Mad Money

Cramer Remix: We’ve already been in a trade war for ages

Key Points
  • "Mad Money" host Jim Cramer issues a reality check on the state of trade in the U.S. and explains why it's been on the receiving end of a trade war for a long time.
  • Cramer also sits down with the CEO of Randgold to discuss the state of gold mining.
  • In the lightning round, Cramer warns investors about the stock of Seagate.
Cramer Remix: We’ve already been in a trade war for ages

After the stock market took a tariff-related nosedive on Thursday before recovering slightly on Friday, CNBC's Jim Cramer wanted to address how he reacted to the sell-off.

"I've got to apologize to you: I forgot to panic last night," the "Mad Money" host said. "I told you President Trump's move to slap a 25 percent tariff on imported steel and a 10 percent tariff on aluminum ... was not a reason to dump positions wholesale. If anything it might even be a reason to do some buying on weakness."

Cramer reiterated his message to investors that there's always a better time to sell than in a moment of panic. But he also acknowledged that these tariffs would exacerbate a central argument in the United States over free trade.

"There are way too many well-intentioned economists and politicians and businesspeople out there who believe that protectionism is always a mistake," Cramer said. "They don't understand that we've been on the receiving end of a trade war for ages."

So as investors toy with the question of whether U.S. trading partners, particularly China, will retaliate against Trump's move, Cramer looked ahead at his weekly game plan.

Analyzing the tariffs

President Donald Trump speaks at the debut of the Boeing South Carolina Boeing 787-10 Dreamliner in North Charleston, South Carolina, U.S., February 17, 2017.
Kevin Lamarque | Reuters

At the same time, Cramer wanted to take a more analytical approach to the tariffs.

First, Cramer examined the trajectory of the biggest U.S. steelmaker, Nucor. An industry innovator, Nucor has been a staple steel play for many investors including Cramer, whose charitable trust owns shares in the company.

But Nucor's story has not been without blemishes; the company has been at fault for missing earnings estimates in the past because of sub-par execution, Cramer said.

"There were also many, many quarters where, because the People's Republic of China wants to create jobs, they build steel mills and they sell the stuff well below cost and it causes our companies to have real issues and, in some cases, just wipes them out," he said.

Cramer explained that China offers companies huge steel subsidies to employ Chinese workers. Profiting from the work is more of a secondary concern, throwing a wrench in the United States' ability to compete, he said.

Cramer's strategy session: Don't bottom-fish

David McNew | Getty Images

Cramer was not a fan of Walmart's latest earnings report, and he wasn't shy about it in his "Voice of Cramerica" strategy session.

"I've got to tell you, I've spent a lot of time going over that Walmart quarter and I didn't like it. I didn't like the dramatic decline in e-commerce at all," the "Mad Money" host told a caller.

Walmart's fourth-quarter results, released Feb. 20, missed Wall Street's expectations as sales on waned.

The weakness in e-commerce overshadowed some of the retailer's more favorable results and put its ongoing battle with Amazon under a spotlight.

"I don't want you to bottom-fish yet in Walmart. I don't like the way it's going," Cramer said.

Randgold CEO on doing business amid unrest

For Mark Bristow, the co-founder and CEO of gold producer Randgold Resources, mining gold in areas rife with civil unrest is often just the cost of doing business, he told CNBC on Friday.

"We had the challenges in Mali when there was a coup d'etat. We had the civil war in the Ivory Coast. This comes with the territory in emerging markets, particularly Africa, but these are world-class assets, they can pay their end and they're very good for the people," Bristow told Cramer in an interview.

Randgold's latest venture is in the Democratic Republic of Congo, parts of which have been wrought with inter-communal violence in recent months.

"I think the challenges in DRC are part of a growing pain as sub-Saharan Africa emerges from its past," Bristow said. "And I've got, still, plenty confidence that we'll be able to continue to deliver in operating gold mines in sub-Saharan Africa."

The CEO also emphasized the value of Randgold's asset in the Democratic Republic of Congo.

"This is a 10-million-ounce deposit with plenty of upside," Bristow said. "We're going to be producing at about 700,000 ounces a year for the next five years and certainly plus-600,000 ounces for 10 years at under $600 an ounce. It's a tier 1 asset in anyone's definition."

Sell-off triggers

Cramer also wanted to caution investors about getting too complacent after the market sell-off.

"Be aware that there are forces at work that might have caused other sell-offs that might still be there lurking," he said. "When we get really overbought as we did at the beginning of February and we got hit with a real hot employment number, the market plummeted off of a blip of a move higher in interest rates."

Remaining vigilant is key when it comes to navigating market volatility, so Cramer told viewers to be quick on their feet amid the market's gyrations

"That kind of pullback could happen all over again when we get the next employment number on Friday, unless we aren't all that overbought and bonds are tame," he said. "If that's the case, the sell-off's probably almost over and you missed a darned good opportunity to do some buying."

Lightning round: When investing for IRAs, don't stick with STX

In Cramer's lightning round, he rattled off his take on some callers' favorite stocks:

Seagate Technology: "I think that's more of a trading vehicle. If you're going to do that for your IRA, I am more concerned. I would rather see an Intel. I know the yield's not that big, but I like that balance sheet better than I like Seagate's."

Deere & Company: "Deere is a great American company. I think they will do just fine, but I do think that this is not the level to buy it. It's too close to the blast zone of tariffs. Let that one come down, although I did like the quarter very much."

Disclosure: Cramer's lightning round owns shares of Nucor.

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