designed for AI to appear or the cloud to appear. Well, is that what the federal government has? Some people feel that Doge is a threat to you. I think they've got all these systems that you actually could come in and save the government some money and also save it from the bad actors who can get in between these things. Well, you know, the government has been slow to adopt technology because they're trying to make sure that

Before they go to the cloud, they suss everything out. And I think one of the biggest opportunities as we get through the phase of cost cutting is automation and efficiency driven by technology. So I expect the only way Doge will be able to get where it wants to get or we can get to a much more efficient, lower cost operation is to automate a lot of stuff. Well, you suspect. Have they been in contact with you? Well, we have talked to various parts of the government about stuff. Remember, it's early days. It's only been...

a few months i want to see you win business my charitable trust has a big position in your stock for heaven's sake i am very optimistic about the potential for technology and cyber security as we get through the early months of this unsettling period we're trying to figure out what the right path forward is from an automation perspective but i think their heart and souls are in the right place they're trying to do the right thing for the country i think they're trying to have us be a much more efficient government they're trying to have as much be a much more balanced

instead of, you know, book of business. So I think there's opportunity for all technology companies in the future as we get into the automation and technology adoption part, hopefully. Okay, now.

On March 18th, you tweeted, never dull moment in cybersecurity. And that was when Google bought Wiz for an astounding $32 billion. Now, you've got twofold here that I want to ask. You worked there for 10 years, 2004 to 2014. And you use BigQuery. You are a customer of theirs. 170,000 projects in Google Cloud. What happens if Google says to you, you know what? We have Wiz, 170,000 projects, go on.

No. So first and foremost, look, it's a great day for cybersecurity. If you can build a business and you can sell it for that amount of money, it inspires more entrepreneurs to go out there and build their next cybersecurity business. Will you tell me instead of $124 billion, you might be worth more because of that? Well, if $600 million ARR is worth $32 billion, I can do math. We're clearly closing in on $6 billion. But let's put that aside. As they say, the price of something is what somebody is willing to pay. Right.

Look, it's a great day for cybersecurity, one. Two, in terms of we are one of the largest customers of Google, both on the security side, the enterprise side, and we have talked to them. And they're trying to keep it balanced in terms to make sure that they serve their customers effectively. And at the same time, we have a bit of competition going on in cybersecurity. Do I need to worry that they could just say, you know what, I know you're a customer, but we don't want you anymore? I think that's going to be very hard.

for them to do. I think, in fact, they haven't said it. We had a wonderful conversation with them last week and we continue to work with Google. We continue to run our infrastructure and GCP and some other cloud providers. So I think from that perspective is fine. I think it's going to be interesting what happens in cybersecurity going forward. I think we will continue to see consolidations.

I think the world is heading towards platforms, something we've been talking about for a while. I think this is one more reinforcement that you can't just have one piece of the action. You need to bring more. And you're seeing that Google do it. You see Microsoft has a phenomenal security business. We have a good security business. You're beginning to see that you need to be big in cybersecurity to play at the table. And you have a small security business with IBM as a partnership. It seems like it's working out well.

You know, it's going to go down as one of our best arrangements and deals we did in history because, you know, Arvind and his team are just amazing. They are forward-leaning. They have north of 1,000 people working with us on this now. I'm appreciative. And we are able to migrate a lot of the IBM customers who are on the technology called QRadar, which was robust but needed...

sort of a refresh and we are able to provide refresh in the form of our product called XIM, which is now the leading product from our perspective, you know, sort of powered by AI. All right. Now I know we have to wrap things up, but Keanu Reeves, John Wick, cool guy? Very cool. Yeah? Very cool. Cooler than you? Of course. Who else would you have epitomized saving the world in a cyber incident but Keanu Reeves? Fair enough. Nagesh Arora, Chairman and CEO of Palo Alto Networks. Thank you, Nagesh. Thank you, Jim.

Coming up, Kramer continues his look at what's working in this tape with a pulse check on the healthcare space. Next.

