It was just 10 days ago when it seemed to Jim Cramer that the world was falling apart, and there was intense pressure to sell everything and buy Treasurys. Now, that panic seems to have faded away with Monday's production of a terrific rally.
So what the heck happened that made things better?
While the primary catalyst in Cramer's opinion was oil and futures, there was another factor that he thinks is being overlooked by everyone.
"Bernie Sanders looks like a paper tiger. I swear the media made this guy seem like a bona fide candidate for the Democratic nomination, but suddenly with a small loss in Nevada he is buried alive," the "Mad Money" host said.
It was also confirmed that Honeywell was in talks to purchase United Technologies, to dominate the aerospace and climate control space. While Cramer thinks this idea is brilliant, he did not know if the deal could ever be compensated because of antitrust issues.
However Cramer did speculate that Honeywell's discussions could reveal that the big capitalization cyclicals are dramatically undervalued in the market.
So even if both presidential candidates claim not to be a friend on Wall Street, Cramer interpreted the combination of two pro-business candidates emerging, oil rising, earnings forgiveness, a Chinese story that hasn't become more negative and increased M&A activity as the reason for stocks suddenly turning around.
Cramer has seen many once red-hot stocks completely cool off this year. Now that the market seems to be finding its footing again, he decided to dig through the rubble and find out what broken stocks may be worth investing in again.
The Gap is one company that has been on a total roller coaster. As the parent company to Banana Republic, Old Navy and other various Gap brands, it totally dominated the late 1990s and early 2000s. Growth slowed and business cooled off for about a decade, until The Gap launched a comeback a few years ago—and it looked to Cramer like the stock had gotten its groove back.
That comeback changed dramatically when shares of The Gap plummeted 41 percent last year. And while the stock has rebounded 8 percent this year, it is still far from its highs.
So what happened?
"Put it all together and Gap running up into the quarter feels like a recipe for disaster, at the very least a recipe for no upside," Cramer said.
Two stocks on Cramer's radar on Monday were retailers VF Corp and Columbia Sportswear, because in the end — execution matters.
Both apparel companies have a large business focused on selling winter clothing: Columbia through its namesake brand and VF Corp through North Face. Yet for some reason Columbia reported a fantastic quarter last week, and VF Corp reported a disappointing quarter.
How was this possible?
While some may think that the weather had an impact, the fact was not that it was snowing on Columbia's side of the street and VF Corp had a warm winter. Cramer thinks the reason is that Columbia is doing a better job, and has many more exciting brands than VF.
"For now, Columbia Sportswear is absolutely the better buy, and only a purchase of Lululemon by VF would change my mind," Cramer said.
There is something about the price of $30 crude that makes investors excited about stocks. Cramer wondered if perhaps it is some sort of equilibrium number that gives investors the green light to buy.
"I will say this, the slowing of the velocity of the decline in oil does create a positive backdrop for so many industries, and at this particular level, it allows for many oil companies to stay in business while they ratchet back expenses," the "Mad Money" host said.
At the price of $33, Cramer thinks oil is in a bit of a sweet spot. Gasoline finally sells at $1.77 a gallon nationally, which is the equivalent of a big tax cut for everyone. Companies are finally recognizing that the price of natural gas won't go up any time soon, so they can afford to build factories in the U.S. instead of elsewhere.
"The best of all possible worlds, therefore, might be with oil in the low $30s," Cramer said. (Tweet This)
If oil stays in the low $30s, the price of gasoline can stay under $2 and help the consumer. It could also give companies a chance to catch their breath, lower costs and stay in business.
Allergan reported a terrific quarter on Monday, delivering a 7-cent earnings beat from a $3.34 basis and higher than expected revenue.
The company also recently announced that it would merge with Pfizer in what Cramer considered to be a very smart deal. Though the stock was hit nearly 10 percent this year, it jumped more than 3 percent on earnings Monday.
With so much turmoil in the biotech space recently, is this really the right time for Allergan and Pfizer to merge? To find out, Cramer spoke with Allergan CEO Brent Saunders.
"I think it is. I think this industry is going through massive change, which requires massive consolidation. And I think this combination with Pfizer does create the world leader in biopharmaceuticals," Saunders said.
In the Lightning Round, Cramer gave his take on a few caller favorite stocks:
Eli Lilly: "I think that Lilly at $72 is just a plain out buy. I think it is very, very cheap and conceivable that it might have some good Alzheimer's news later in the year."
Spectra Energy: "I think it's OK. Greg Ebel [CEO] really does run a true utility that yields 5 percent, but I've got to tell you in the end it is going to be fossil fuel aided. That means when oil goes back down it is going to get hammered even if it shouldn't."