Mad Money w/ Jim Cramer 6/3/25
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Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. I'm with my friends. I'm just trying to make you a little extra money. My job is not just to entertain, but to educate and teach. So call me at 1-800-743-CBC. Tweet me at Jim Kramer. All right, this market's struggling with something real basic. It's just not doing a good job of valuing stocks, which is exactly what a market's supposed to do. In fact, it's valuing them wrong so often.

that I think creates a ton of confusion. And that's a real shame because this action is people getting fed up with the stock market. Again, you can feel it, I know. And just when we're seeing some very good gains from a host of sectors, people say, bye-bye, I can't take it. That's what I'm moping about. After a solid day where the Dow advanced 214 points, that's a gain 0.58, but the Nasdaq climbed 0.81%.

Once again, it was a solid reversal from early morning trading. This is the pattern. Let's start at the very beginning of a typical day in this market. I'm an early bird addicted to watching the tape ever since I first laid eyes on it in 1981. It's a fast-standing thing to track because the tape contains an unbelievable amount of information, if you know how to interpret it. And I am a tape whisperer. The early morning action is the best place to start when you're talking about what the market's failure to value stocks is all about.

The early morning starts the way it almost always does. This happened today by 5 a.m., which is already an hour later that I've been looking at the darn thing. Yes, we usually got about 0.25 percent. And that's next down between, I'd say, 0.45, 0.47 every day.

I get that. We've seen stocks disappoint an awful lot this year. But as I tweeted yesterday and today, I can't find the reason why I say the Nasdaq would be down 0.47, given that nothing happened since the close of the day before. Nothing. And look, I'm always as current as possible in upgrades and downgrades from the night before. And again, nothing could justify stocks looking that ugly this morning or yesterday or, well, most of last week.

So what is happening? Are the futures lying? No, they're just plain wrong.

Let's ponder the first mistake this market makes. We're regularly getting sellers right from before the get-go because what are they doing? They're positioning themselves for President Trump's potentially angry and rash statements about trade, about China, about a tax on Apple, a tax on Walmart, or maybe even Nvidia. They want to sell stocks short to profit off the president's next furious true social post because they know the market will take it negatively. Why? Because it's negative. The House of Pay.

When he said so much for being Mr. Nice Guy about his somewhat critical views of China, he made the short sellers some real good money very fast. When he attacked Tim Cook for moving out of China and then going into India, or when he chided Walmart's Doug McMillan for having to raise prices, even after Walmart cajoled Chinese suppliers for breaks, that he was practically printing money for the pessimists.

When some anonymous source in the White House said Nvidia couldn't sell the chips it wanted to Chinese customers, effectively blocking the company from a $50 billion market, the shorts cleaned up. Oh, for them, it must have been a thing of beauty. I get where the shorts are coming from, but their strategy doesn't work if the president keeps his mouth shut and doesn't go to the, or whoever posts the stuff for him. They just don't get it up there.

It's an outright failure when the day's tone is set by the considered, level-headed, calm, coherent, and thoughtful Secretary Besson from Treasury. And I hope my saying that does not get him fired. But when Trump reminds us of how horrible all of our so-called trading partners are, yet what a bunch of fiends and fools, when he puts out deadlines for the best and final offer, when it's possible the Supreme Court may take the case and strike down the tariffs,

Paris will shiver me timbers. That's why the overall market's often wrong and regularly changes direction. Today for sure was a Besant day, not a Trump day. And that's the recipe for a good session. Second, the market remains way too skeptical of the need for more AI infrastructure.

Ever since we heard that the Chinese had something that was supposedly better than NVIDIA, the industry's never regained its luster. The stocks of companies even remotely connected to the data center, think Eaton or Cummins or Vertib if you want to. They've lagged terribly. Oh, and NVIDIA, for months, it was a chronic underperformer. But hey, it turns out the bear case on AI may have been dead wrong. For instance, have you seen the stock of NVIDIA?

It climbed from $86 and changed its lows in April all the way to the mid-130s when it reported an incredible quarter with an amazing forecast. Much better than expected. Stock then rallied to 143 after the quarter, but then it was thrown back when the White House refused to let Nvidia sell China, even its lesser semiconductors. The stock gave back a big chunk of its post-earnings gains, and the shorts, well, they were in there. Sell, sell, sell. Congratulate themselves. Pat themselves on the back. We realized...

The market got things wrong today, though, when we saw Meta's lining up 20 years worth of nuclear power from Constellation Energy for AI. You don't sign up for 20 years worth of nuclear energy with a plant that's about to close three years from now because you think that the data center's dead or dying a slow death.