Under Biden, Americans' cost of living skyrocketed. Food, housing, auto insurance. Lawsuit abuse is a big reason everything's more expensive today. Frivolous lawsuits cost working Americans over $4,000 a year in hidden taxes. President Trump understands the problem. That's why he supports loser pays legislation to stop lawsuit abuse and put thousands back in the pockets of hardworking Americans. It

It's time to make America affordable again. It's time to support the President's plan. Introducing Instagram teen accounts. A new way to keep your teen safer as they grow. Like making sure they always have their seatbelt on. Alright, sweetie pie, buckle up. Good job. Or ring the bell on their bike. Okay, kid, give it a try. Nice. Or remember their elbow pads.

Needs to, okay? Yep. There you go. New Instagram teen accounts. Automatic protections for who can contact your teen and the content they can see. I was seeing some signs of stabilization stop working, but until tariff day arrives on April 2nd, uncertainty remains king.

For now, we're in a holding pattern, awaiting more details in the president's adjusted trade policy, along with more economic data and, of course, earnings season. Oh, my, in a few weeks. Don't get any sleep then. Now, we don't know if we're merely in the eye of the storm or if we've truly got clear skies in the market again. But after coming through a very difficult period for stocks, we do know which ones still managed to rally during a hideous time.

That's why all week I'm walking you through some of the 10 best performers in the S&P 500 year to date, because for the most part, these are the stocks that survived and thrived during the correction. Now, last night I talked about Newmont Corporation because the gold miners have been big winners here. Real safety stocks when you're worried about worldwide economic chaos. And tonight I've got another classic safety category that's thriving in 2025. Just took a little breather today, and that is the pharmaceutical stocks. So

So let's start with one that really is one of my favorites, Vertex Pharmaceuticals. It's the seventh best performer in the S&P this year. It's up more than 26% for 2025. This one's an old family favorite. I've long liked Vertex for the show for ages. It's an innovative biotech that I originally recommended for its fantastic cystic fibrosis franchise. But over the years, we've watched Vertex mature into a big pharma company with

for $131 billion market capitalization. That cystic fibrosis business alone did $10 billion in sales last year, and it's why I've championed the company. Now, more recently, Virtex has come up with a budding non-opioid painkiller business. Now, this is incredibly exciting because America has a massive opioid epidemic, something like 87,000 drug overdose deaths last year.

This is the leading cause of death for Americans aged 18 to 44, even as overdose tests were down 24 percent in 2024. The numbers may be coming down, but you've got to admit, they're horrifying. Unfortunately, opioids have been the most effective way to treat severe pain. And until Vertex, there was no addictive, non-addictive alternative. Everything was addictive. Your only choice were to risk getting addicted or pray that a little Tylenol could do the job.

Now, Vertex changed all that with a drug, and I'm going to get this right, I think. Suzetrasine. Suzetrasine. This is a very effective painkiller that basically blocks parts of your nervous system rather than directly messing with your brain, which means it's not addictive.

Now, this one got FDA approval for moderate to severe acute pain at the end of January, which is why Vertex has been such a big winner this year. But in order to get that gain, you needed to have a lot of faith in this company. I recommended it back in mid-December as part of a group of beaten down health care stocks. Now it's up nearly 9% since then versus a 5% decline for the S&P 500. But three days later, Vertex plunged 11% in a single session. After we got some confusing phase two clinical trial results,

studying suzette machine for a type of chronic back pain caused by pinched nerves.

stuff's so painful. While the drug met its primary input, allowing them to move on to phase three trials, the placebo group experienced a similar reduction in pain. That called the entire study into question. And a lot of people figured that it would be tougher for the FDA to approve this Vertex painkiller for anything related to chronic pain. Now, I hope you stuck with it, though, because after that setback, the stock caught fire. It has not looked back since. In fact, the very next day, the FDA approved Vertex's new cystic fibrosis drug. But the

But the big news came on January 30th when the FDA approved suzette machine for moderate severe pain. Now it's under the new name is called Jernivics. First non-addictive painkiller to be approved for severe acute pain in more than 20 years. The drug's launch is now well underway. Vertex is working with insurance companies and group purchasing organizations to maximize coverage. This is a joyous story, people. And even talking to politicians to push legislation that promotes non-opioid painkillers. I like this.

