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Wednesday May 17th 2006

'Cell Side'

"What you want to know is why things are bad and what to do about it.

Stocks are like gravity; if they've gone up a lot, then they are going to come down a lot.  If they're up big for the year, then they really got hammered today.

On Mad Money, we don't care about today; we live in the future on this show! 

And you want me to look into my crystal ball and tell you my take on the future.  No problem - that's my job.

What we're getting now is a total washout.

We're not there yet.  So close, so close, but we're not there yet.  We need all of the negativity swept out in a massive frenzied purge that knocks everything down, and puts everyone in the house of pain.

Only then, can you get doing the 'mon-back; only then, can you get aggressive!

You need to wait for the tidal waves to come through, and really smack this market around; a crescendo selloff to create some buying opportunities.

Some of this we saw today.  I've got to tell you, I think thing financials are already cooked; I think the techs are already cooked.  I think the healthcare is ready to come off the grill, and getting ready to eat.

We needed all this to happen.  We needed the golds to give up their huge gains. 

We needed to see a second down day in the ethanol players; I'd like to see that PEIX down $5.  I'd like to see that ADM under $40.  We need to see every last winner taken out and shot before we get bullish; before things get oversold, and not that dangerous.

Last night, I said tech was putting in a bottom; I saw that again today - Thank you Hewlett-Packard (HPQ)!

Now, the oil service stocks, I saw a bottoming in that index today.  Healthcare bottomed a while ago.  Financials, as represented by the BTX - the bank index, they evidenced a real bottom - failure of any of the major banks to go down.  Not the brokers - not the GS, not the BSC, not the LEH - they're not done; they need more - sell, sell, sell! - before they finish.

The other sectors are coming.  As the market bottoms - and we're so close I can taste it - we've got to continue to pick at stocks.  Just pick - and still be patient and let the bears picnic.

When things get this bad, we go bargain hunting.  A bargain isn't a broken company; it's a broken stock.

A broken stock like Qualcomm (QCOM)!

QCOM makes the brains behind cell phones.

I think QCOM is the ultimate 3rd generation cell phone network play.  Especially as 3G gets rolled out all over the world, especially in Europe and Japan.

They do all this because they're the masters of CDMA (Code Division Multiple Access) - the technology that makes most digital cell phones possible.

QCOM stock should be massively overprices right now, but we got a lucky break!  9 tenths of successful investing is luck!  The other 10% is being prepared to capitalize on that luck.

I think QCOM has sold off because of this ITC Staff finding.  Listen!  Everyone is misreading this!  But still, how about a worst case?

What could the damage be if QCOM loses?  QCOM won't have to stop production of anything. 

I think this dispute ends up being resolved either with a cash payment or some sort of settlement.

QCOM be cheap for a bad reason.  It seems like this ITC ruling is being blown out of proportion.  The selloff is overdone.

When you buy this stock, you're not just buying a stock in a co. that makes the brains of cell phones - strong business - you're getting more than that.  You're also getting a co. that raises guidance like it's nobody's business!  Buy, buy, buy!

It's like QCOM has taken the art of UPOD (underpromising and overdelivering), and raising it to a whole new level.

The bottom line!:
  QCOM be a great tech stock, a cheap tech stock, and a tech stock that knows how to play the expectations game like a pro!"

Wednesday Night's Stories

'Chicos and the Man'
After a smart 'dont buy' call a month and a half ago, Jim says it is now time to trade.

'Cell Side'
Qualcom is the king of UPOD (underpromising and overdelivering).  Now is the time to buy.

'At Your Service'
A look at Oceaneering Intl., where they are, and where they are going.