Next thing you know, NVIDIA's right back to 141 where it went out today. What a relief. Of course, the whole time you could have gotten a clear read on the data center by looking at the action, the pin action, I should say, in CoreWeave. This company builds data centers and then rents out its computer power to some real heavy hitters. CoreWeave had the misfortune of becoming public a couple months after DeepSeek, the Chinese company, created an AI model supposedly using Farless Harbor.

They had to cut the size of the deal and the IPO. They took it down to 40. Really, this thing priced at 40. It wouldn't have come public at all if it weren't for NVIDIA taking an anchor position to ensure the deal worked. Now NVIDIA is so huge that it's 24 million share position. Now $150 stock really doesn't mean anything. But if you bought it right after the company came public,

You've nearly quadrupled your money, thanks in part to a data center licensing deal with Applied Digital that sent Corby up 25% today. So what can I say? It looks like people are wrong again. Then there are the dollar stores. Talk about wrong. Now, there's this sotto voce belief on Wall Street that consumers in this country actually still feel flush. So they're staying away from the dollar stores when you go. Those are places you go when you feel times are tight.

This morning's report from Dollar General put that thesis to bed. CEO Todd Vasos told us about a recent survey that the company did where their customers reported having, quote, less income than they did a year ago. And nearly 60% of our customers noted that they felt the need to sacrifice some necessities in the coming year, end quote. Mind you, necessities, not red solo cups, not plasticware, okay? We're talking about skipping everyday basic needs.

And it's not just lower income people who feel the pressure. They seem plenty of middle income and even higher income customers coming into dollar general. They went out of their way to say that they'll do their best to make price increases their last resort. But it sure sounds like they may have to raise prices. They sort a huge amount of stuff from China. I mean, huge. So here's what I say about that one. Just don't tell the president. And that's how so many people got dollar general wrong, allowing the stock to soar nearly 16 percent today after a great quarter.

When you examine the market's mistakes, they share a common theme. The president's distorting pretty much everything, especially with his tariffs and his jingoistic approach to the rest of the world. And it's continually confounding traders and investors alike. People would just rather be short. They expect the market to come down every day.

Plus, I think that Trump has almost single-handedly revived the short-selling business. That's run since that money can be made by betting against stocks again. I know for a fact that lots of hedge funds which gave up shorting after the time of GameStop are now back with a vengeance. They place big bets every day, betting that Trump will crush some company with a well-timed true social post. The short-sellers aren't in charge, but they have a lot of firepower.

and a lot of conviction. They take strong positions like those against Nvidia or Corweave or Dollar General. And when the tape is ugly, they crush those stocks because they figure they can't lose as long as Trump's in the White House. But the bottom line, these short sellers, they've grown way too confident.

And today we found out they can lose big because lots of businesses are doing great. It's just that Wall Street only notices on days when the White House doesn't take up too much bandwidth. Oh, and thank you, Secretary Besant, for your measured cerebral approach. I actually find it a breath of constructive, fresh air. And your demeanor is duly noted right here every day that you represent the White House. Bill. Oh, my old friend Bill in Massachusetts. Bill.

Hi, Jim. How are you? I am doing well, Bill. What's shaking with you? Hey, listen, can I quote you from a morning meeting from last June of last year real quick? Why the hell not?

Always be tough on your portfolio. Focus on the worst stocks. Never buy all at once. Sell into strength. Don't fall in love with stocks. Give your stocks a hard time. Don't blow out of positions. Like stocks, less as they go up. Study valuations and get tough. Sell into powerball moves and market rallies, Jim. Man, that guy's got more sense. He said that.

on the morning meeting of June 18th of last year. Well, that had what I call clarity. Clarity of thinking.

That's how I learned. That's how I learned from you. It's amazing. It's amazing. Thank you. Thank you, buddy. Thank you. Thank you, buddy. That makes me feel great. And you see what Bill's referencing is Jeff and I do a program from 1020 to 1030. And, you know, other than my mother, no one watches it. And actually, my mother passed away 45 years ago. She probably hasn't checked in and watched it either. But Bill watches it. We just found out about that. Bill's a watcher. Bill watches. So, Bill, how about a question?

Yeah, Jim, I asked you a couple of months ago about GE Aerospace. It's

GE Aerospace, Bill, is about as good as it gets. That guy from June of last year, he knew. He knew that GE Aerospace was good. That guy's so smart. I got to get him on the show. Anyway, Bill, thank you for saying those kind words. And I truly love GE Aerospace right here. Oh, no. Do we really have to cut away? I had Stanford in California coming on. You know, Stanford's one of my pal buddy friends. All right.

All right. Anyway, you've heard it. I didn't mention the Wells Fargo lifted its asset cap. You know how to do that. But you heard it. The market just keeps getting it wrong. And that's because they keep hoping for a post. And when Secretary Besson out there with his very consistent non-mercurial behavior, the stock market goes higher. What can I say? It's just a reminder of just how wrong people can be when they think it has to go down no matter what. I'll meet everybody tonight.

