Stocks rose for a fourth straight day, with the S&P and Nasdaq closing at their highest levels of 2023, and Jim Cramer is breaking down what's driving this week's rally. First, Palo Alto fell yesterday after Microsoft announced it would be expanding its cyber security offerings - Cramer talks to Palo Alto CEO Nikesh Arora about what it means for the sector. Then, long-term treasurys have been struggling but Cramer is going Off The Charts to see if the fixed income asset can rally after a sustained downturn. Plus, Cramer outlines more winners from various federal spending bills.

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Today's news can feel like uncharted waters, but more often than you'd think, we're not the first generation to confront what we're dealing with today.

We're just the first generation to make a podcast about it.

Each week, we'll bring you a story from history.

That helps with something in the headlines today.

Rachel Maddow presents Deja News with Isaac Davy Aronson, an MSNBC podcast.

Search for Deja News wherever you're listening and follow.

I'm here to level the playing field for all investors.

There's always a homework at somewhere, and I promise to help you find it.

If you want to make friends, I'm just trying to make you a little money.

My job is not just to entertain, but to educate and explain what the heck is going on.

That means we need to figure out the halves.

Which will most likely make money after putting great numbers and they have not.

Incredibly, I already have the 2 lists Not so hard to tell.

Just look at today's action with the Dallabans, 48 points as it became 0.85% and the tech heavy Nasdaq jumped

To be sure we got a soft producer price index number today which made stocks more viable, but it's the same ones that are buyable over and over and over again.

You're very lucky you viewers because I'm going to give him to you both the haves and have nots first.

Why don't we start with something positive?

Sorry I know it's overdone, but the most halves are the magnificent 7.

This company's crushing it because it's got the best subscription product in the world and it keeps adding great content and therefore many more subs.

We just heard today in David Faber's excellent interview with Disney's Bob Iger that he needs partners for sports.

Can you imagine running live sports through new Vision Pro with Apple making money on the subscription side?

You'll be on the sidelines, not in the peanut gallery.

And trust me, once you've worn the Vision Pro like I have, life will never be the same again.

It is that incredible, hence the sky high price tag.

Don't forget, Iger was in the introduction video for the product.

Doesn't that suggest a potential Disney tie up with Apple?

Second is Alphabet, which is increasingly known as an AI winner, not a loser.

When they can leverage generative AI to make people and companies smarter.

I don't think they're as AI savvy as Microsoft, but investors are flocking to the company because of its long time prowess, as unknown as it seemed to be until fairly recently.

Amazon, hey, just had an amazing Prime Day.

Best numbers ever showing you once again that e-commerce is incredibly strong.

I think Amazon Web Services, which is still in declining growth mode, will turn things around not this quarter, but in the fourth quarter.

So the stock has to be bought now in anticipation of that turn.

That's because we know it is cutting costs aggressively.

Thanks to Reals, their tick tock killer and also Instagram, which advertisers are happy with again because they've come up with workarounds against Apple's privacy restrictions.

Who knows how great threads can be given its mandate to be a kinder, gentler Twitter.

1 where you can post and read comments without feeling like you're swimming in the Gowanus Canal.

It still owns the electric vehicle market after all these years where it's lowering prices and admirably defending its market share.

The internal combustion engine folks are all still way behind and can't scale up to production.

It's also got a hammer lock on all of its businesses.

I just wish they could make it so the team stops popping up every time I turn on my PC.

And that silly news page they put together?

Hey, IT, do you have IT to take that thing?

I can't, IT is not strong enough to stop the junk that Microsoft puts into my PC.

No, NVIDIA is the most spectacularly obvious winner in ages.

Oh, and let's just add some smaller contenders that are magnificent to them, and let's call them magnificent 7 adjacencies.

Oracle, which is at its way into the cloud conversation.

They're winners, along with Adobe, which needs to be considered a winner thanks to its powerful new AI-powered Firefly product.

This is the long on money, short on time thesis.

I keep repounding that others now want to call revenge travel.

I think mine more captures the kind of zeitgeist of the moment.

If you look at Delta Airlines today it crushed the numbers that it was just late in the waste.

Because people want to see the world while they're still alive and healthy enough to do it.

