TARP Could Cover the Regional Banks

We have a crisis in regional banks, a bad one. We have a bunch of banks with their bonds trading in the 50s -- that's right, the 50s -- which has me very concerned, and should have the FDIC concerned, too, if they look at such things, because they are great measures of who is about to be in trouble next, or is in trouble now.

That's why it is really important that Key (KEY Quote - Cramer on KEY - Stock Picks), Sovereign (SOV Quote - Cramer on SOV - Stock Picks), Regions (RF Quote - Cramer on RF - Stock Picks), First Horizon (FHN Quote - Cramer on FHN - Stock Picks), Fifth Third (FITB Quote - Cramer on FITB - Stock Picks), Comerica (CMA Quote - Cramer on CMA - Stock Picks) and Nat City (NCC Quote - Cramer on NCC - Stock Picks) all go to TARP as soon as it is open for business. I hope these banks don't say, "We don't like the stigma." I hope they don't say, "This is a wait-and-see situation." I hope they take their whole loans, their bad whole loans, both fixed and floating, and get them off the books. They will be able to survive and even thrive, even with stock given to the government.

These are the kinds of companies that TARP is made for. I don't know their CDO exposure, but I know they are loaded to the gills with problem mortgages, and TARP is truly their only hope.

Once they sell the bad loans, they can be bought by a Goldman (GS Quote - Cramer on GS - Stock Picks) or a Morgan Stanley (MS Quote - Cramer on MS - Stock Picks) that needs deposits, or they can go it alone.

That's just terrific. It is one of the first good things that could come of this deal, and it needs to be done tomorrow when TARP starts.

Random musings: Fed buys commercial paper from issuers, but not from holders. Another not-well-thought-out plan that Bernanke gets a kiss from the media for, once again. This guy is charmed! ... How in heck can people be ignoring Royal Bank of Scotland (RBS Quote - Cramer on RBS - Stock Picks)? This is a huge, huge bank, and people should not be yawning about this, any more than they should be yawning about Hypo. ... Run to read Tony Crescenzi's piece on the market clamoring for rate cuts. He is so right, and yet all I hear from others is that it doesn't matter. You must read Tony. You must. He is so right. Meanwhile, it should be obvious that the market has no faith in Bernanke whatsoever. ... The covering from down 350 is obvious -- shorts are still worried about the coordinated rate cuts plus the bounce off of yesterday's lows give or take 100 Dow points.

At the time of publication, Cramer was long Goldman Sachs and Morgan Stanley.