The negativity surrounding Salesforce. Oh, holy cow. Is that palpable? But is it justified? I'm going to share where I come down after the company's recent earnings report. Then, is the market getting it wrong with its reaction to Dell's latest quarterly results? I'm going to dig into the numbers and tell you where I stand. And are the crude oil bulls in for a rude awakening given the commodities relationship with the dollar? I don't know. Why don't we go off the charts to find out? And I want you to stay with Kramer.

Don't miss a second of Mad Money. Follow at Jim Kramer on X. Have a question? Tweet Kramer. Hashtag Mad Mentions. Send Jim an email to madmoneyatcnbc.com or give us a call at 1-800-743-CNBC. Miss something? Head to madmoney.cnbc.com.

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We've got to resolve something. Why the heck does everybody suddenly hate Salesforce? Last Wednesday night, Salesforce reported, and as usual, we spoke to CEO Mark Benioff on Mad Money after the print. I thought it was a pretty good-looking quarter. Solid top and bottom by B with real momentum for the company's Asian Force AI offering. Man, was I wrong. But even better, I thought management gave you an impressive outlook for the current quarter. Raise the four-year forecast again.

And yet after sorry as much as 18 points in the after hours trading for people like me who thought it shouldn't go up, it gave up all those gains and then dropped another 10 points the next day. Now, this was just a shocking development for this once beloved enterprise software story. Now, it kept going down on Friday and yesterday.

We're finally stabilizing today. Thank heavens. Overall, Salesforce has fallen nearly more than 4% since the quarter. And given that I'm so close to the story, it's been a core holding for my chapel trust for ages, for heaven's sake. I want to circle back because you need to know why the sellers have been dumping the stock, why I think they're wrong and why I've been wrong. Let's start with the bear case.

Even before the quarter, this stock was getting mauled because last Monday, Salesforce announced an $8 billion acquisition of a company called Informatica. That's a data management analytics play that no one really cared about, frankly. During our interview last week, Ben Yoffe explained that Informatica's technology helps enterprise customers better organize and standardize their data, making it more useful for all sorts of AI applications, including agent force. But investors have their doubts.

And that's primarily because of Salesforce's last big deal. That was the nearly $28 billion cash-to-stock acquisition of a company called Slack, which closed in the late summer of 2021. Particularly for the time for the stock market. I think it's safe to say that Salesforce overpaid for that one. Now, look, they're integrating Slack's collaboration tools into their whole product suite. I'm going to hear that immediately for saying what I just did. It's just not clear how much of a boost it's given them. At least not to here. Not to Wall Street.

Now, roughly a year after the Slack deal closed, we saw several different activist firms make a run at Salesforce, which eventually led to much more cost discipline and sizable buybacks. Wall Street loved all that. It's a big reason why the stock probably from 132 and change at the end of 2022 to an all-time high.

Of $369 last December. Boy, is that far away from here. But I get the sense this informatic acquisition is giving investors, how about PTSD? They're worried that Salesforce will lose its spending discipline and return to their more freewheeling days of old, which brings me to the real crux of this issue. There's a feeling that old Salesforce, meaning the core sales and customer relations management software, plus all the inclusion is slowing meaningfully. And the new AI offerings like AgentForce, they just aren't ramping quickly enough to make up

a difference. I thought that Salesforce much better than expected results and guidance this week would help dispel that notion, but apparently not. So let's take this apart. It's true that growth for most parts of Salesforce is indeed slowing. If you look at the constant currency growth rates, that's important, constant currency, for all five of the company's segments, four of the five saw the growth decelerate in the latest quarter, both year over year and quarter over quarter.

Only the AI-related segments saw an acceleration from 10% a year ago to 14% in the latest quarter. And by the way, if you thought the strong guidance would quell some of the concern about a slowdown at Old Salesforce, you'd be wrong, because much of the strong guidance was dismissed as simply the result of a weaker dollar, which boosts the company's sales overseas. Now, while the guidance for the current quarter and full year was basically ahead of expectations on every line,

Some analysts fixated on one line in particular, and that's the current RPO or remaining performance obligation. That's expected to grow by 9 percent in the current quarter on a constant currency basis. And one analyst pointed out this would be the first time in history that Salesforce current remaining performance obligation growth fell to the single digits.

All right, now how about this agent force debate? Let's take it head on. Like I said earlier, the concern here is that Salesforce and Gen 6 platform simply isn't ramping fast enough, despite management's insistence that agent force is selling well. The company boasted about some notable customer wins. They talked about a PepsiCo open table. Hey, Falabella, that's the largest department store chain in South America, if you didn't know. But while agent force definitely has some momentum, it's growing off a very low base, which means it's not yet big enough to truly move the needle.

