Business less likely to expand yet, thats what happened today. Dow gaining 81 points. S p tipping. 0. 5 . After the fed gave us its long expected quarterpoint rate hike so the answer is, yes, but yes for a reason the departing fed chief has followed the footsteps of her predecessor telegraphing her actions months ahead of time her transparency which i hope will continue under incoming chairman jay powell is the reason why the market didnt get slugged when we got the hike now, there is a whole generation of investors out there who dont know the way these fed meetings used to be back in the day when they were edge of your seat occasions. Everything was cloaked in secrecy. We never knew what they were going to do. Never had anybody to figure out why they did it beyond the boilerplate statement that was g gobbledygo gobbledygook why does the market or dow seem to like this, enjoy a rate hike . A couple of reasons. First not so much that we like it, as that investors realize rates cant stay down here forever. Even though theres not much Wage Inflation we have real estate inflation some people say we have a lot of stock market inflation rich people have free money. What they always say, free money that you have to pay for free money to play with and helping to put people to work even as we would like all companies to do more hiring. Still were almost at full employment and while we still dont have much Wage Inflation yet its easy to imagine it picking up not like the housing business. With the economy roaring the fed needs to make sure insurance doesnt rear its ugly head and erode the value of your assets including stocks it erodes your retirement money. Its important to go back to the fed mandate. Promote growth but fight inflation. Or to use a cliche, where the puck will be, the sense that inflation will come back because money is too cheap and washington is throwing acetylene on the fire. Hallelujah we cant have it get too hot because inflation is bad for business and bad for retirement. Bad for stocks and since rate hikes are how the fed combats inflation these rate hikes are inevitable we trust the feds judgment were healthy enough to handle higher Interest Rates. We like the economic report card the fed gave us and it was a good one so buyers came in off the sidelines but both because of the positive checkup but because this is the last bad event before the end of the year which means very little to worry about for the next couple of weeks except for an event with an asterisk. Thats what happened today thats history the bigger question is whats going to happen now . First i would say that a quarter point rate hike from these very low levels wont really do much damage to the economy or the stock market but we get a bunch of these, though, in an unmeasured, quick fashion and we will start to feel the pain. Although, again, yellen gave you great comfort that the fed will be wary of doing so, yellen is going off into the sunset. We dont know what jay powell will do. Higher rate also kill the bull if they make rates competitive arent there either. As my friend ken fisher reminded me today, the late Legendary John templeton, sir john temp templeton said theyre born on skepticism, mature on optimism and die on euphoria. Were optimistic at 2018 and optimistic the fed wont kill the economy. Optimistic more jobs will be created. And im optimistic stocks can keep running even though theres enough skepticism to fuel further advance as more money comes in off the sidelines now, i wish we were still in the skepticism phase theres not enough positivity to say were euphoric now, theres plenty of it for these krcryptocurrency yellen didnt seem to take the bait and didnt think theyre that important not like everything is going well we are not creating enough highly skilled jobs and our productivity isnt improving fast enough. I thought it was telling at the big job news today came from apple which awarded finesar 390 million from its advanced Manufacturing Fund that ceo tim cook outlined on the show. This investment will produce 500 new jobs and apple will buy their devices. A sub standty claim to buying america. I think finisar would struggle without aggressive deregulation we dont have enough lending lending is not growing at the pace it should its actually doing quite poorly now, some of that is because longterm Interest Rates which the fed has little control over simply havent been rising and the banks want to pay you next to nothing for deposits and lend out your money for higher rates so they make the big spread. If the fed was to start selling its gigantic hoard of longterm bonds, we can get the kind of boost in longterm rates that would spur lending yellen has steadfastly not one to do this, tim geithner didnt want to do it. Maybe soontobe chairman powell will embrace the idea. They will give banks an incentive to write more loans including the people who need the money. That said we should always be on the lookout for euphoria because thats dangerous heres what to look for if you see it, this is when the show is going to change its tone first we see a tremendous amount of Insider Selling and secondary stock offerings to get lapped up by the market. Something that happened near the peak in 2000 ill pull the plug trading houses like they did back in 2007 we might be too euphoric ill head out and see investors taking down a gigantic amount of margin debt we might be too euphoric if we hear outrageous price targets and bid them up without earnings and ill tell you to get out. None is happening. Were in the zone, the zone where we feel good ten years after the economy and Banking System were almost destroyed, i think we remain in the optimism phase, not the euphoria phase because tom people remember the devastation and staying in cash being too conservative as far as i can tell just like so many people of my parents generation refuse to keep their money in banks because of the great depression. They dont even care weve got a fabulous worldwide economic expansion going on