And what's true for Delta of course will be true for every other airline.

with travel needs you as a winner, whether we're talking about booking.com or Airbnb or Carnival Cruise or Marriott.

Hey, so do Chipotle and Darden, because they're publicly traded places where people go in order to have a great experience dining without paying a fortune.

Now I'd like to include American Expresses travel play, but I worry the market is so concerned about potential credit issues that I'm not worried about.

I rather have draft kings or speak of the devil any casino win MGM or Las Vegas Sands.

I've been pushing this Hertz for a while.

But now these 2 stocks are being realized as cheap.

Now, of course, I'd like to include Disney in the halves, but it needs to buy sports programming and the Screen Actors Guild just went on strike as Link to Cable, which is way too hard right now.

Not too long ago we had a semi-duck and glide.

I like Micron, AMD, OnSemi, Texas Instruments, Marvell Tech, Llamasurge, Broadcom, And of course, go ahead, let's hear it.

Now look, you take mortgage rates up to 7%.

It's supposed to slow the group down, right?

Nope, mortgage applications that came out to actually increase this week.

What a nightmare for Federal Reserve, but not for you if you own 12 brothers.

And now we have to add medical devices and friends to the list of has because people going back to the hospital for non urgent surgery now that COVID is over.

I like Edwards Life Sciences, Stryker, intuitive, surgical and the hospitals like HCA.

Well, it could all be winners because that's where you go to get your medical devices implanted.

All right, now let's interest the have-nots.

First, we have the flip side of the medical device bull market, The health insurance bear market because they're paying for these operations.

We'll find out how long this group could stay in bear market mode or at least in the Bow Wow Chateau when United Health gives us this latest outlook for anymore.

This group is so shockingly weak that it's even getting killed by by pickleball injuries.

You know I wanted to play pickables weekend.

Do you have to have whites to play pickleball at the place?

They have some of the most withering earnings power I've ever seen and now they need to be concerned about decades old cables covered in toxic lead?

Anyone with a water we must be feeling like, ooh, I want to sue these guys.

The regionals, not the nationals, as JP Morgan hit a 50-to-week high today.

But the smaller banks, they're being crushed.

I think they'll be ridiculed when they report because they aren't going to be able to handle all the new regulations coming their way, not to mention continued deposit worries, $250, 000 FID, FDIC cap.

The federal government is negotiating prices for Medicare under the IRA.

The FTC is trying to block mergers and next year's election year where big pharma tends to become a public enemy like a pinata these stocks can't get out of their own way.

That means the staples including now let's exclude the fabulous PepsiCo.

Debit have not the staples can't justify the price earnings multiples and their dividends just aren't big enough to protect you.

They can't seem to stabilize no matter what.

Kohl's, Target, Norris, Macy's enter at your own risk.

Brick and mortar's being eviscerated by Amazon.

It's preposterous that things can be this cut and dry.

There are exceptions, as I mentioned with PepsiCo.

Walmart, but the bottom line, this market is really about as clear as I've ever seen it.

The funniest thing or or some would say the oddest thing.

Everything you ever hear about the economy, whether it be the Fed or inflation, the yield curve has almost nothing to do with what's actually making you money.

Because it's arbitrary, it's capricious, and at last, it's bangable.

Hi, Jim, Booyah, thank you so much for taking my call.

thank you for all your advice and saving us from ourselves for not losing more money than we have to.

Thank you for understanding and thank you for being our first caller tonight.

I have a stock in shares of Home Depot and Lowe's and I was wondering, I would like to add and buy some more of F&D, floor and décor.

I gotta tell you, floor and décor is a pretty good outfit.

You know, at first, initially, I was a little suspect.

I think that Lowe's, Marvin Ellison's doing a great job, but I, there's nothing, what can I say?

Floor and décor are the 2 areas, décor and floor, that are doing really well at the opening point lows.

Everything you ever hear about the economy, whether it be the Fed or inflation, the yield curve means nothing.

At least when you're trying to make money.

That's because what really works is arbitrary, capricious, and I just gave you the list.

On Mad Money Tonight, we're wrapping up our series on legislation beneficiaries by identifying some miscellaneous themes that are poised to benefit from a new flow of government spending.

Then bonds, treasury bonds, after a tough stretch for long-term treasuries, could things be looking up in the long run?