And that's what worries people. Let me put it this way. Last week, the company know that AgentForce had reached $100 million in annual recurring revenue for just two quarters. That's the fastest growing product in Salesforce's history. That's great. But Salesforce is on track to bring in more than $41 billion in sales this year. So $100 million in AgentForce sales, well, that seems like kind of a rounding error to me. All right, so how come I'm sticking with this one? Maybe I'm a loser. It's been said.

Look, I can't dispute that the growth of the core business is slowing here. But that's, I think, simply the law of large numbers. You could say the same thing with virtually any mature business. I saw it happen to Oracle, although, of course, the price of earnings is low. I don't care that old Salesforce is seeing slower growth because it's also seeing a significant increase in profitability. People are treating this like it's an ailing revenue growth story. And that's why they bought Informatica to kind of hide it.

but it's increasingly become an earnings growth play, and the earnings growth is excellent. And Informatica doesn't worry me. As for the other legs of the controversy, again, the Informatica deal and the Asian Force ramp up, I've got to give you what might be a really unsatisfying answer. This is now a show-me story.

I hear Benioff's arguments for why informatics is good for Salesforce, but I understand why the market's unconvinced. He'll have to prove over time that the deal makes sense. I don't think Mark wants to sit there and buy back a lot of stock like Apple has done. He's itching to buy more businesses if they're additive, if they make the company faster going, if they augment agent force. I see nothing wrong with that, but I don't mind big buybacks either. Now, how about this agent force?

Again, Salesforce will just have to prove that the price will winner over time. What do we really want to see? Well, I'll tell you what we really want to see. We want to see more boldface customer wins. But more importantly, we need to see companies that use agent force engaging in large scale. Yes, layoffs. Now, no one in this business will ever admit this, but corporations are excited about all this stuff because it allows them to fire people.

Salesforce basically needs to prove that agent force can replace lots and lots of expensive white collar workers and all that health care costs and everything else with something that doesn't cost a lot at all. Or else it's just what happens is AI is just some additive, but not revolutionary in what it does to the enterprise. In the end, I'm going to stick with Salesforce because they got an incredible track record. Every time there's been something uncertainty about the company's outlook, the right call was to trust Mark.

Benioff and his team. Plus, at this point, the stock's gotten surprisingly cheap. The numbers keep rising, yet the stock's struggled. I mean, the Dorothy's over 23 times earnings. That's the cheapest Salesforce has been in ages. Over the past five years, it's traded about 41 times earnings on average. Right now, I think you're getting a steal. But

But here's the bottom line. Salesforce is hated here because Wall Street doesn't believe in the Informatica deal or in the core business. They think it's slowing. And the idea that agent force can somehow grow fast enough to make up for that difference. This is a moment where you need to have some faith in management. I have faith. But you need to decide for yourself if you're willing to trust Mark Benioff and his team. Because ultimately, that's all this comes down to. And for many, I know that's just not enough. We have monies back after the break.

Coming up, Dell had a strong quarter, so why did investors not compute? Kramer's taking a closer look at the PC player's results next.

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You'll love this. Last Thursday night, Dell Technologies, we all know it, reported a set of numbers that confounded Wall Street. I thought it was a good quarter, but the stock still dropped more than 2% on Friday before sinking another 2.9% on Monday. Now, today, Dell snapped back like a cold spring, rallying 3.5% as part of a broad semiconductor-led move. But it's still not back to where it was before earnings.

As I mentioned at the top of the show, last night, Dell got hit yesterday because The Wall Street Journal reported that the Trump administration is looking to reduce spending with 10 technology providers, including Dell. And honestly, when the stock initially sold off on Friday, that probably had more to do with President Trump's increasingly belligerent attitude toward China, given that Dell has plenty of China exposure. This is what's happening every day. It makes it very difficult to analyze stocks.

Honestly, that almost makes it worse, though. Dell pulled back after the quarter for reasons that have nothing to do with the quarter and everything to do with the White House. OK, but I hate to see a strong quarter go unappreciated like this. So before it's too late, I want to highlight everything that's going right at Dell, even though I know it's bounced back.

back. First, let me give you some background. I'm a huge fan of Michael Dell for decades, decades. I've been bought from Dell stock ever since the return of the public market in late 2018. Since the end of 2018, Dell's up more than 350 percent, trouncing the 242 percent gain in the Nasdaq 100 over the same period, to say nothing of the paltry 138 percent gain in the S&P 500.

That's a terrific long-term move. But, man, I mean, I looked a lot smarter a year ago when Dell spiked to just under $180, mostly because their server business is a key partner for, yes, NVIDIA. And 12 months ago, Wall Street was still in love with the AI infrastructure boom. We saw a little love today, but who knows? Since then, it's become a slog. Dell fell 63% from an all-time high to a low of $66 after the Liberation Day fiasco.