In fact, UnitedHealthcare's OptumRx subsidiary announced coverage for Drunovix earlier this month, marking the drug's first big pharmacy benefits manager win ahead of its launch. A few states, including New York and Arkansas, have already provided broad Medicaid access to the drug as well. We still need to watch how they do with chronic pain rather than acute pain, but so far, so good.

When Vertex reported in early February, the numbers were solid. And once the market started falling apart last month, the stock kept levitating, along with the rest of the pharmaceutical space. In fact, the whole health care sector has been doing pretty well this year. The Health Care Select Spider Fund, that's one of these ETFs, is up 5.5% in 2025. Only energy has been doing better.

And many of my favorite stocks in the individual pharma stocks, not just the ETF, are doing very well. Longtime Kramer fave and charitable trust holder Eli Lilly has been volatile at times because it's a high multiple growth story. In other words, it's got a high PE. And it preannounced this morning fourth quarter numbers on this show in January. Bad.

But it bounced right back quickly once they reported the full fourth quarter in early February, as the earnings numbers looked very good and their four-year forecast was excellent. It's currently sports a more than 10 percent gain for the year. I don't think it's done. We had Ken Langone recently. You know that he's one of the great investors of all time. He still loves it. Prescription data for Lilly's lead GLP-1 drug known as Moongaro for diabetes, Zepbound for weight loss, continues to look strong. The next big catalyst for Lilly this year should be a phase three data readout for trials.

evaluating an oral GOP-1 drug. Right now, you've got to stick it in you. That's expected this summer. I remain very positive on the stock of E. leo. Finally, I want to highlight the performance of another charitable trust holding, Bristol Myers Squibb, which is up almost 5% this year, largely thanks to this early strength of the company's new schizophrenia drug, another thing that we had nothing for in 30 years. This is called Quabenfi. This one was approved by the FDA last fall. It represents the industry's first new approach because, by the way, schizophrenia, they used to treat it with, you know,

any old drug that worked for seizures.

All the existing treatments cause horrific side effects, which is why so many people went off their meds. But cobanthi is much milder. It doesn't have a weight gain issue. And Bristol-Myers thinks you can get approval for many other mental illnesses in the future. I'm very positive on it. Really, all sorts of pharma stocks are working this year, including former entrepreneurs like underperformers like Gilead. It's up 17 percent. AbbVie up 13 percent down a lot today. J&J is up more than 11 percent. Another stock that got hit, Abbott Labs, big position for us.

it's more of a medical device play we own for the chapel trust gained 11 for the year the relative safety of these healthcare names has trumped some of the remaining questions about the group like any potential adverse impact from the health and human services secretary rfk jr who's got a bad attitude toward vaccines and maybe the farm industry in general now here's the bottom line even in a hideous environment many of the pharma stocks have soared especially kramer of a vertex with its revolutionary non-addictive painkiller that could single-handedly beat the opioid epidemic

I know the group was weak today. It's been weak for a couple of days. But I think there's opportunity here to buy these stocks. I just went over. As the quarters really cooled down from that ridiculous spike that I warned you about a few weeks ago, I think it's time to do some buying. Now, tune in tomorrow night for another installment of this series on the first quarter's biggest winners, the stocks that triumphed over the brutal correction. I'm going to go to Lou in Pennsylvania. Lou.

