Investors did before the events started occurring out west but ultimately the dow tumbling 159 points, s p plunging. Sadly, i believe, some of the Late Afternoon declined stemmed from worries about the tragic shooting in Southern California and whether it could be part of a larger terrorist action. Most of the selling started and was about Janet Yellens statements. We can flit in and out of stocks based on every Federal Reserve utterance as we seem to do. How about this . Maybe we can just keep calm and carry on . Except rate hikes are coming and go to work regardless of what is set by the fed to build a portfolio that fits our world view. Ouworld view even if the fed tightens. I know if youre oblivious to what yellen says or you try to be or what any Federal Reserve official of any importance says you may not know why the stock market spikes up or down on a given day or two. I know i cant afford to skip a big speech from janet yellen, i have to talk about it on the show. Every word. That wont make you money and you home gamers should dont that, either. Heres why. For four years now ive been hearing the fed has pushed to prop up the economy and thats what it is. It needs to end. I hear it from the ideologues so to speak who dont like the fed meddling in business and want the economy to sink or swim on its own regardless of whether it might drown and take companies and their stocks with it not to mention workers tossed out on the street. I hear that same thing from those who fear inflation even as theres no inflation to speak of. I hear people who say business has gotten better so its time for the fed to move. Finally i hear it from people who cant stand the suspense and want to get the darn thing over with. Heres the thing these people have in common. First, theyve kept you out of one of the greatest markets in history, even as its been muted lately. Stocks of companies you knew were doing well but were afraid would happen when the fed tightened. Google, alphabet, facebook, amazon and apple. I pick on those for the moment because if you ask my kids to name some stocks of companies at they like and swewe by, thats the ones you come up. Remember, the young dont inherit the earth, they inherit your stocks. In short the fed must raise, feds should raise, fed is behind the curve. Fed cant act now, window closed, clack. Its truly kept people in the shadowowf certificates of deposits that yield less than 1 or if youre part of the crowd that is so judgmental of the fed you can argue the fed is allow reckless people to borrow a great deal of money and make terrible investments that can come back to haunt us but so far the terrible investments have produced terrific returns. Im not here to judge what you might have done with your money. Im here to tell you how to use the endless chatter about how to use the fed to your advantage. Lets take today. We know the fed wants to raise we heard that when yellen spoke. We heard the fed doesnt want to wreck the economy and throw people out of work but it doesnt want to stoke an overheated economy. I could have said that in the last four years. Theres nothing new about what i just said. Noing. Its the same thing weve heard since we came out of the great recession. Yet every time we hear it the market sells off. The fact that this time the fed may raise rates by a quarter of a point is accepted but stocks t slammed any way. Is that right . The question can be best answered by ththfollowing analogy. Right now, the mall, lets go to the mall. Its stuffed with Department Stores that have too many winter coats. How can that not be the case . Its over 50 degrees and theres only 22 days left to christmas. E key is traffic if f amers Department Store were to advertise winter coat sale 50 off that wouldnt get you into the store, you dont need a winter coat. Who knows if we have a winner . How about if cramers Department Store took a different approach. Something like this, this weekend take 25 off all store merchandise. That might help get people into the e ore and maybe theyllbuy those coats. If not, youll have to sell them a company like a tjx or a ross stores at a loss. They come in with cash and buy them and sell them to you marked down. Much better to have a sell than dump the coats. Lets apply to the same logic to the stock market. What are the winter coats you dont need . Maybe stocks of companies that would be most hurt by a tiny rate hike and a promise of more down the road. Stocks of companies that sell should soar or it might be rates to entice you to buy their the car companies. Notice those stocks havent done well. This is a storewide sale. All of the merchandise gets marked down. You can take your shopping list, by stocks of companies that wont be impacted by a rate hike but are being put on sale anyway as part of the storewide sale. Maybe this is when you buy a biotech or food company or higher yielding drugtock. They shouldnt be on sale but they are. Perhaps you pick up General Electric. Were going to hear from jeff immelt, the ceo of ge. Maybe youll hear about how his company isnt hostage to the fed but today his stock was put on sale anyway, although not that much because theres strength there. Thats when you start buying. In case janet yellen jars more people when she speaks tomorrow we get a strong employment number on friday which will freak some people out because it would mean a december rate hike is inevitable. Certainly you buy in stages on the way down. Never all at once. You know thats what i teach. So heres the bottom line. You can be paralyzed by the stock market equivalent of the weather, Federal Reserve causing the store wide sale or think stocks of Higher Quality companies at a better price you would be able to able to get. Tell me what you do as a consumer, a shopper, and ill tell you what you do as a stock buyer which is the same thing. On mad money tonight, my exclusive with jeff immelt, ceo of ge. Then im looking at two stocks the maker of kevin kline, tommy it seems that every year, we have to watch out for different types of germs. Which is why its important t r your wipes to kill a Broad Spectrum of germs. Lysol wipes kill 99. 