In April, for recovery over the past couple of months, making it back to around 112 as of today. What a wild trader. I don't want to get too bogged down explaining the stock's agonizing decline. Initially, it was just exhaustion after a tremendous year and a half run. But then there were rolling concerns about enterprise tech budgets and the durability of AI infrastructure spending.

In recent months, though, the weakness in Dell was all about tariffs because they still make tons of merchandise in China. Companies trying to diversify away from people's republic, but it's going to take some time. And that's why the stock had that final leg lower in April, including a decline of nearly 25 percent in the two days after the Liberation Day tariff announcements. And it's why the stock rebounded from its lows after the White House paused or rolled back its most aggressive tariffs on imports from China.

Throughout all of this, I've tried to keep my eyes on the prize, which is that AI infrastructure spending is still going strong. And Dell can clean up selling servers as huge companies spend fortunes to build out data centers. So far, though, throughout all the noise of the last 12 months, none of that's looked at all impaired.

The bull thesis was perfectly intact. It's just that the stock got much cheaper, now selling for just 12 times this year's earnings estimates, when it was trading 23 times earnings a little over a year ago, shrinking to the multiple. And when Dell reported last Thursday night, I think the story only got better. Granted, the headline results were mixed. A solid revenue beat paired with a meaningful earnings miss. Drilling down, the PC business trounced the sales estimates, while the servers and storage business came in a little light. Signs kind of mad, doesn't it?

So then why am I so enthusiastic about the darn quarter? First and foremost, because Dell's guidance was fantastic. For the current quarter, the company expects revenue of $28.5 to $29.5 billion. Do you know that analysts are only looking for $25.3 billion? That's insanely better than expected. That's like an NVIDIA beat. We're talking 16% revenue growth at the midpoint for a company that's been around forever. On top of that, management says they can earn $2.25 per share for the quarter, $0.17 higher than what Wall Street wanted.

The company also reiterated its full-year sales forecast despite the miss for the first quarter. Dell raised its full-year earnings outlook by $0.10 to $9.40. The analyst was looking for $9.31. More importantly, on the conference call, management made it clear that this robust forecast

includes the impact of trump's tariffs ceo jeff carmine's been there forever i love him explain that their guidance quote includes everything that we knew know about tariffs as of today you know that's a big issue we want the companies to build it in we don't want the ones that don't okay unfortunately we can't put this issue to bed because the president loves being unpredictable but at least dell seems like it has the tariff situation somewhat under control

Clark also gave a little call on the cadence of the quarter, how it's going through, saying February was solid and improving for January, and March was better than February, although there was what he called a speed bump in North America when things slowed down after the Liberation Day announcement. Maybe that spooked some people, but Dell doesn't seem all that worried about it.

Now I've said the best part for the last. Okay. Remember, keep your eyes on the prize. Focus on the secular growth story, meaning the AI infrastructure story, which hasn't shown any signs of slowing. And Michael Dell is certainly a complete believer. In fact, Dell's AI-related businesses are on fire. The company said it generated 12%.

$12.1 billion in AI orders in the quarter, which surpassed the entirety of the company's shipments in all the previous fiscal year. Wow. They now have a $14.4 billion backlog of AI business. The estimates are a bit shakier for these AI lines, but according to data from Bloomberg, the analysts were only looking for about 5 billion AI orders and an AI backlog of less than 8 billion. They were dramatically shorter.

Things were much better than people thought. In short, Dell's doing much better than anyone believed. And that's why the guidance for the current quarter was so strong. And it's another reason why the stock should be bought. As Jeff Clark explained it, quote, we've built a strong reputation for deploying large-scale clusters quickly and reliably, significantly reducing time to first token and accelerating time to value for customers, end quote. Dell offers great customer support, too, ensuring reliability and performance after the products are shipped no longer much.

No wonder Michael Dell's in the front row when I go out there to see Jensen at that GTC conference. We were also heartened to see signs of progress in the AI PC, which initially got a lot of hype, but never really took off. Now, though, Dell says enterprise customers are upgrading to Windows 11 machines, many of which are AI PCs. The consumer side of the PC business, it's incredibly weak. Sales were down 19% in the quarter. Hey, but look, that was more than offset by the strength of the enterprise side. That's the side we care about. One last point.

During the quarter, Dell returned a record $2.4 billion to shareholders, including the repurchase of almost $2 billion in shares at an average price of $90. That's almost as much as the $2.6 billion the company spent on repurchases all of last year. And Dell's CFO said on the company's call that the repurchases reflect management's, quote, continued confidence in the business, end quote. And Dell's

Quote, ability to act opportunistically during periods of price dislocation. End quote. That is Michael Dell. That's his view on the stock. Putting it all together, Dell deserves a lot more credit for the quarter reported last week. The bottom line, their AI business is on fire. And more generally, the company's on track to grow sales by 8% and earnings by 15% this year despite tariff headwinds and economic uncertainty. At 12 times earnings? That's enough for me to stay bullish on Dell waiting for the day that the fundamentals matter again. Buy, buy, buy!

