It may seem hard to believe, but it only takes four small words to sell a stock market. The four words were uttered by Federal Reserve Chairman Jay Powell, Jim Kramer told his Mad Money viewers on Tuesday, “they were a few months ago.”
Powell was referring to the Fed’s bond-buying plan, a plan he had already said would end as the epidemic eased. But Powell said Tuesday that bond purchases would be completed sooner than expected – it was all that was needed to scare investors.
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The news was obvious, Kramer explained, but the timing could not be worse, given investors’ concerns about the Omicron version.
What does all this mean for an average index fund investor? “Not much,” said Kramer. Individuals are buying long-term stocks, which makes today’s short-term weakness nothing more than an opportunity to buy.
He was cautious, however, telling viewers to wait until the first confirmed case of Omicron here in the United States.
At the same time, investors can still buy tech stocks like Amazon (AMZN:) – Get Amazon.com, Inc. report:, ServiceNow: (NOW) – Get ServiceNow, Inc. report:, Microsoft: (MSFT:) – Get a Microsoft report և Vision (TSLA:) – Get a report from Tesla Inc.. They can also buy dividends that will continue to do well in this environment.
Finally, it is better that the Fed announced its plans. Now that the damage has been done, the markets can start moving.
Executive decision: Salesforce.com
In his first Executive Decision, Kramer spoke with Salesforce CEO Mark Benioff and Brett Taylor. (CRM:) – Get salesforce.com, inc. Report:. Salesforce announced today that Taylor will join Benioff as CEO. Shares depreciated by 6% in one day, along with wider markets.
Taylor has been CEO of Salesforce for more than five years, and he said he is excited to be working with Benioff in the next chapter. Benioff said he has no plans to leave the company he founded, he still enjoys talking to all of the company’s customers and stakeholders.
Demand is high for Salesforce, Taylor said, despite the company’s cautious guidance. He said core CRM և service clouds continue to grow, և Slack exceeded expectations by more than $ 30 million.
Benioff added that with $ 26.4 billion in revenue this year, the company forecasts $ 31.8 billion next year. Salesforce continues to grow faster than expected.
Executive decision: PayPal
For his second “Executive Decision” section, Kramer also spoke with PayPal CEO Dan Schulman. (PYPL:) – Get PayPal Holdings, Inc. report:The payment processor, which saw its shares fall from $ 310 a share on Tuesday to just $ 185 as fintech became a Wall Street favor.
Shulman first announced the start of the holiday shopping season. He said that digital sales are unchanged this year, after growing by 50% last year. Retail trade, however, fell by 26% in 2019 compared to before the epidemic. These trends show that online shopping remains.
PayPal forecasts 55 million net new active users this year, և Shulman said that number remains high. The company is also expected to reach 750 million total users by 2025.
When asked about the popular buy-now and pay-per-view space, Shulman said that PayPal is not one of the top four players in the world. Buy Now, later paid sales on Friday increased by 400% compared to the previous year.
Shulman also commented on the news that PayPal is in talks to acquire Pinterest (PINS:) – Get Pinterest, Inc. Class A report. He said that PayPal reviews hundreds of potential achievements every year and talked to many companies. He added that PayPal does not need to be acquired to comply with the guidelines.
Finally, when asked about competition like Shopify (SHOP:) – Get Shopify, Inc. Class A report և square (SQ:) – Get Square, Inc. Class A reportShulman noted that one in four transactions on Shopify is powered by PayPal, so with the growth of e-commerce, so does PayPal.
Omicron և your portfolio
In an exclusive interview, Kramer reviewed Dr. Eric Topol, founder and director of the Scripps Research Translational Institute, most recently about Omicron, what it means for your portfolio.
Dr. Topol said that all travelers from Africa to the United States are being tested and tracked, but so far the Omicron has not been found. It is almost inevitable, however, that the fast-spreading version will eventually make its way to the USA.
There is still much we do not know about Omicron, including whether the virus is different enough for our immune system to make our current vaccines ineffective. However, we do know that after receiving stimulant injections of our current vaccines, the immune response is strong և broad, so it is likely that it will be detected.
The main advantage of Omicron is that everyone should get an amplifier. Topol said that we always knew this was a three-shot vaccine, we just did not know how long the first two doses would take until the third vaccine was needed. We now know that the schedule is now.
We can not all be right
In his No-Huddle Offense segment, Kramer offered some context for today’s sale. He said that today there are four types of sellers. The first group is afraid of inflation և will use all the opportunities to scare you from stocks. The second group knew that the Fed would tighten, but it did not expect so soon. The third group is just trying to close its profits so that they can buy back at lower levels. And the fourth group is worried about the slowdown of Omicron.
The problem is, not all of these groups can be right. If there is a slowdown, the Fed will not tighten so quickly. And if the Fed is really tightening, then things should not be as bad as we thought. This means that buyers will return to the market soon, so it makes sense to use the weakness to make some purchases.
Here is what Kramer said about some of the shares that callers offered in Mad Money Lightning Round on Tuesday night.
DigitalOcean: (DOCN:) – Get DigitalOcean Holdings, Inc. report:“I have always liked this kind of company. However, this is a large number of shares, which is why it is declining. ”
Vaxart: (VXRT:) – Get Vaxart, Inc. report:“One can make assumptions, but this was not a winner.”
Gores Guggenheim (GGPI:) – Get Gores Guggenheim, Inc. Class A report“I do not support this group.”
ThredUp: (TDUP:) – Get thredUP, Inc. Class A report“This is a product now, I say no.”
Nokia: (NOK:) – Get a Nokia Oyj report“I warmed up with Nokia.”
Delta Air Lines: (DAL) – Get Delta Air Lines, Inc. report:“Delta is interesting. This is a very good company, one of my favorite airlines. ”
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