Mad Mail: Is J&J a Buy?

BOO-YAH!: As young investor, at the University of Iowa (See you Nov. 12!), I got a CD right before the fed started to slash rates. The CD expires in less than a month. What should I be looking to buy? Would a portfolio of high-dividend consistent growers be good? Or since I'm young, should I be more risky and buy companies such as Research in Motion and Goldman Sachs ? See you at the University of Iowa! --Spencer

Cramer says: “I would do a mixture like I do for my charitable trust.” Buy Abbott Labs or Apple for growth. You could also buy Kinder Morgan Energy Partners for its good yield. And if you like CDs and you want to keep it conservative, pick up some of those Verizon bonds that were just priced. They offer 8% to 9%.


Cramer: Recently, you were bullish on Johnson & Johnson. The other day, J.P. Morgan downgraded JNJ to neutral. They state this is due to "trading at a 27% premium to the sum of its parts." Were they able to do this math in August and September while it was trading around 70? Why are they trying to take money out of JNJ during this recession, while you say it's the best time to be in this company? Is this an example of the "Wall St. Gangsters" at play? Do you still believe in JNJ? --Tim

Cramer says: “I don’t like the call…what a silly call this is because we’re going into a recession. JNJ’s great.” Consider buying the stock now that it’s down because of that call.


Booyah Jim: The founding of Cramerica in 2005 was a triumph for the common man unlike any other in the 21st century. The quality of education on Mad Money is unsurpassed, as are the four books and the stimulating humor. Question: In shopping for high dividends, I have found a multitude of REITs yielding 20% or better. Are REITS expected to bottom before housing in 250 days? Could you coach us Homegamers on what to look for? Thank you for the deep insights to the street that have never aired on television, or even been considered in college classrooms. --Tom

Cramer says: “REITs are case by case, OK?…those REITs that are yielding 20%, I don’t trust them. They probably will have trouble covering their dividend. Stay away from those.”

Jim's charitable trust owns Abbott Labs, Goldman Sachs and Johnson & Johnson.

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