Cramer's 'Mad Money' Recap: Aug. 25

Click here for an archive of Jim Cramer's Mad Money recaps.

---

"We need housing to stop hurting us," Jim Cramer told viewers of his "Mad Money" TV show Monday.

He said that until the crisis that has enveloped Freddie Mac (FRE Quote) and Fannie Mae (FNM Quote) is finally resolved, the markets will continue to decline.

Cramer said that sometimes the market just lies as it did today when Freddie and Fannie shares were up while the rest of the financial service stocks fell.

While it's wrong to take all stocks lower because of problems of a select few, that's exactly what will continue to happen until the U.S. Treasury steps in and takes action. He called Fannie and Freddie the root of all market evil.

In order for the market to finally bottom, said Cramer, housing has to stabilize. That requires lower interests rates, lower home inventory and higher home sales, things that cannot happen with speculation still swirling on the fate of Fannie and Freddie.

Cramer said he stands by his prediction that the markets will not take out the lows set on July 15, but that prediction will not hold if the government doesn't step in soon. He started a new "Mortgage Mess Countdown" to see how just how long it takes the Treasury to act and save the market from its continued slide.

3 Stocks I Saw on TV

The Pelosi Endorsement

Cramer said he's putting his money with House Speaker Nancy Pelosi and investing in Clean Energy (CLNE Quote).

He cited a recent Wall Street Journal article, which reported that Pelosi owns somewhere between $100,000 to $250,000 worth of stock in the alternative fuel provider.