Hi, Jim. I own shares of this British pharmaceutical company and have done well with it, except over the last two weeks when it has a lot of company. Pump has recently, however, threatened tariffs on pharmaceutical companies. Has this changed your previously positive opinion on GSK? Not at all. Not at all. I like GSK very much. I think it's a very good company. I think Damon Wamsley is doing a terrific job. I think the stock, the fact that it's a very low PE and it yields 4%, that's my kind of stock. I think you, Bob,

Put it away. Buy it and put it away. I want to go to Brett in California. Brett. Hi, Jim. I'm calling to get your opinion on Catalyst Pharmaceuticals. About a year ago, you did a segment on the show regarding five small cap

healthcare stocks and that was one you profiled and I've owned it for about a year and a half and was just wondering what your current thoughts are. No, I think it's very good and it's had a very good year. It's up more than almost any company I follow. Yeah, we did like it. Now, remember, there's still small cap stock and there's some insider selling, but I do think it's just a very good situation. We went over that last

a while ago and it beat the earnings estimates, it'd be crushed. They're supposed to earn $0.55, they're supposed to earn $0.70. That's my kind of stock. I think you're in good shape. Now, we're going to go to John. John, thanks so much for taking my call. I appreciate it. Of course. I wanted to get your thoughts, Jim, on simple DCTH, DelCap systems. It's been great in 2024 and hoping it can run again in 2025.

Well, it's especially pharma company. It is supposed to have its earnings breakout this year. And that's why I'm going to bless it. Because remember, I'm not recommending stocks that are losing money, but supposed to have an earnings breakout. But I would say people who are looking at it, it's not you're you're not early to the story anymore. I'm glad that you, John, been able to be take advantage of the fact that this stock's been such a win.

Now, even in this tough tape, the pharma sector has held its own. Especially when it by phase, Vertex Pharma. Don't forget Bristol Myers and Eli Lilly. Now, much more mad money ahead, including my exclusive with fiber product producer International Paper today after their investor day. Worth looking at. Then first of all, some concerning consumer data. I'm breaking down what I think could return some much needed confidence to this economy and to the people in it. And of course, oil costs rapid fire. Tonight's edition of the lightning round. So stay with Kramer.

Look at this incredible move in the stock of International Paper. The packaging kingpins up nearly 6.5% today. Now, normally the packaging stocks have a lot of economic sensitivity, meaning they get hit hard when people are worried about the economy. I think this time's clearly different.

About a year ago, International Paper brought in new CEO Andy Silvernail, and he announced an all-stock merger with DS Smith, which is a European company in the same line of business. After formally taking over last May, Silvernail got to work turning the business around. The stock has fallen to up 38% over the past year. Okay, maybe you can't see the numbers yet, but this story's got a lot of believers. Now, today, International Paper held a big investor day in the city, New York City, where management rolled out some ambitious longer-term financial targets, and that's why the stock caught fire.

So can it keep running? Let's check in with Andy Silberneur. He's the new chairman and CEO of International Paper. Find out. Mr. Silberneur, welcome to Mad Money. Thanks, Jim. Thanks for having me here today. Well, I have to tell you, it's all different with you.

No, I mean it because we've seen you come in as the mandate as a change agent and you've delivered. Yeah. Yeah. Thank you, Jim. First of all, it's a pleasure to be here. And the team we have at International Paper, they are outstanding. You know, one of the things when you're looking at a new opportunity, when they came and contacted me, you're looking at what's this team going to be like? And we have 65,000 employees here at International Paper now, including D.S. Smith.

and they are outstanding and they've bought in to change. They bought into transformation and that's what we're doing. We want to be the world's leader in sustainable packaging and this team is fired up and bought in. Now you have come up with something I've heard. We saw it at ITW, another very successful company, the 80/20 strategic, which means that you really are drilling down and emphasizing the biggest customers and then doing great non-commodity things for them. That's exactly right. So Jim, 80/20, you're right. It came out of ITW.

as I was in Chicago working for IDEXX. We borrowed it from them. - All right. - So thank you ITW. - No pride of authorship, necessarily. - Absolutely not. And one of the things I learned early in my career, so I was at Danaher right out of business school. So I was at Danaher right out of business school and you saw the power of a system. Of a system that's understandable,

applicable, something that can help you win. And 80-20 is that. What it is, it's all about figuring out what matters most. Where's money? Where is the profit pool? And then how do you move people and investment towards that? It also means saying no to the things that don't create value. Well, OK, let's talk about that, because my father was a jobber for international paper for years. And then what would happen if he was selling crap paper in Corrigan? And then God would come in from stone.

and say, listen, Mr. Kramer, I can make it cheaper. And then Smurfett would come in. Then Westfra would come in. He ended up with a pile corrugated, and no one made any money at all. That has to end. Right. It has to end. And that's one of the cool things about it, having grown up in a paper mill town myself. Because your family's in a paper mill. My wife was the fourth generation of working in the Bucksport paper mill. It's just incredible. My father-in-law retired from IP. Just a great story.