Yesterday we learned about a major cybersecurity breach within the federal government with hackers getting access to a host of email accounts, including that of Commerce Secretary and Kramer Faye General Mondo.

I'm learning more about how something like this happened and how we can prevent it with none other than Kramer Fave Palo Alto Networks.

There's investing news that impacts your life.

And there's business news that impacts your life.

From Wall Street to K Street and Main Street, the markets may close, your money never stops.

Last Call is really about spotting tomorrow's opportunities tonight.

Follow and listen to CNBC's Last Call on your favorite podcast platform today.

All week, I've been highlighting the biggest winners from the Biden administration's huge spending bills because that money's finally starting to really kick in.

Now we've been over the infrastructure bill, the CHIPS Act and a big chunk of the so-called Inflation Reduction Act, but there's still a lot left over.

Let's start with another set of IRA beneficiaries that I didn't get to last night.

We now have huge tax incentives for people who install high efficiency heating, ventilation, and air conditioning systems, yes, HVAC.

And this is on top of all the money in the various COVID relief packages for various ventilation upgrades, especially in schools, by the way, which is a fantastic market.

The 2 big winners here are Carrier Global and Train Technologies, both of which hit new 52-week highs this week after a miraculous rally since the end of May.

Carrier Global and Trader Wiley perceived as being cyclical stocks that are hostage to the broader economy, especially the ailing commercial real estate space.

But now it seems the economy's in better shape than Wall Street assumed.

And by the way, these have been rebounding, of course, because of this tremendous financial tailwind.

Carrier also announced a big European acquisition, coupled with restructuring in April that initially the market disliked.

But now people seem to have come around to this 1, as they should, because the acquisition gives carrier an amazing global heat pump franchise, the cleanest form of heating.

By the way, the stocks up 28% since we spoke to CEO Dave Gitlin in late May.

Hey listen, both carrier and trainer well run and now pretty substantial since the end of May.

But with all the tax credits for the merchandise in the Inflation Reduction Act, well, let's just say the the funds for ventilation improvements in schools.

Thanks to the COVID era stimulus bills, these guys have powerful tailwinds that could be with us for years and years.

This has been a favorite of mine ever since Gitlin got in.

Okay, White House, rural broadband's another major federal spending initiative.

There's a priority that has got multiple bills, including the infrastructure package.

Now, just over 2 weeks ago, the White House announced specific amounts of funding that each state, territory, and the District of Columbia will get through the Infrastructure Bill's Broadband Equity Access and Deployment Program.

No one's paying any attention to this stuff.

We're talking about more than $42 billion worth of grants that span the entire country and no 1 talks about it.

Well, last November I introduced you to a company called Dicom Industries, which was originally a homework item.

This is an engineering construction, we call them E&C, engineering construction firm that mainly serves the telecommunications industry.

Meaning when they lay down rural broadband lines, these guys stand to get some of that business.

The stock's now up 28% since I recommended last fall.

But remember this rural broadband spending has only just been allocated to the states.

It definitely hasn't even put it in DICOM's numbers yet.

But while I'm happy to crow about Dicom, this is a show about accountability.

So I got issued a call for another stock I recommended at the same time.

It was called Clearfield, which makes telco equipment like fiber optic cables.

The stock had already made a big move back then in anticipation of all the rural broadband spending coming our way.

I thought it could keep running, but instead it fizzled back in May.

Clearfield had to slash its full year earnings forecast dramatically because this customers over order during the pandemic and now needed to digest that old inventory.

That said, now the Clearfield stock has been cut in half.

I'm not sure I want to back away from it.

The problem with Clearfield is that we got the timing wrong.

We didn't know it still had COVID inventory hangover to work through, so many companies did.

And we were nearly a year too early to benefit from the infrastructure spending that we knew was on the way.

Now though, that money is being closer to being spent.

I gotta take a look at this thing and say, when we looked it over, Well, we liked it twice.

a lot of confidence by a telco equipment maker right now because companies like AT&T and Verizon really struggling, meaning their desperate looking to cut costs too.

I don't know if all the Fed spending on rural broadband is enough to offset that.

We just still 1 more caveat because this 1 I did get burned on.