Let's go to Melissa in Florida, please. Melissa. Booyah, Jim. This is Melissa from Groveland, Florida. Fantastic. My nickname is Sunshine. I'm an elementary school counselor by day and investor by night. Sunshine, you do it all.

That's right, Jim. I'm a first-time caller and a huge fan of the show. My stock of PayPal, it has been looking pretty stormy. Since 2021, it's down more than 60%. Should I hold for brighter skies?

or rotate into something with more shine. Come on, Sia. Listen to me, sunshine. Alex Chris is really coming. He did not deliver in a couple of quarters. I now think he is ready to roll. I like to stock the PayPal. It is a crowded space, admittedly.

And, you know, there's a lot of companies that are trying to do the somewhat of the same thing, including a firm. But I will tell you that I think Alex Chris, he'd be the man and he will get you where you have to go. And thank you for the kind words and for the call. She made me feel like Jimmy Chilk.

i've been chilling i know i have been all right dell's ai business is on fire and the fact it's able to grow sales and earnings with all the headwinds well that's enough for me to stay bullish in this company as a whole boy we have so much man by the head it's scary a fresh look at what the charts are telling us about the prices of crude oil and the dollar where that's headed that is the gp's budget bill makes its way through congress could an under the radar provision

provide a new path to retirement for Americans. I'm going to share the details and, of course, all your calls. Rapid fire. Tonight's edition of The Lightning Round. So stay with Kramer.

With the price of oil now down at 63 bucks a barrel, can it stay this low? And just as important, what does oil in the 60s mean for the rest of the economy? To answer that question, we're going off the charts with our resident commodities expert, Carly Garner. She's a brilliant technician. She's the co-founder of DeCarli Trading. She's the author of Higher Probability Commodity Trading. Now, Garner's pretty bearish on oil here, especially in the context of what's happening to the U.S. dollar. She thinks the greenback's likely headed for a major rebound.

unlikely fight what many people think but that's her thought and given that all commodities are priced in dollars well that's bad news for crude so why don't we start with oil garner points out that commodities tend to experience bear markets more frequently than they experience bull markets did you know that and the bear markets also tend to last longer and

As she sees it, oil is very much in bear mode, and that bears nowhere near going into hibernation. Take a look at this weekly chart of West Texas Intermediate, WTI crude futures. Garner notes the crude peaked way back in March of 2022.

just after Russia invaded Ukraine. So far, it's never really recovered. For years, though, as oil worked its way lower, as it would always run into a nice kind of floor of support. And where's that floor of support? $65. OK, always holds there.

That wasn't natural. It was OPEC stepping in to tamp down production every time that oil got too low. Now, I've got no love for OPEC, and these countries aren't idiots. They know that nothing good happens when oil sinks below 65. Unfortunately, that's exactly what happened in April after the Liberation Day tariff announcements, and now $65 has gone from a floor of support to a ceiling of resistance.

How about that? As Garner sees it, this is an ugly situation developing here for the oil market. In her view, it can't escape from this bearish run unless it breaks out above $73 a barrel. And even then, you've got another ceiling of resistance at the 200-week moving average. So you see what she's got. The yellow one is 200-week. So she says, even if you got up here, you'd still bump into that wall. Okay?

Yeah. So even if all the oil bulls win the battle in the next few weeks, which doesn't think it's going to happen, Garnett still expects them to lose the war somewhere in the 70s. More likely, though, she's betting that crude will fail to break through 65, leading to a watershed move lower. Keep in mind, when you look at the relative strength index, RSI at the bottom, it's an important momentum indicator. It's not yet in oversold territory. It has to go down there.

To Garner, this decline unlikely won't end until oil becomes oversold. Now, historically, $65 per barrel has been a pivotal price for crude. And you can see that on this longer term monthly chart. When crude broke below $65 all the way back in 2014,

It continued going lower until it reached 26 bucks. I mean, that was just unbelievable when it did that. And that was in early 2016. And the 2018 breakdown eventually ended with a plunge. And the negative price is a few years later, in April 2020. So you can see when oil break, there was that critical negative.

I mean, there were just no buyers. So if oil can't climb the size of above $65, Garner thinks gravity will come into play. She wouldn't be surprised if crude drifts down to the low 50s or even the high 40s. After all, oil spent most of Trump's first term trading at below 65. Plus, just like the weekly chart, crude's a long way from oversold in the monthly chart. Meaning it still has plenty of room to go lower. Should be done like that.

