Cramer's 'Mad Money' Recap: Routing the Short-Sellers

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"There's an epic battle going on in the markets," Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

Donning rose-tinted glasses, Cramer said that while the bulls may have won today's fight, the battle continues to rage.

Cramer: Opportunity Knocks for Banks

Returning to a thesis that he first discussed last month, Cramer reiterated how the Securities and Exchange Commission's decision to rescind the "uptick" rule early this year has given short-sellers the ammunition to force stock prices lower at the expense of average investors.

According to Cramer, taking away the uptick protection is like giving hedge funds and short-sellers a "Gatling Gun" to mow down any stock they see fit.

Cramer said there was one bright spot in the war against the bears: Lehman Brothers' (LEH Quote) surprising secondary offering, which fetched $4 billion of additional capital for the firm.

"Up until now," Cramer said, "the financials have been running on credit and credit is a lousy weapon in this war." But with Lehman's new found capital, the company should no longer be vulnerable to the "bear raids" that have been plaguing much of the sector.

Bottom line: Cramer said investors should "enjoy the rally," but remain cautious, because without the uptick rule, the bears are likely to strike again.

A Sunny Outlook

Cramer said there is nothing sexier than a company taking control of its own destiny and transforming itself to succeed in a new economy. That's why he's recommending Applied Materials (AMAT Quote), a stock he has hated for years.

While he is still not a fan of the semiconductor business, Cramer said Applied Materials has a secret that Wall Street hasn't noticed yet: its blossoming solar business.

Applied Materials recently announced a $1.9 billion order for a gigawatt solar facility. The order underscores the company's CEO belief that the solar business is the greatest opportunity his company has ever seen.

Cramer said momentum is starting to build in Applied Materials, which he noted is flush with cash, as much as $2.28 a share, for continued investment in solar ventures.

He likened Applied Materials' prospects to that of Cypress Semiconductor (CY Quote) a year before it spun off its SunPower (SPWR Quote) solar division.

Cramer says Wall Street still values Applied Materials as a semiconductor equipment stock, but as news of the company's solar division continues to surface, he sees up to 50% in upside potential.

Land Drilling Resurgence

"We are at the beginning of a new land rush in natural gas," said Cramer. That's why he's changing his position on Nabors Industries (NBR Quote), a stock which he has disliked for more than three years.

"It's comeback time," said Cramer, who now predicts U.S. land drillers will become good investments. And he said, "Nabors is the way to play." However, he said the company will likely see one more bad quarter before it truly bottoms.

According to Cramer, Nabors has 89 idle drilling rigs that are currently idle. These rigs, which account for almost a quarter of Nabors' fleet, should soon see deployment as companies such as Chesapeake Energy (CHK Quote) and others ramp up domestic gas drilling operations.