9 f germs, including 8 different types of cold and flu viruses. To help protect your family. Lysol that. Americans. We try to live healthy. But many of us dont know there are nutrients that can help support our metabolism. Take new one a day healthy metabolism support multivitamin with chromium to help use carbs from food and bvitamins to helpconvert food to fuel. Looking for 24 7 digestive support . Try align for a nonstop, sweettreatgoodness holdontoyourtiara, kindofdada live 24 7 with 24 7 digestive support. Try align, the undisputed 1 ge recommended probiotic. I absolutely love my new york apartment, but the rent is outrageous. Good thing geico offers affordable renters insurance. With great coverage it protects my personal belongings should theheget damaged, stolen or destroyed. [doorbell] uh, excuse me. Delivery. Hey. Lo mein, szechwan chicken, chopsticks, soy sauce and you got some fortune cookies. Have a good one. Ah, these small new york apartments. Protect your belongings. Let geico help you wiwi renters insurance. To feel this speal. You need to eat this special. I love it. With 150 nourishing calories in a bowl of special k. Long time cramer fave ge is finally getting credit for its Financial Company that happened to make turbine, locomotives back into a fastgrowing industrial powerhouse with very little banking exposure management has sold off 126 billion worth of assets. In short, ge is transforming itself into a leaner more focused and easier to analyze company that may be able to buy back an immense amount of stock and offer an even larger dividend than the one that gives you a battle for more than a 3 yield. Tonight we are lucky to have the architect of this with us, jeff immelt, the chairman and ceo of ge and a man who used to be, im proud to say, my boss back in the day when Nbc Universal was part of the family. Welcome to mad money. Hey, jim, how are you doing . Great to be with you. Same thing, jeff, really is. All right, jeff, we have to start with the fact that your stock has been the best performing large capitalization Industrial Company in this market rallying more than 18 this year, a leader in the Dow Jones Industrial average. What do you attribute to portfolio . Perhaps a change in culture to a more Industrial Internet Company . A bit of all three . I think its a bit of all three. Weve had a lot of things come together this year. The dispositions of ge capital have happened fast and in a valuable way. I think the synchrony spin h h been a aerrific value accumulated for investors. Our industrial businesses are going organically, faster than their peers with higher margin growth and i think people look at the company now, they can understand it better and i would tell you, jim, ive been doing this a long time. When i look at the next three years, the ge teams knows what we have totoo, we have the tools to do it with and from a Capital AllocationEarnings Growth organic growth standpoint were a good bet for investors right now. I think people have to understand because i love you brought this up. Your organic growth, this is a the compmpies in your sector. Is that longterm decisions that are bearing fruit or just the fact that the portfolio fits the market and the times we are in . Id make two comment, jim. First of all you have to invest to grow and i think the longterm bets weve made on technology, digitization, globalization those are paying off right now and in a slow growth and volatile world having being in a multibusiness structure allows us to be able to play through this in ways that more singlepurpose companies can. So while the only gas business may be tougher, the Aviation Business is booming and you add all those up and you get an industrial organic growth in the midsingle digits. That looks damn good in the environment were in right now. So thats what it takes. I know a trusted advisor of 2. 5 billion. Has penned a white paper and its a lot about what were talking about except its entitled transformation under way but nobody cares. Thinks your stock could go from 40 to 45 at the end of 2017 but the way to g g there is to retutu 40 of the market capitalization which includes borrowing a lot of money. Good idea . Heres what i would say. We have a lot of great investors. I think having a long only investor like nelson in this stock is a good thing for our investors right now and i think the combination of organic growth, margin expansion, Capital Allocation thats more heavily weighted towards buyback through ge capital and the potential to take on more leverage, those things are attractive. It should give us top of class industrial eps growth and distinguish ourselves from a the same time. We have a lot of good investors that see this as a good way to achieve Value Creation for our longterm holders and i look, i think the Management Team is being a good way for the company to go. Jim, look, all that being said, organically, were still investing in r d, capital expansion, all those other things but i think with ge capital we have the opportunity to buy back a lot of stock, keep the dividend at very attractive versus our peers and grow the company organically higher than our peer set. So organic growth, margin expansion, return on capital investors, thats a good combo in the world were in today. And its also once you are the final disposal to wells fargo, this systematically Important