NEW YORK (TheStreet) -- On Thursday's "Stop Trading!" segment on CNBC, Jim Cramer focused on banks and the news that hedge fund manager John Paulson had bought 35 million shares of Regions Financial (RF) - Get Report.

"Everybody's chatting about

Bank of America

(BAC) - Get Report

," a stock Cramer owns for his

Action Alerts PLUS

charitable trust, but Regions "is the big trade," he said.

Cramer said Regions' management is "not so great" and its bad loans "are really off the charts," but Paulson bought it anyway. "This man understands the business," said Cramer. "The guy was short mortgages! Regions Financial is a living, breathing mortgage."

As for

Citigroup

(C) - Get Report

, Cramer said the "government's up huge on this," yet FDIC Chair Sheila Blair is intent on getting rid of Citigroup CEO Vikram Pandit. "Let him do his job," said Cramer.

Cramer's retail play off of

Wal-Mart's

(WMT) - Get Report

earnings report is

JCPenney

(JCP) - Get Report

, which he thinks "is going to repeat what Wal-Mart did."

Finally, Cramer pointed to a Morgan Joseph piece about

Palm

(PALM)

that said that orders for its Pre phone are down.

-- Written by Rebecca Corvino in New York.

At the time of publication, Cramer was long Bank of America for his Action Alerts PLUS charitable trust.