But the key is, is we are not a paper company. We're a packaging company. And the thing to think about is differentiated packaging. And what we do is we enable our customers to get their goods to their customers. And what matters is the value in the value chain. So if you think about that cost of ownership, that cost of the value chain, we're trying to help them win. And so that's not a commodity.

business. That's a differentiated business that's helped them win. Well, you have to tell me, what do you do for Mondelez that makes it so that I couldn't come in with my paper company and say, listen, Mondelez, I'll come in under you. I'll come under your paper. Yeah. We solve problems, Jim. What we do is we solve their problems. So I'll give you a great example. So the first time I went to D.S. Smith, I went to their Impact Center, which is an innovation center. And Mondelez, you got a chocolate bar that goes into a package that goes into a supermarket.

And those chocolate bars would fall over. So customer can't see it. So we came up with this great innovation that actually pulled the bars forward. So if someone takes a bar out, the next one pushes forward. Sales go up 35, 40%. That's solutions. That's the kind of things you're trying to do. - Now, how about in the, when you're dealing with fresh protein, poultry, how can you innovate on that?

Well, so you think about the cost of moving chicken or beef or something like that. You have to move it refrigerated. You have to have boxes that are strong. They can't leak anywhere. So you're in there solving problems with them. That's the key. You're solving problems with them. Like, where's the cost of failure? Where are the points of failure? And you're working collaboratively with them to come up with design, to come up with technology that lets them ship their products safe, productive. You're trying to help them drive and win in the marketplace. Now, formerly, I know you would have plants that were nowhere near any of these customers.

And therefore, you had no advantage in terms of speed. Yep.

- Yep. Is that changing? - It's changed enormously. So if you look at our network in Europe or the US, we have 110 box plants in the US. - Really? - Yeah, so every major metro area. 'Cause if you think about it, you're shipping air. When you ship a box, you're shipping air. So you gotta be close to the customer. So we have, if you look around New York City, we have a series of box plants around New York City that's feeding all of the industry around here, multiple plants. - Including e-commerce, right? You're helping- - Including e-commerce, yeah. We are within 200 miles of 95% of the population in America.

And any place you go where they're in 200 miles. This is so different from the old IP. It is, isn't it? Yeah. It's glorious. I mean, I think that you've solved what many people always wanted IP to do, which is do what the customer wanted. That's the key, right? You work back from the customer and that's how you win.

And in that way, a rival can't come in and say, look, I can do that because they can't. It's pretty hard, right? So the scale and the scope of what we have throughout the country, throughout Europe, now with the DS Smith acquisition, it's pretty hard to match that scale and scope. And then you put customer intimacy with it.

That's a winning move. Well, I've always felt it could just be a huge stock from the time when my father repped them, and it looks like it's finally coming true. It took a little while. It doesn't matter. What matters is it got there. And I think people should look at this stock. That's Andy Silvaner, the chairman and CEO of International Paper IP. Wow. It's happening. They have money's back in them. Coming up, Kramer takes your calls. And the sky's the limit. It's a fast-fire lightning round. Next. Next.

It is time for some of the lightning round. And then the lightning round is over. Are you ready? Steve, daddy, time for the lightning round. We'll start with Stephanie in Colorado. Stephanie. Yes, hello, Mr. Kramer. I'm so happy to connect with you. I wonder what your opinion is about Shopify. Oh, Shopify, the Canadian super app that is going to be moving here and listening in New York. I say bye-bye.

