Pulled under by the shakespearean tragedy that is apple. How can we keep going higher with the disarray in washington . The higher payroll taxes, and the general sense that the economys not getting any better. Is it . The answers simple. Why you may not think the overall economy is Getting Better, youre missing the big picture, partner. If you were to ask me to game the market using just one figure, one figure only, it wouldnt be what apple earns, the gross domestic product, the growth rate of earnings or the dividend yield of the s p, it would be the weekly jobless claims. The weekly jobless claims is an indicator of future employment in this country. Theres absolutely no coincidence that we had fiveyear highs today in the stock market. At the same time that unemployment claims hit fiveyear lows. It isnt fanciful that the markets roaring because jobs are being created at an accelerating pace. Its the most important determinant of the stock market. After all, the market got crushed when unemployment went above 5. 5 and soared right into the great recession. I think these positive jobless numbers are occurring because of the certainty that comes from putting a president ial election and a tax fight behind us. Plus, the warring Political Parties seem to have smoked a peace pipe. It does seem like a truce at hand deferring a ridiculous and harmful government shutdown. Throwing a huge turn in china that converts believers every day along with stabilization of europe and you know why our Multinational Companies have at last powered higher. All that good news in the jobs it creates are causing a radical revision in what were willing to pay for future earnings. Thats right, the price to earnings multiple, the ratio of how much well pay for the profits companies are going to have down the road is headed north and therefore so are the stock prices. Were willing to pay up because of the prospect that things are, indeed better. Let me show you what i mean. Lets take the transports. Theyve been scorching, scorching despite the index being home to money losing airlines, beaten down trucking companies, worldwide freight plays, and the railroads which were just annihilated by an historic decline in the most important cargo, coal. Whats happening now if the economys Getting Better for the airlines . The seats are being filled, raising prices. For trucks, theres more commerce domestically, more to ship. For freight, the stabilization in europe and the nation is gigantic, every bit as important for United Parcel as the huge orders from amazon. And, yes, were paying more for the rails because we have to believe that coal has bottomed, down 19 , because electric will rise. Europe and china will use our coal. Meanwhile auto for woods and homes as long as grains, oil all need to be moved to where theyre needed. The bottom has been reached, the Gross Margins can climb because price increases can be put through, right through along with the larger volumes and the stocks go higher. Were seeing the same thing with the industrials. As we know from watching boeing go higher, the best example because the rally is happening despite the dreamliners many woes. If boeing can go higher, what industrials cant climb . How does caterpillar go higher despite the huge chinese scandal . Simple, because were starting to build things in this country, things that need tractors and the chinese are reaccelerating. They need tractors and engines too. We talked about the growth in heating and airconditioning. The orders for carrier, the Carrier Division of united technologies, or the elevator orders for otis. So we pay more for the stocks. In the meantime, we know taxes on our dividends arent going up. They stayed almost the same. Thats a remarkable surprise that nobody talks about. But the need to find higher after tax yields is behind the huge move in the big dividend paying drug stocks. Its why we pay more for bristolmyers as we did today or Johnson Johnson which kind of hangs in there despite the earnings miss and the horrendous implication of their faulty hip product. Its why were paying more for the oils, all the oils because more oil will be used when things get better sending the hesses and conocos higher with them. Thats how schlumberger can be ten points above where it was when it preannounced a shortfall. And, of course, any uptick in employment has huge implications for autos and for homes where for a couple of years we were building homes at a rate that came in under what we were building when we had half as many people in this country. More homes means more retailers doing business to fix those homes, and it means more businesses for the banks, the processed home loans and that group gets revalued upward. We use more copper, more wood, more fiber, aluminum, glass, paint, tools, when we build more homes and cars and planes, especially when the demand seems to be sustainable and rising. So we keep paying more for the earnings of all the Companies Involved in that complex. Yep, we pay more for all of those stocks when the Virtuous Cycle gets going as it is right now. And remember, employment just turned. Thats what we key off of to decide what to pay for future growth. Companies will have more demand, higher prices, better Gross Margins, better than expected earnings and those better than expected earnings are the life blood of this entire magnificent rally. The only area where it gets really confusing is tech. And thats a huge part of the s p, the biggest, talk about a battleground. What did we pay for apples earnings now that theyre decelerating . Do we take money out and buy other Technology Stocks like intel or microsoft which reported mixed but in line quarter, 76 cents a share, onecent beat, drop a tad, 1. 