Cramer's 'Mad Money' Recap: Battle of Bulls and Bears (Final)

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NEW YORK (TheStreet) -- "Why are the markets so hard to understand," a puzzled Jim Cramer asked the viewers of his "Mad Money" TV show Wednesday.

He said it's hard to make sense of the market when it's down 97 points one day, and up 120 points the next. Or is it?

Cramer broke down today's market action by examining the performance of its two IPOs, Starwood Property Trust (STWD Quote) and healthcare billing provider Emdeon (EM Quote). He said that Starwood's IPO, priced at $20 a share, was a total flop and broke its opening price immediately. The reason? Cramer said the deal was priced too high, and investors are still scared of another crisis in commercial real estate.

Shares of Emdeon on the other hand, priced at $15.50 a share, rose a quick $2.50 on its opening. Cramer said this deal was not only priced correctly, but it's also in one part of the economy that's actually growing. It's clear when comparing these deals, he said, that investors are both cautious, and optimistic, at the same time.

Regardless of sentiment, Cramer said the fact remains that mutual fund and hedge fund managers are seeing huge inflows of new capital, and need to put that capital to work. He said the market could correct, perhaps as much as 3% to 5%, but that correction will be shallow given the amount of new money that needs to be invested.

Cramer said he remains bullish on tech and banks like Bank Of America (BAC Quote) and Wells Fargo (WFC Quote), two stocks which Cramer owns for his charitable trust, Action Alerts PLUS, along with Citigroup (C Quote).