because theyre too risk averse so am i giving you permission to party down with stocks, no way be careful not to own stocks of companies that do poorly we should always be willing to take something off the table no one got hurt taking a profit, build up cash on the sidelines, something we continue to do for my charitable trust. And we need to be ready for something thats less predictable than the fed under the terrific tenure of janet yellen thank you, ms. Yellen, what can i say. John in new york, john caller jim, how are you . Im good. Caller u. P. S. , 113, the stock skyrocketed to about 124 because of the tax bill and its been in freefall since however the stock has been moving sideways from 117 to 119 analysts are expecting earnings to be 168. The highest its been in a couple of years and earnings are coming out in february and dividends as well. U. P. S. Does benefit from the Corporate Tax right. Caller from 32 to 20 . Your thoughts they cannot screw up another Holiday Season an i dont know whether i can trust them i like fedex more and one that ive been telling club members, youve seen brad jacobs on, xpo. I think xpo is better than u. P. S. All right. Thank you, janet yellen for your transparency and stewardship over the years its been a huge part of it. We are in this age of optimism but home gamers, please remain vigilant cranes and convection ovens dont mix. Seeing how much value was created when they broke up their business and smuckers found a bottom that can stick like Peanut Butter sticks to jelly . Yeah, im talking jiff and why one former ceo wants to give companies a gold star for Good Behavior sitting down with former ceo of sprint dan hessky. Announcer dont miss a second of mad money. Follow of jimkrarnler on twitter. Tweet him madtweets or send him an email at madmoney. Cnbc. Com miss something head to us to find out i think we should do that meeting tomorrow. Well wait. What did you think about her . Its definitely a new idea, but theres no business track record. Well, have you seen her work . No. Is it good . Good . At cognizant, were helping todays leading banks make better lending decisions with new sources of data so, multiply that by her followers, speaking engagements, work experience. Credit history. That more accurately assess a business chances of success. This is a good investment. Shes a good investment. Get ready, because were helping leading companies see it and see it throughwith digital. We thats why at xfinityic. Weve been working hard to simplify your experiences with us. Now with instant text and email updates youll always be up to date. You can easily add premium channels so you dont miss your favorite show. And with just a single word, find all the answers youre looking for. Because getting what you need should be simple, fast, and easy. Download the xfinity my account app or go online today. At a moment when stocks have run dramatically hearing experts talk about how stretched valuations are getting its worth pointing out when they go up theres often a good reason like i told you last night companies arent static. The best run businesses dont stand still. They take their fate into their even hands and create shareholder value. In other words, its not just that investors are willing to pay more for the same merchandise its that many cases that merchandise has gotten better sometimes you dont even need to create new value you just need to unlock hidden value. Now, you know im always talking about breakups and i love them because they can be a terrific way for companies to get the respect that they deserve. When you have two disparate businesses under the same roof wall street isnt great at evaluating it. They tend to get better valuations because its more easy to understand you end up with two leaner, more focused companies that can deliver stronger results over the long haul. So were going to take a indication and go over what it means. Were going to talk about a Company Called manitowok maker of all cranes using construction that spun off its Food Service Equipment business back in march of 2016 and the Food Division goes by well built. This was a textbook example of a company that actually deserved to be broken up. In fact, i recommended they should break themselves up and get rich carefully my last book theres no universe where cranes and Kitchen Equipment belong under the same roof. No one walked under manitowoc and said i need heavy equipment and need a fry master. Cranes like anything else leave it to construction are a boom and bust business. When the economy is strong their crane sales explode hard when it cools, what can i say . Their crane sales tend to fall off a cliff. Food service on the other hand is more consistent its leaving to a different cycle. New restaurants and upgrades equipment at old restaurants think this at the time the breakup was announced manitowac was suffering and the foodservice was accelerating investors wanted to bet on beaten down sickically cal didnt want food service exposure other investors who wanted steady eddie food service play, well, they didnt want the risk that comes with betting on a smokestack stock one of those sell, sell, sell. Didnt add up and manitowoc wasnt doing well announcing Major Management changing after they had an ugly quarter the house of pain. But they had Something Else to announce the long awaited breakup. With the company deciding to spin off its Food Service Division thanks in part to a major push from shareholder activists like carl icahn. I got a nice bounce but didnt last the crane business was too troubled and manitowoc continued to struggle. When the split was announced the Construction Side was experiencing doubledigit sales decreases. Nobody wanted to touch it as long as it was joined at the hip with something some boom and bust since the breakup its been a success. It took them some time to get running. In 2015 the sales shrank by 19 operating declined by more than 60 , ouchl you dont turn around from that overnight. It wasnt that good for manitowoc. But