Cramer's 'Mad Money' Recap: Two Roads to Recovery

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"Whenever you have a selloff, there are two ways to approach the stock market," Jim Cramer said on his "Mad Money" TV show Thursday.

Those two approaches to playing the recovery are the value method and the momentum method, he said.

The value method tells investors to look at the new-low list for stocks that are down 20% from their 52-week highs and that pay at least 3% in dividends. Cramer believes that this approach uncovers companies that the hedge funds were forced to sell, or "good companies with broken stocks" -- not companies with serious flaws.

Cramer believes that there are further interest rates cuts coming from the Federal Reserve. If true, he said, dividend-paying stocks will increase in value.

As a "value method play," Cramer likes Aircastle (AYR Quote), a company that owns and leases jets. Aircastle, off from its 52-week high in June, was "knocked down by sellers concerned with the credit crunch," he said.

The company's "entire portfolio is leased out," he said, and it is shifting to buying and leasing freighters, which give better returns than passenger planes.

Cramer added that the company's COO recently bought 2,000 shares and that insiders "only buy for one reason: They think their company's stock is going up."

On the value method, Cramer also liked Genesis Lease (GLS Quote), which he first recommended last May. The stock is down 15% since then, but it has an 8.2% yield and $1.2 billion in capital.

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