In today's Daily Rundown, Jim provides takeaways from this morning's interview with Dow Inc (DOW) CEO Jim Fitterling. He also discusses recent news about CVS Health (CVS) , UnitedHealth Group (UNH) , and Facebook (FB) .
Katherine Ross: Hey, y'all. I'm Katherine Ross with Action Alerts PLUS. I'm here on the floor of the NYSE with Jim Cramer. Jim, you just sat down with Dow's CEO. You guys talked a lot about Plastics. What's going on there?
Jim Cramer: We went over the quarter. We went over business and obviously the Charitable Trust owns it but then I felt that we have to deal with the plastic issue. It's not about friends, it's about money.
Jim Cramer: I think the plastic issue looms very large for them. I think that when you see plastic bags being outlawed basically and when you see the straws go to paper, I think you have to say maybe, how much does it matter? What are they doing? What are they doing to not just have it recyclable but is it going to be recycled?
Jim Cramer: I think that the reason I pursued that line of questioning very aggressively is because I think that we have to be concerned that millennial portfolio managers won't buy it and that, I wanted everything on the table.
Jim Cramer: I didn't think it was an uncomfortable line of thought. A lot of what I did was because my kid said, when will you demonstrate the more than just, let's say the drivel of, as they were saying, of that I have a mission and I'm purpose lead.
Jim Cramer: If you're really purpose lead and you have a mission, why don't you ask the real questions? And I took my kids up on that. Now, it's uncomfortable but I think that if you talk about plastic, you talk about the numbers but you talk about what the oceans have done.
Jim Cramer: I don't mean to pick on Jim Fitterling, he's a very distinguished material scientist. But I do think that if you ignore that problem, then you ignore history.
Jim Cramer: I think that plastic is a very big issue for the environment and I think the environment is incredibly important and I did not, after talking about the numbers, I would not be able to live with myself if I didn't talk about what plastic has done.
Jim Cramer: It's not the fault of Dow but I think you have to ask yourself, why are we not using glass? Why are we using plastic? What are we doing to actually recycle because we're terrible recyclists.
Jim Cramer: And I do feel that sometimes when you do my job, you have to ask yourself, okay, what can really hurt a stock? And what's going to hurt Dow stock and we own it for our Charitable Trust, is if portfolio managers think plastics going to go away.
Jim Cramer: When you wake up and they've suddenly outlawed bags, plastic bags. My father switched from selling plastic bags to paper bags, my late father, 19 years ago. And he worked for the Chinese and he realized that, like we have as bag at Bar San Miguel, that you can make a really good paper bag with great strength, tensile strength and not use plastic because he felt that plastic was going to go away.
Jim Cramer: I think my father was right and I think my kids are right. I still think it's good business because they have a lot of other plastic other than the stuff that we're talking about. But I think that you must ask these questions because it determines what the price to earnings multiple is and I have no regrets.
Katherine Ross: And I think that plastic is a huge issue and I know, adding in a millennial perspective here, I know a lot of my friends care about that.
Jim Cramer: Right.
Katherine Ross: And that is something that they actively, they'll go to Trader Joe's or they'll go to Whole Foods to purposely get non plastic bags.
Jim Cramer: My daughter said that if I had those bottles, the plastic bottles of water. I have a bad back so I haven't had the big bottle, but if I have those plastic bottles of water when she comes to our house again, she's just going to leave.
Jim Cramer: I think she's not alone. As a matter of fact, I think that eventually, she's going to be the majority. So, you have to ask these questions. You have to.
Katherine Ross: And you guys are holding DowDuPont.
Jim Cramer: Yes, because we believe that it's got a great yield and that the questions that Jim Fitterling answered, were satisfactory to us. But they must be asked and a lot of what I have to do is uncomfortable because I am ... There's no free passes.
Katherine Ross: Let's talk about CVS. CVS is getting hit because of the Walgreen's-
Jim Cramer: CVS saw this coming and they made dramatic changes and became a healthcare company. No one cares today, believe me. And no one will care tomorrow because people hate that stock, I mean they hate it.
Jim Cramer: And it was a mistake. It's not a mistake down here. It was mistake. One of the things when you run a public fund like I do and no one else does, may I add, you're going to make mistakes and their going to be glaring, which is why when do our call next week, we talk about them.
Jim Cramer: One of the things that portfolio managers do is make mistakes. Just that they are hidden, they're hidden. But I'm not hidden because I'm trying to explain how it really works.
Jim Cramer: It opens me up to tremendous ridicule. So, why do I do it? Because if I can't do it, who else can?
Katherine Ross: I agree there. Zev Fima had a great note last night on medicare. What do you think about that? What does it mean for CVS and UNH?
Jim Cramer: I think that medicare, it's better for Aetna but Aetna is owned by CVS and people are not going to talk today about CVS. Larry Merlo, I think has done a remarkable job putting this company together, but it doesn't matter today.
Jim Cramer: What you do is, you just say, okay listen, this is a pain taking day. Now, people don't want to take pain, and they'll want to sell. But when you sell because you're desperate, and you're feeling bad, it has historically been wrong.
Katherine Ross: Kathy K's got a question for you.
Jim Cramer: Sure.
Katherine Ross: She's wondering, what should she do with UNH?
Jim Cramer: With which one because this guy really talks way too loud.
Katherine Ross: UNH.
Jim Cramer: We're going to have to move. With UNH? I think UNH is in right now, purgatory because people believe that somehow Nancy Pelosi, and the president are going to come up with something that makes it so that there's going to be dramatic changes to healthcare. That is not true. There won't be and that's why we think you got to stick with UNH.
Jim Cramer: I know that again, out of favors stock. Not all your stocks are going to be Nvidia. And I think that what you have to recognize, do I feel right now at this very moment, that there should be no Action Alerts? No, I think it's great.
Jim Cramer: Should there be no club? I think the club is about education. If you want to single out CVS as a miserable mistake by a guy who's a has-been, I say, go ahead. If you think that, I don't care.
Jim Cramer: The has-been picked Apple at five. The has-been said stick with Apple. The has-been said buy Facebook at 17, 20. The has-been is not as has-been as you think.
Katherine Ross: You still have a TV show on CNBC.
Jim Cramer: Well, let's think about it. Do you think I have to work?
Katherine Ross: You work hard. You're in before me most days.
Jim Cramer: Well, I work hard. I got up at 3:30 to see how the market is, write a piece. I am possessed by why J&Js down right now. I think people should buy Xilinx.
Jim Cramer: I come to play and I will always come to play. Just like my father, when he was 92. In his last month alive, he had a great month. So, sticks and stones may break my bones, which is why I carry nuclear weapons.
Katherine Ross: Now, to wrap this up, I've got one question for you and that's about the Deutsche Bank note on Facebook, which is focusing on Instagram and how Instagram's expanding.
Jim Cramer: Instagram's great, $10 billion, it's why we like Facebook. We wish that they would rename themselves Instagram. But that's the secret. It's the way you reach the coveted millennial demographic, and the way you reach them is through mission led purpose driven statements like Zuckerberg made yesterday, two days ago in the Washington Post. If he lives by them, the stocks going to go much higher.
Katherine Ross: All right, Jim, thank you.
Jim Cramer: Okay. Thank you.
Katherine Ross: See you guys tomorrow.