Cramer's 'Mad Money' Recap: Financial Stocks to Avoid

In addition, Capital One recently said in regulatory filings that the delinquency rate in its credit cards has increased dramatically, Cramer said. The company spent a fortune buying back stock when it was expensive and now, at a time when capital is hard to come by, it's in need of every bit of capital it can get its hand on.

Moreover, with "virtually no yield support" and a series of bad numbers on the way, Cramer said he has no choice but to tell people to get rid of the stock.

AIG, he continued, has been adamant that it hasn't been affected by the recent slew of bad loans, but to say it is not enough. According to Cramer, the company needs to show it by disclosing its information.

Further, he doesn't believe the company has the yield necessary to carry it through the market's current environment, he said. AIG and Capital One must be avoided here.

Getting Serious About Oil Exploration

"I believe 2008 is going to be the year for natural gas," Cramer told viewers. "It's leaner, meaner and cleaner than coal."

One of his natural gas picks which represents great value is Anadarko Petroleum (APC).

There are two types of oil and gas companies, Cramer said: the ones with growth and the ones with no growth. He puts Anadarko in the growth category.