5 in after hours trading, or do we go by avnet, like whole foods, which reported terrific upside surprise today. Or do we pile into what we know is growing faster . That stocks that arent tethered to personal computers alone, facebook, amazon, google, and netflix, which rallied more than 40 today. Are those four stocks the newest four horsemen of tech . Replacing intel, cisco, microsoft, oracle. Are those now our father stocks like merck and pfizer and lilly were before them or general motors, bethlehem steel and woolworth were before those . I would argue kind of, yeah. Apple being revalued identically to intel, microsoft and oracle on earnings basis, lower than those. Those were once highgrowth stocks where the growth has stalled out. Their shares trade at a discount. Apple in a sad way is a source of funds. Its supplying the fuel for the revaluation higher as it sheds billions of dollars in market cap, money that goes into the other segments of tech and the rest of the market in general. Fine young stock cannibals. All these revaluations are playing out right now and thats why were seeing such a robust market. Money coming in from the sidelines, recognizing with washington off the front pages with loan growth picking up and Interest Rates on bonds not competitive, its time to pay more for stocks. Heres the bottom line, this is the kind of super bullish moment we only see once or twice a decade when we decide the old tv show has it backward, the prices arent right, theyre wrong and they must head higher, almost in lock step to where they really belong. Scott in california, scott . Hey, scott. Caller how you doing, jim . This is scott from studio city in sunny, california. Loving that. Caller booyah for ya. Its good to have you onboard, whats shaking . Caller netflix, yesterday at the close, basically ive been trading the market methodically and its given me some profits, 95 in cash, looking for something to buy, got a little bored, saw netflix, i know i know i shouldnt chase it being up 5 on the day, but i decided to throw some money at it and a couple minutes later, i noticed it popped 35 , and i gave you a call because i was wondering what i should do. Look, i do these videos every day for realmoney. Com, and i said if you owned if you owned netflix, take a little off the table today. Because i dont like parabolic moves, a Great Company but thats up too much. Cut it in half tomorrow. Cut it in half. The move is too big. Lets go to tyler in iowa. Tyler . Caller booyah, jim. Lagrand, iowa. My stock is invn. The consensus after the bell yesterday and had a solid run today. Do you think itll get back to the alltime high of 20, or where do you see it going from here . That is a good stock and i think you should hold on to it. Its funny, we looked at this once before. We should look at it again. Wow, that has moved a great deal. We have to do more work on that. We have to do more work on that. Thats a monster move. This is a rare moment in investing. Things are improving. Dont drive yourself crazy by missing the big picture. As employment gets better, stocks go higher. Mad money will be right back. Coming up steely resolve . Industrial giant timkin delivered a quarter that pleased the street this morning. Is it the fire you need to heat things up . Tonight cramer checks if the stock is on the right track in his exclusive with the ceo. And later, assault on apple. Relentless selling drove shares of the former street sweetheart apple down 10 in reaction to their latest Earnings Report. Tonight, cramers slicing it open and asking the question on everyones mind, is it done going down . Plus tech check, apples sour Earnings Report kept the nasdaq back while the rest of the market roared. But shares of i. T. Supplier avnet bucked the trend, surging after reporting. Dont miss cramers exclusive with the ceo as he browses the supermarket of tech for whats working. All coming up on mad money. Dont miss a second of mad money. Follow jimcramer on twitter. Have a question . Tweet cramer madtweets. Send jim an email to madmoney cnbc. Com or give us a call at 1800743cnbc. Miss something . Head to madmoney. Cnbc. Com. I played a round of golf. Id in the last five hours . Then i read a book while teaching myself how to play guitar; ran ten miles while knitting myself a sweater; jumped out of a plane. Finally, i became a ping pong master while recording my debut album. How you ask . With 5hour energy. I get hours of energy now no crash later. Wait to see the next five hours. Those spots are actually leftover food and detergent residue that can redeposit on your dishware during the rinse cycle. Gross. Jetdry rinse agent helps wash them away so the only thing left behind is the shine. Jetdry rinses away residues for a sparkling shine. But they havent experienced extra strength bayer advanced aspirin. In fact, in a recent survey, 95 of people who tried it agreed that it relieved their headache fast. Visit fastreliefchallenge. Com today for a special trial offer. Visit fastreliefchallenge. Com excuse me, sir im gonna have to ask you to power down your little word game. I think your friends will understand. Oh no, its actually my geico app. See . I just uh paid my bill. Did you really . From the plane . Yeah, i can manage my policy, get roadside assistance, pretty much access geico 24 7. Sounds a little too good to be true sir. Ill believe that when pigs fly. Ok, did she seriously just say that . Geico. Just click away with our free mobile app. Never let it be said that americas no longer a great manufacturing nation. Economies all over the world are doing a whole lot better than they thought theyd be even a month ago. Thats why the industrials have been roaring. And here in the united states, we have the best industrial manufacturers on earth bar none. Companies like timken, largest manufacturer of roller bearings and a major maker of highengineered bearings and alloy steels. I like the stock so much, recently bought it for my Charitable Trust as we visited them in ohio. You can follow along with that at actionsalertplus. Com. Timken supplies a host of industries that are on fire right now. All of these are bouncing. And also the rebound courtesy of the