when the Company Reported back in august suddenly everything seemed to kick into high gear. Suddenly they saw its orders increase by 9 year over year and backlog grow by 25 . Thats what we call Inflection Point and went from bad to good thanks to an improving company here and around the world and didnt have enough stocks like this caterpillar and then caterpillar and right, and manitowoc. Once it spun off its Food Division it was good since august the economy has been roaring and thus the stock has been on fire and reported the company delivered a monster top and bottom line beat with its sales increasing by 14 year over year. First positive in ages wall street was looking for a loss whats driving it, some with the rebound in oil and grass, crude back in the mid50s. 30 of where it was. Much more demand and some of it simply because the crane market has turned the corner thanks to the glorious worldwide economic expansion. The world. Much more construction and infrastructure spending. You go if you go to the website they have things everywhere not just in a couple of cities and plain old selfhelp. As they have gotten aggressive about containing costs in order to get the most out of this economic expansion by the way i think its got much more room to run here. It is levered to the Worldwide Global economy which i think is doing well that Food Service Division well, remember, had this started trading as an independent company it was the desirable portion of manitowoc so when the artist known as wellbuilt began trading on its own it climbed from 1350 to 1850 in a matter of months, a horse right out of the gate clearly a voracious appetite and investors didnt want to touch it while it was buried within an ailing cyclical. Since then things are choppy and wall street has gotten more pessimistic about the Restaurant Industry i think maybe too pessimistic but wellbilt has worked its way higher, 22 and change up roughly 64 from where it was at the time of the spinoff and the Company Keeps delivering solid results and spoke to its ceo about a restaurantrelated fear last month he told us welbilt is outgrowing the rest of the industry at a time when we have too many restaurant, many existing players are investing to upgrade their equipment so they can give diners a faster and better eating experience. Right now welbilt has a more reasonable valuation after spending so many years under valued its so cheap i suggested at arecent deal economy conference it could be bought by its competitor or Berkshire Hathaway because they are such a compelling property. So how have you done, this is the real the issue, how have you done if you owned it since the breakup. The tock trading at 4. 04 and one for four reverse split so split adjusted the stock is has gone from 16 and change up to nearly 40 as of today thats a monster 145 gain at the same time welbilt went from 13. 50 to 22 bucks and change, 64 change all told, get this, if you owned this sleepy little crane and food service fry Master Company that is manitowoc and held on to both pieces you got an 83 s p up 34 and on fire heres the bottom line, like ive been saying all along, companies have their own unique characteristics and the decisions made by management actually matter. Not just a big basket of stocks. Even without the breakup manitowoc would do much better here but a great deal on this comes from the fact that with a stroke of a pen, management broke up the old business and gave investors two smaller, much more appealing companies i say, three cheers for mani manitowoc and sometimes its that easy including my take on one that youll know called j. M. Smucker. Youve got their stock its over 10 the past three months, after a steady decline, you have to ask can it make smackers then remember dan hesse, sprints ceo hes working with reward companies with a conscious brace fourself for an entertainment earthquake the real scoop about disney and fox. So stick with cramer your brain is an amazing thing. But as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. Thankfully, the breakthrough in prevagen helps your brain and actually improves memory. The secret is an ingredient originally discovered. In jellyfish. In clinical trials, prevagen has been shown to improve shortterm memory. Prevagen. The name to remember. Whats Critical Thinking like . A basketball costs 14. Whats team spirit worth . cheers whats it worth to talk to your mom . Whats the value of a walk in the woods . The value of capital is to create, not just wealth, but things that matter. Morgan stanley how can you tell when a stock thats been put through the meat grinder has found bottom thats the question i ask about j. M. Smucker the package foodmaker thats been a real roller coaster ride of late. For years the stock of smucker was one of the hottest around. It went from 34 at the generational bottom in 2009 up to 157 in the middle of last year but then it slammed head first into a retaining wall as the companys growth started slowing down and the food space rapidly fell out of favor with the wall street fashion show. Roughly five weeks ago smuckers stock broke down below 100 but reversed again thanks to an earnings beat back up to 118 so should we all jump on the smuckers stock bandwagon not so fast. Heres the problem not smuckers first attempted comeback since its decline began over a year ago. Weve seen this thing try to turn around before and every time the rebound has fizzled and the stock ended up going still lower breaking a lot of hearts so, what, if anything, makes its different than all the others have have they bottomed offer merely looking at a very compelling head fake before we answer that we have to get context. What made it so hot for so many years and why did everything fall apart in the summer of 2016 before the big breakdown their stock were higher as the company transformed itself thanks to a series of very smart ago which signatures smuckers went from jams and jellieies to coffee and pet food where they snapped up a bunch of big brands in