Finally, I need to reiterate my support for the military industrial complex because the defense contractors are set to benefit for years to come.

Now we've sent so many stockpiles over that The Pentagon is going to have to replenish this stuff for many years, not weeks, not months, but years.

Now, 3 weeks ago, I pounded the table on RTX again, company formerly known as Raytheon, because they've got both a terrific aerospace business and an incredible high tech defense business.

I don't want to sound like a broken record here, but you know what RTX?

Now unlike everything else I've mentioned in this series, the defense contractors don't see much benefit from the big spending programs that passed in 2021 or 2022.

Instead I like to group because there's something that didn't happen in a much more recent piece of legislation, the Fiscal Responsibility Act of 2023, aka the debt ceiling deal.

Specifically, there weren't any big cuts to defense spending, like we saw in the last big debt ceiling showdown in 2011.

The defense cohort roared last year, but these stocks had been lagging behind the market in 2023 precisely because of the debt ceiling related worries.

I pointed out this was ridiculous because the defense stocks did great even after the budget cuts that followed the 2011 debt ceiling deal.

Plus, we weren't bankrolling a lamb who were back in Eastern Europe back then.

It turns out that we didn't even have to worry about defense spending cuts as part of the debt ceiling deal because the ultimate agreement allowed for $886 billion in defense spending next year.

That's the exact amount that President Biden had already requested in his budget, and up more than 3% from the previous year's defense budget.

That's why I think the defense stocks make sense as major beneficiaries of government spending programs.

It's just a different set of programs that mostly relate to refilling our stockpiles after sending so much of the stuff to Ukraine.

Best of all, you can buy most of these stocks into weakness.

This is RTX Lockheed Martin, which he asked about just last night.

And Northrop Grumman still have stocks that are negative in negative territory for 2023.

Bottom line at a moment like this, You need stocks that can keep trading higher regardless of the ups and downs of the broader economy.

And few things make that easier than huge federal spending programs that pour vast quantities of money into specific businesses.

Now if the money is getting into the hands of the states at last, it'll soon reach these businesses themselves, potentially giving their stocks multiple years of gains and gains that can still be had by you, especially if this now red hot stock market ever cools and you can get in at better prices.

Coming up, yo ho ho all of you searching the horizons for yield.

Is a plunder to be made on Treasure Island?

I got started in this business in the early 80s, literally 2 blocks from here.

Federal Reserve was in the process of ruthlessly raising interest rates to stamp out what was then horrific inflation, like a much more extreme version of the last year and a half.

I bring this up because back then you had an incredible opportunity to buy longer-term treasuries with high yields right before a fabulous multi-decade rally in the bond market.

Once the Fed beat inflation, bond prices soared as bond yields plummeted.

It was a bond holder's paradise if you got in early.

I sold a ton of 30-year paper to my Goldman Sachs clients back then, paper that yielded 14%.

Some people say it was the best call of my life.

And we could be headed for something similar in the not-too-distant future.

That's why tonight we're going off the charts with Carly Garner.

She's a brilliant technician, helped us tremendously.

She's also the co-founder of DeCarli Trading, the author of Higher Probability Commodity Trading, which is a book I like very much.

And she's feeling very confident about something that people otherwise aren't, longer term treasuries.

Of course, thanks to the most aggressive rate hike campaign in the Federal Reserve's history, investors have circled back to high yield, low risk assets, especially short term treasuries, where you get a better payout with less risk.

Right now, a 1 year treasury yields more than 5%.

Last week, we had a nasty sell off in longer term treasuries, which is why both the 10 year and the 30 year now pay you close to 4%.

Plus the first half of the year was very good for the stock market.

Still 1 more reason why long dated treasuries have been held back because stocks are the real competition here.

But Garner thinks longer term treasuries could be uniquely positioned to give you both high yields and amazingly higher prices going forward, making this 1 of the best times in history of the U.S.

Bondholder, just like the early 80s, at least on a percentage basis.

Now, going this year, all sorts of analysts and money managers were caught flatfooted.

Everybody thought we were headed right for a recession.

See all Mad Money w/ Jim Cramer transcripts on Applepodcasts

Palo Alto Networks CEO, Off The Charts: Treasurys & Legislation Winners 7/13/23