What about the pin action from lower oil? OK, take a look at the monthly chart of oil in black and the dollar index in green. OK, the dollar index measures the greenback against basic foreign currencies. Normally, oil and the dollar have a negative correlation. They're supposed to trade in opposite directions because oil is priced in dollars. By definition, a strong dollar means cheaper oil and a weak dollar means more expensive oil. But ever since Russia invaded Ukraine in 2022, oil in the U.S. declined.

They, the U.S. dollar, have almost been trading in lockstep. You can see black and green. So you can see these are in lockstep. You can't even tell which one's which, right? Over the past 180 days, Garner points out that oil and the dollar index have headed in the same direction about 70% of the time, and that is highly abnormal. However, in recent weeks, Garner started to notice a gradual return to normalcy. In the last 30 trading days, oil and the dollar index have basically zero correlation, okay?

So there's hope here that we'll go back to what she suspects they were headed back to the historic norm, where they tend to trade in the opposite direction. Now, in recent months, the dollar's been weakening, which would be good news for oil if it keeps getting weaker. But when Garner looks at the data, she sees signs that a significant dollar rally might be headed our way, which would put real pressure on the price of crude.

For starters, a recent Bloomberg article stated that sentiment on the dollar is, as measured by the options market, is as bearish as it's ever been, literally at its lowest level since 2011. Norman's sentiment on the dollar gets this bearish. Garner points out that it tends to bottom. The last time the dollar sentiment got anywhere near these lows was in 2020. But in the first few days of 2021, the dollar index bottomed at just below 90 and then rebounded to 115. Now, she's betting that this is

Well, we're about to have a rip your face off rally here. Similarly, in 2018, overly pessimistic sentiment triggered a dollar index rally from under 90 to 103. The aggressive sell American trade that we all think is going on, it's working against the dollar, will climax in the coming week, she says, allowing the greenback to make a major comeback, she said.

Even though we have a lot of craziness in this country, including a multi-front trade war, Garner says that the dollar should remain the world's currency for the simple reason that it's the least dirty shirt in the hamper. The dollar is the most liquid, the most stable, and it's most backed by, it's got the most productive assets. We are a rich country. Now, I want you to look at this monthly chart of the dollar index. During Trump's first term, the dollar index fell more than 15 points. Okay, Trump won.

from 104 down to 88 and change. It eventually bottoms as he was leaving office on a lower level of a long-term price channel. The incident Trump 2.0 took control of the White House, the dollar index began to collapse from the same trend line, just like we saw in 2017. A 15-point decline from the day Trump was sworn in would put the dollar index on a monthly uptrend near 95, right here. Garner suspects that this is the level where the sellers dry up and the buyers are going to jump in.

Now, just like in Trump's first term, the dollar is an opportunity to make a run to the top of the channel before retreating. Now, this would mean a rally back to 110. Right now, Garner says almost no one's considering this possibility. And she is right. I don't know anyone who is. Yet the chart, combined with overly bearish sentiment, makes her believe that it's not merely possible. She thinks it's therefore probable. If Garner's wrong about the dollar index finding a bottom at 95, then she believes that 90 would likely be the floor. That would represent a full retest of the decline from Trump's first term.

At the end, though, she's betting on a dollar rally. Historically, the price of oil has traded between 30 and 65 a barrel in a high dollar environment. Here's the bottom line. The charts in this very contrary piece, as interpreted by Carly Garner, suggest the bear market in oil is likely to continue, especially if the dollar starts rebounding. But even if she's wrong about the dollar, Garner says the technicals look pretty ugly as long as the price of crude stays below 65.

The longer it stays stuck below that level, the heavier the oil market will become. Bad news for the oil industry, but very encouraging if you're worried about inflation. Bad money's back here for a break. Coming up, Kramer takes your calls and the sky's the limit. It's a fast fire lightning round. Next.

It is time. It's time for the Light Round Quiz. And then the lighting round is over. Are you ready, Skeet? Time for the Light Round Quiz. We start with California. Who is that? Cy in California. Cy. Hi there, Jim. How are you? I am good, Cy. How about you?

I'm great. Jim, you used to comment regularly, somewhat regularly, on good RX, and you haven't said anything in a long time. Well, sometimes, like my Nana Mary said, if you don't have anything good to say about someone, don't say it at all. All right, let's go to Monty in California. Monty! Hey, Jim, how are you today? I'm calling you about Arrowhead Pharmaceuticals.

You know, look, it doesn't make any money. I've been waiting for it to do something, break out. I just don't know if it has the horses. Let's go to William in Michigan, William. Guillaume, Guillaume, speak to me. Hi, Jim. Thanks for taking my call. Of course.