Financial Institution goes away, what does that mean for a new General Electric . An Industrial Company. Thats what were seup to be. More than 90 of our earnings will be industrial. We no longer fit the screen of what had been a systematically Important Financial Institution and it allows us just to be what we arere a high tech best in class Industrial Company where we use financing as ways to generate good returns and grow our industrial business and from an investor standpoint, from a Capital Allocation standpoint it allows investors to see us for what we are. We should be a high margin Industrial Company and i think its all kind of falling into place. Its one thing to have a plan. I dont think investors necessarily want to invest in a plan but when you see it being executed in a systematic way, thats why i think you see more smart investors that want to get into stock. In paris over a Climate Change actually my kids were asking me, dad, what company is most in position to actually benefit . This is all they care about, jeff. You have kids, we know thats the future. Anange is the company that is involved with trying to stop ban Climate Change. Weve been working on this for a decade, a decade. Long before it was cool. Were investing in Clean Energy Revenue growth in technologies. We have more than 25 billion of annunu revenue that is really in clean tech, if you will, highefficiency engines, wind turbines, Energy Efficiency. So we are as well placed from a standpoint as anybody in the world to be able to participate in the this clean energy future. The other thing i would say is look, we are we h he a an will have to upgrade these plans to make them cleaner and more robust for the long term so look theres a lot of ways to play this, from Energy Efficiency to upgrades to new technology. We can play all three. We can play every dimension of this game and we plan to do so. Now you did make large bets in fossil fuels. Oil has come down big. Is it time to double down. Is it time to think oil is is a good investment or do you say its part of the pastiche, it cant hurt the company . The reason why we invest in oil and gas wasnt that we thought the price would be 140 or there 100 or whatever it was. We could see the technical intensity of the industry growing. We thought the industry was largely undercompeted from a technology standpoint and we still believe that today. So we think the long term positiwn we have in the oil and gas industry is going to bear fruit over the long term. Jim, if i would have done this show ten years ago right after about the Aviation Business. For the five years for from 2001 to 2006 the Aviation Business stunk in ge. Now its amazing, right . So we have the ability to play through these cycles opportunistically in ways that oil and Gas Companies cant. So for the long term i still believe in this business but we really build our business around technical intensity, not trying to predict exactly what the price of oil was going to be and i see this even more relevant with Lower Oil Prices than i did when prices were is 100 plus. At 100, everybody looks smart. Where we are right now you have to be able to compete to prosper and thats where we think well be. Ive been thinking, also, the acquisition. When i go to alstoms site and what ge is saying about it, it looks if you wanted to get out of coal you would call alstom. If you wanted to build alstom. What does this mean for earnings power, not just feelgood . I think its hand in glove in terms of what we know how to do. Weve got a progression of earnings over the next lets say two, three, four five years that get it up. Were talking about five or six since next year, more the year after, more the year after. So w wve got it built intotohe plan. What iould say, jim, is look, this is about execution and if the ge team executes the way i know we can well make lot of money for investors as we look at alstom Going Forward because its complementary technology, its everything we know how to do and w wfeel great about our ability to execute. Thisiss 100 in our control about execution. Those are the deals. Look, this was four times after synergy. We ought to be able to make a good return for investors on a day like this. Something. Theres a great ad you guys are running. A guy comes, a lot of smart people, ey say where do you work . He says i work in ge. This is about obviously the Digital Economy and i want everyone whos watching to understand where youve taken the company and how its an internet industrial and what that means for earnings, for dividends and the future. Jim, this is maybe one of the momo important thing thahayour ininstors can think abouou theres a lot of buzz words out there, the internet of things, industrial internet. Heres what i would tell people a locomotive today is a rolling data center. An aircraft engine is a flying data center. This is producing terabytes of data everyryy. This data can be used to give back to customers to drive fuel efficiency, better performance, better environmental performance. We can take the same technology and do it in our plants. So every investor of an Industrial Company ought to strategy is. For us it will mean more productivity and faster growth. Weve been doing this for five years so i think we have a leadership position but jim, i dont have to tell you, if you go back 15 years, trillions of dollars of wealth have been created in industrial internet stocks over the last 15 years. If you look out ten or 15 years, there will be trillions of dollars of wealth created in the industrial internet and were just in the first innini and i want ge to get itstsair share of that. So maybe we think of ourselves or people think of ourselves as an old industry company. Those days are over. We think this i