Buy, buy, buy! And now we're going to go to Frank in Ohio. Frank! Hello, Mr. Kramer. I have a stock, PAA, Plains America. Listen, Sunshine, that's a terrific stock with a 70% yield. Not only am I a buyer, but I wish we had it for the travel trust. Now we're going to go to Lauren Connecticut. Laura! That accent. Laura! Hello. Hello. Thank you for having me on the show. So excited. My pleasure. Thank you.

So I have a question, and I'm hoping you can help me out. I had bought SoundHound Low. Oh.

Okay, so look, I want you to sell SoundHound. I regard SoundHound as a complete meme stock. It's part of the cohort that we see now trades every morning, and it's depending upon its relationship with NVIDIA. And I don't think the relationship is really that meaningful. I think you should sell SoundHound, okay? I'm putting it out there. I know it's going to give you a lot of heat online, but I don't care. Let's go to Brian in Michigan. Brian.

Hi, Jim. This is Brian. I've been watching you every day at 9 and 6. Oh, thank you, man. Yeah, I thank you for what you give all of us.

And I just want to get your opinion on FMC. I was very depressed by FMC. Right at the time we were winning the Super Bowl in Philadelphia, they came out and they were like, I mean, they dropped the ball. It's very rare to see a fumble like that was so bad as they did. It was like a pick six against them. I want you to stay away from FMC. They have a lot to prove. That was a terrible quarter. Let's go to Paul in Arizona. Paul. Jim, long time, first time. Oh, excellent. I'm glad you're on. What's up?

You have a tremendous amount of energy. I don't know how you do it. Well, I don't know. I got a great staff. I got Regina Gilgan looking at me. She's always real critical of me. That's fine. It keeps me on my toes. Thank you.

Go ahead. Right to the chase. I'm curious to know, what is your take in general on the coal industry? What is your take in particular? You know, I was betting that coal could make a comeback only just because I just thought that was the line with the president. But the prices for coal are so bad. Any particular stock in the coal group? Yes, sir. Core Natural Resources, CNR. That's just another just, you know, it's a Pennsylvania coal company, but there's

There's just not much to these stocks. I wish they could find a bottom, but they can't. But I really think whether you call about it. Let's go to Charlie, California. Charlie.

Hey, Jim. Hey, long time listening. I really appreciate what you do. I wanted to start off by saying thank you. If it wasn't for you, I probably would have never gotten the market. The way you explained it on all your shows, it gave me the confidence to do what I do now. Thanks, Charlie. Well, that's the goal. To give people confidence to make the decisions themselves is really my goal because they have it in them and so do you, Charlie. How can I help you?

Hey, so I'm a big fan of Palantir. I was in it way back when it was 18 bucks a share. I got out before it took this last dive. Is it time to get back in? Yes, it is. Palantir's a winner. And I'm telling you, we're going to see what they do with the defense part. I'm telling you, they're going to help the procurement department, the procurement process. And I'm a believer in Palantir, even if they don't believe in me. I don't care. Let's go to Eric in Michigan. Eric.

Jim, I'm a die-hard money watcher and a member of the club. Yes, thank you. What's going on? Two quick questions about Rocket Company. Question number one, I own a significant position in Rocket Company and wanted your opinion on the recent purchase of Redfin. And question two, when the Fed cuts interest rates and we get a refinancing boom, can this stock double from here?

Okay, I was not a big fan of the Redfin acquisition, and that was in part because I'd looked at Redfin many, many times, couldn't really figure it out. However, I am a big figure, a big believer in Rocket, and yes, exactly what you said will happen. Therefore, you can own Rocket. The Redfin, I wish they would come on and explain it. I really do, because I really like them, but I thought that was quizzical. Let's go to Richard in New York. Richard! Richard!

Sir, give me chills. Yeah, man, what's up? Well, my pleasure. Right back at you.

Thank you, sir. So listen, I recently got involved in stocks about a month ago. It had recent approvals from FDA and it did get a little pop. But every day since then, it seems like it's dropped for over a month. And then I looked into it. There's obviously been some insider trading, even a million shares this week. And my question is, when is it investable? Is it still investable? S-W-T-X? S-W-T-X?

