Cramer's 'Mad Money' Recap: Stocks for After the Fed Cut

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The Federal Reserve finally got it right today when it cut interest rates by 50 basis points, Jim Cramer said on his "Mad Money" TV show Tuesday.

Although he has been hard on the Fed, said Cramer, it's time for him to admit that the Fed is no longer acting crazy. It was acting as if inflation were the biggest worry, but now the Fed has recognized the economy's liquidity problems, he said. "I believe the crisis will soon be over."

The Fed has recognized that the fundamentals of the American economy are not sound and that home and job issues are more important than inflation right now, Cramer said.

However, over the next couple of weeks, the bears are going to go to the media and say the rate cut doesn't matter, he said. Market players should pay no attention to these people. "They are totally wrong," Cramer said.

He believes this 50-basis-point cut is the first of several cuts. "I see three more rate cuts," Cramer said. Therefore, he doesn't want investors to sell when they hear that the rate cut doesn't matter. Maybe the housing industry won't turn on this cut, but it should in three more cuts, he said.

The bears are going to go on TV and say that the Fed doesn't know what it's doing and that the cut is bad for inflation, but that's "baloney," Cramer said. They need the market lower, but the "sellers' strike" won't let them get what they need, he said. The bears are now in a jam and likely won't have any stock to buy back to cover their shorts. "The shorts will be squeezed."

In terms of stocks, "almost everything works now," he said. Wachovia (WB Quote) has been rescued and should now go higher, and "Google(GOOG Quote) is going to break out," Cramer said.

In addition, Foster Wheeler (FWLT Quote), Deere (DE Quote) and Caterpillar (CAT Quote), the latter of which Cramer owns for his charitable trust, Action Alerts PLUS, should work now, too, he said.

In oil, Exxon Mobil (XOM Quote) or ConocoPhillips (COP Quote) should both work, Cramer added.