Cramer's 'Mad Money' Recap: Rumor Mill Grinds to Halt

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When things get ugly, rumors drive the market. And when rumors get overextended, people witness a rally like today's, Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

"If you missed today's rally, I want you to know who kept you away," he said. "I want you to know how the game is really played so you don't get played."

Nobody can stop rumors from happening, and once one is started, it spreads like fire through the Street, Cramer said. Stocks get sent down on rumors all the time, but on Monday there was a rumor that went too far, and market players witnessed the rumor cause a bottom, he said.

There were rumors that Wells Fargo (WFC Quote - Cramer on WFC - Stock Picks), MBIA (MBI Quote - Cramer on MBI - Stock Picks) and CIT Group (CIT Quote - Cramer on CIT - Stock Picks) were heading south, Cramer said.

But these rumors had no substance and instead became a good entry opportunity into these stocks, he said.

If investors had taken a closer look at the situation, they would have seen that there was no reason to believe these three stocks had reckless subprime lending, Cramer said.

Cramer says he's giving Wells Fargo the "benefit of the doubt" and believes that the company is the opposite of reckless subprime lending. Additionally, CIT and MBIA, according to Cramer, had no business being attached to these rumors.