Springworks Therapeutics. Man, I don't know Springworks from spring water. We're going to have to do some work on that one. I'm going to put the Professor Ben Stoto all over that because he knows I came forwards and backwards. And that, ladies and gentlemen, is the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab.

Let's say you're on recession watch, which I am most definitely not. But if you're betting on a recession, this was a banner day for you. In 24 hours, we got some very worrying signs. Right now, many believe the Federal Reserve is on hold because it wants to see what the tariffs will look like. But today's comments from KB Home, the home builder, along with the hideous consumer confidence numbers from the conference board, cast serious doubt on the idea that we've got any sort of growth in this economy. It may need some help soon from the Federal Reserve.

Let me tackle KB Homes first. This is a large home builder with a presence in 10 states, all known to be hot markets. States like Colorado, Nevada, California, Florida, Texas. It sells homes for about half a million dollars on average.

Last night, Jeffrey Metzger, the CEO for 19 years, and I regard him as an elder statesman now in the industry, said the words no one wanted to hear. Quote, consumers are continuing to cope with affordability concerns and uncertainties around macroeconomic and geopolitical events. End quote. He goes on to say, as a result, consumer confidence has declined sequentially each month for the past several months, and homebuyers are moving more slowly in making their purchase decisions. End quote. Not great, Bob.

But it gets worse. Quote, demand at the start of the spring season, selling season, has been more muted than we have seen over the past few years. Muted. Ouch. KB Solutions cutting its price of homes and it's cutting its forecast. Suboptimal.

Second big thing, this morning the conference board's consumer confidence index may be blanched. The expectations index based on consumer's short-term outlook dropped 9.6 points to 65.2. That's the lowest level in 12 years. You know what's worse than COVID times? That's well below the threshold of 80 that usually signals a recession. It's the fourth consecutive month of declining consumer confidence. I regard that as very disconcerting.

Now, that's the bad news. The good news is the Federal Reserve can see this data, too, and it can take action if it must, even though the Fed's gotten less certain about its next move. When I see these numbers, though, I think maybe the Fed can't afford to wait until they see how much inflation the tariffs cost. We simply don't want a recession here if it's avoidable. But let's address the consumer confidence issue head on.

I think people in this country read about the zest with which the White House is laying off people, closing portions of the government, even, let's say, touching Social Security Administration, which is a political malpractice and a proven third rail. They're worried about layoffs and machines taking their jobs. Makes sense. The robots just keep getting better and smarter.

They're concerned about tariffs, too, in part because the White House really hasn't done a good job explaining why some tariffs are necessary, but also because they know it's going to be short-term payment because, well, the White House said it. The House of Pay. All these concerns erode confidence. When confidence seeps away, people hunker down. They stop going out. They stop spending. That's why so many big retail stocks are doing so poorly.

Is there anything the president can do about this? I think it might be time that he actually talks to people in a calm way about how many jobs could be created by cracking down on our so-called trading partners. Time to bury the hatchet with Mexico and Canada, too. And don't bury it in the head of Mark Carney, the new Canadian prime minister. I think conferences return with certainty. Even the certainty of knowing what will happen with these two countries could really help. Look, as someone who believes in fair trade, not free trade.

I'm happy to take a short-term hit if it means leveling the playing field on trade. But I have the luxury of liking it. For me, the pain is all theoretical. It's not like I'm living paycheck to paycheck. I know that. I'm actually proud of it, but I was at one time. Most people don't have the luxury I have. When enough people start worrying about the economy, that's how a recession starts. And once it starts, it's very hard to stop. I like to say there's always a bull market somewhere, and I promise I find it just for you right here on MadMoney. I'm Jim Cramer, and I'll see you tomorrow.

All opinions expressed by Jim Cramer on this podcast are solely Cramer's opinions and do not reflect the opinions of CNBC, NBCUniversal, or their parent company or affiliates, and may have been previously disseminated by Cramer on television, radio, internet, or another medium.

You should not treat any opinion expressed by Jim Cramer as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. Cramer's opinions are based upon information he considers reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Mad Money Disclaimer, please visit cnbc.com forward slash madmoneydisclaimer.

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