turn in china. Oil and gas business too. Aeros, autos, china, oil and gas renaissance. These are four of my top themes for 2013, and timkens hitting in each of them. Back in 2011, 30 of their products, their steel business sold, didnt even exist. Thats right, the product lines didnt even exist five years before. Thats what i mean about this company being an innovator. Now, just this morning, timken reported a fabulous quarter, a 16cent earnings beat off a 6 cent basis and though its revenues fell yearoveryear, they came in higher than expected. Their response to the stock rally convincingly. We last spoke to timken from the floor of their faircrest steel plant when we went to canton, ohio, on october 18th. At the time trading at 39 and change, since then, its risen to 53. Lets check in with jim griffith, president and ceo of timken, learn more about what went on and where the company is headed. Mr. Griffith, welcome back to mad money. Its great to be with you, jim. Do you think some of what happened in your stock since we saw each other last, that people believe 2013 will be a better year, or the fact that the year did finish pretty strong even if some of the parts, oil and gas, some trucks, werent as robust as wed like . Well, i think the markets beginning to recognize that the Timken Company today is a very different company. 2012 was our second best year structurally in terms of earnings, and as you said, we went through a Fourth Quarter where our customers were adjusting inventory, our plant utilization went down to 50 . And yet we delivered a good quarter. And i think that recognition is getting through to the market. Well, i think this is really important because ive studied the Steel Industry for a long time, visited bethlehem steel a bunch of times. Once they went below 90 , okay, 90 of their factories being used, the stocks plummeted. How is a Steel Company able to make this much money at 50 . Well, i think the answer is you said in your introduction, we really arent a Steel Company. Were a Knowledge Company that goes to the market. We create unique value whether its with bearing products or Steel Products for our customers and then we translate that on a platform of excellent execution. And that combination gives us better earning power. Now, i did find versus when we talked to each other last, i read through the lines of this excellent Conference Call and i see asia turn. That to me is just unassailable at this point. We are seeing a change in asia, a significant change. Were beginning to see the order books fill. We actually had a good booking month in december, a good booking month in january. So we are beginning to see it particularly in china where the actions of the new government are starting to come through and translate into orders for us. Well, i think thats very, very big. Because i know when we saw each other, you described how many people you have working in china, right . Yeah, we have about 4,000 people in china, which is our investment in the 21st century of demand, getting into the Fastest Growing markets of the world where they are Building Infrastructure and that infrastructures being built around timken products. Now, also, when we were there, i felt remiss. You do well in this country in part because you do have a great source of energy, right . American energy is playing right into timkens hands. Well, in the united states, we have a good energy supply, but more than that, the change in the Energy Markets is creating a great opportunity for us. The growth of a domestic natural gas market, a drilling market, domestic fracking market is creating a great opportunity for timken products, and thats part of whats driving our profitability. Now, after i saw you and spent some time in your plant and with your terrific people, i came to understand that timken, sorry for using this word, but its a wholistic experience. Great Technology Arm doing a lot of terrific products and theres some guy who buys a lot of stock and says we ought to break up timken. Tell me if you think im wrong, but i think that the parts are actually augmented by the whole, not worth more than the whole. Yeah, theres no question about that. We leverage the synergies between all parts of our business to create value. In fact, just this quarter, we started delivering on a Major Contract with one of the transplants where were selling steel, but were selling it in the form of a preformed product for one of their transmission plants because were taking the capabilities from our bearing business and applying them to the technologies in our steel business. And also, just the way you brought the bearing business pointblank. One thing that never wavered here, aerospace is really good for you, isnt it . Our Aerospace Business has turned nicely. In our Aerospace Business its only about 50 bearings. Weve gone well beyond bearings into services and, in fact, into making complete transmissions for some of the military helicopters. And that market is actually a positive market for us despite what you hear from washington. One last thing, im trying to understand where we might get a trough in trucking, because trucks are very important for timken. We are beginning to see truck orders troughing in asia. Will you see a trough in trucking in 2013 . Again, as you look at the truck market specifically, youve got to look at it on a global basis, and the european truck market is already at relatively low levels, the u. S. Truck market is at relatively low levels. Asia, its beginning to strengthen in some places. Theres a chinese truck market, a domestic truck market that is transforming to world standards and we have a large position in india. So overall, thats a reasonable market for us. Its down in the Fourth Quarter of 2012. It will start 2013. Relatively slow, but in the longterm, we think thats a very positive market for us. I want to congratulate you, jim, for both the Great Technology that you employ and the fact that the old d