I'm a member of the Investment Club, and I appreciate the support you provide for retail investors. The company I'm calling about is Snowflake. Oh, Snowflake spoke it. I mean, it is just, you know, I was thinking about this, but Ramaswamy first comes in, not sure, then he takes off. And why? Because the guy is cerebral, and he's got a real good closing sense. And man, does he ever have momentum. He is project momentum.

Let's go to Henry in Colorado. Henry. Hey, partner. How you doing? I am good, chief. What's taking with you?

Everything good here. I want to get your opinion on if you think Dover will ever hit 222. I look wrong right now on Dover for the club, and thank you for the kind comments from the club. But I think I'm going to be right. Why? Because I think that Tobin is very smart, the CEO, and the stock should never have been thrown back 19 times earnings. It even went down when Steel Towers went on. I say enough is enough. Buy Dover right now, tomorrow morning. How about Sam Pennsylvania? Sam.

Jim, listen, I got an interesting stock for you. The company is trading at $4 billion, but it did $16 billion in revenue last year. What makes it interesting is it sits right at the intersection of onshore and remanufacturing, the reindustrialization of the United States. What I'm talking about is floor. This is

Floor's always a bridesmaid, never a bride. I mean, that engineering construction, but people have lost money more on floor than... I actually did a study for Harvard that owned floor. And I said, you got to sell floor no matter what. And that was in 1982. And that, ladies and gentlemen, is the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab.

Still to come, could the U.S. be trying to usher in a new baby boom? Kramer's betting on how you can make the Big Beautiful Bills baby bonds bring the best bang for your buck. Next. Jim Kramer, the diehard of the dollar. Hey, Jimmy, love the show. My five-year-old grandson loves to watch your show. I have to thank you for making us money when it's there to be made. Our world is a better place with you in it.

Like any gargantuan piece of legislation, the one big beautiful bill act wending its way through Congress is packed with juicy giveaways to all sorts of powerful groups with expensive lobbyists. But there's one cause that's an unlikely benefactor of the bill, a baby bond provision that would give every baby born during Trump's time in office a

$1,000. These so-called baby bonds should be called baby stocks, although officially they'll be known as trumpet caps. Say what you will about the president. The man understands branding. I don't know how much of the bill will get through the Senate, but I think the baby bonds have a chance of passing.

House of pleasure. Senator Cruz from Texas says the purpose is to create a shareholder democracy. And boy, am I on board for that. This morning, an op-ed in the Financial Times, our foremost thinker about markets, Larry Fink, the co-founder and CEO of BlackRock, praises the policy as he puts it, quote, even a modest deposit can grow by the age of 15 to retirement cushion, end quote. Larry's an apostle of investing, and his piece talks about

all sorts of investment possibilities that we could take advantage of, even if most Americans seem reluctant to do so. Look, we're just not great at saving. Europeans save three times what we do. But there's hope with these baby bonds because someone who starts out with $1,000 from Uncle Sam might be willing to take big risks with it. That's precisely what I do. When you give money to a baby, what you're really doing is investing in long-dated acids that can compound over time, truly amount to something by the time the kid turns, I don't know, even 18. So what should the baby do with her money? Well, I just happen to have a plan.

We need this baby to take risks, but we also need her to be diversified. I know that the veiling money management orthodoxy is to go all in on index funds because the experts don't believe you're smart enough to handle your own money. But the truth is that in this case, you can split the baby or at least split the baby's account. You want to put $500 in the NASDAQ 100 to get diversified exposure, although

And this one does skew toward tech. I don't mind that. And then you want to pick five stocks for the other 500. I prefer the first one to be risky. You could take a Palantir, ridiculously expensive stock. Consulting company uses AI to conquer organizations, show them how to become more efficient. You can buy Joby or Archer. Go ahead. Flying cars, quantum computing. I don't mind. Yeah, something nuclear. Let's go at least a legitimate one like G.E. Vranova because they actually know how to build nuclear plants. Basically, this first position is the highest risk speculative stock, even meme stocks.

Then I want a solid health care stock, maybe Vertex with a cystic fibrosis franchise, but also that revolutionary non-addictive painkiller. Maybe buy an Abbott Labs. I have a Boston Scientific. Of course, you can always bet on Eli Lillard with GLP-1 drugs. You need a semi-

That means you need a video. You need a software. That means you're going with Microsoft. And then a wild card. Want to go with Costco. Inflation fighter. Now, $1,000 is great. Thank you, Uncle Sam. But how about this? $100 every month divided among those two categories, the NASDAQ 100 and individual stocks. And who knows? Maybe your baby can retire off that Trump account as long as you just keep putting in a little more money and letting those two saving systems grow.

I like to say there's always a bull market somewhere, and I promise to try to find it for you next on Mad Money. I'm Jim Cramer. 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.

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