Cramer's 'Mad Money' Recap: Get Ready to Sell

Pulling Back From the Abyss

"Our financial system is built on confidence," Cramer told viewers, as he tried to explain in plain English what the federal government's recent actions really mean to the markets.

Cramer said had the government not taken the actions it did, consumers next week may have found their bank's local ATM machines out of cash. He credited Paulson for single handedly preventing a run on our banking system.

Until this week's actions, Cramer said the government's takeover of Freddie Mac (FRE Quote), Fannie Mae (FNM Quote) and AIG (AIG Quote) had done nothing to restore confidence in the markets and had managed to spend $900 billion of taxpayer's money.

However, he said the government is now trying to do everything, from buyouts to trusts to regulations, to restore stability.

Cramer said it took a decade to recover from the Great Depression but Paulson's actions will usher a much quicker recovery, despite the size of the current market collapse. The only downside, he said, will likely be just a few hedge fund failures.

As for the pricetag of the bailout, Cramer said the government should not suffer as much as some believe. He said many of the mortgages now owned by the government hold value, and it's possible to still reward responsible borrowers while punishing the reckless.

Cramer called the bailout a "coherent plan" and the best thing the U.S. government has done for the American taxpayers in a long time.

Private Food Label Play

Despite the market's huge rally, Cramer said there are still some stocks worth buying. On that note, he recommended private label food maker Ralcorp Holdings (RAH Quote).

Cramer said the discounter, which competes against General Mills (GIS Quote), should do well for consumers who are trading down to cheaper products during harder economic times.

He said Ralcorp reminded him of Treehouse Brands (THS Quote) which he said is up $18 since he recommended it on Aug. 18, 2007 at $24 a share.

Cramer said Ralcorp should benefit as grocery chains get more aggressive about pushing their private label brands. But he said the real catalyst for the company is the falling costs of commodities, which should flow right to the bottom line of the company.

He also sees Ralcorp as a potential acquirer if consolidation in the industry occurs.

Mad Mail

Cramer told a viewer that the wife of investor Boone Pickens called him regarding the large sale of Clean Energy (CLNE Quote). According to Pickens, it was her stock, not his, that was sold for personal reasons and both she and he, still support the company.

Cramer told another viewer that Goldman Sachs (GS Quote) is not in the "Sell Block" although he acknowledges the negative pressure the firm, and the stock, is under.

Lightning Round

Cramer was bullish on AT&T (T Quote), Verizon (VZ Quote), Barrick Gold (ABX Quote), Yamana Gold (AUY Quote), Exelon (EXC Quote), El Paso (EP Quote), Nucor (NUE Quote) and SandRidge Energy .

Cramer was bearish on EMC (EMC Quote), American Express , National City (NCC Quote) and Annaly Mortgage .

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