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When the market is getting crushed, sooner or later you need to start bargain hunting, Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

Bargains are found in ice-cold sectors that people hate, ones that can make market players money. And the bargain right now is in the natural gas sector, he said. The stocks in this sector have become too cheap and are trading like value stocks.

Right now, said Cramer, natural gas is trading in the lowest gas-to-oil ratio that he can remember. Cramer believes the bears are going to be dead wrong when it comes to the natural gas market.

When we have a warm winter, natural gas goes down one point; but when we have a harsh winter, it could go up four points, said Cramer, and that's a good risk/reward.

Since we are value hunting, said Cramer, we want the stock that represents the best bargain in the natural gas market, and that is Carrizo Oil & Gas ( CRZO - Get Report). It is Cramer's play, he said.

Houston-based Carrizo is a large player in the Barnett Shale, a source bedrock in northern Texas that is producing natural gas through bacteria breakdown.

Carrizo, which as of December 2005 operated 106 oil- and gas-producing wells, also has exposure to the Gulf of Mexico, Cramer said.

The bottom line is that this is not a hot group or a hot stock, it is a cold stock in an ice-cold sector, he said. Carrizo is a cold stock because natural gas is way too cheap.

When a caller inquired about Cheniere Energy ( LNG - Get Report), Cramer said he liked it when it was lower, but did not recommend it now.

"The problem with liquefied natural gas is that I don't think that any of its terminals are going to be built," Cramer said.

Reading's Fundamentals

"Yesterday, I believe we found a bottom, or a near-bottom, in WCI Communities ( WCI," said Cramer, who featured the stock on Monday's show, Finding-Bottom Dollars. "Today I believe we have another bottom which might make you money."

In a bottomed stock, the downside has been shaken out. It can only go so much lower. Momentum players don't know about these stocks, but Cramer loves the bottom stocks, and he particularly loves that they are coming back up.

The bottom stock Cramer recommended to his viewers was Reader's Digest ( RDA.

Everyone knows about the existence of this publication, Cramer said. He believes Reader's Digest has bottomed, but if it does go down, it will do so by only a few more cents.

"I am not arrogant enough to believe any stock has reached its absolute bottom," he said.

Right now Reader's Digest is at its 52-week low, but that's not enough because it might reach a new 52-week low; however, Cramer doesn't think it will. He believes it has already been shot and sold.

Reader's Digest has a great new management team, it doubled its dividend and the company is improving its free cash flow. It's a great brand name and should stop declining in price, he said.

However, value-wise, the company needs to correct itself, Cramer said. Reader's Digest shareholders are becoming unhappy and change needs to happen. Cramer believes if the company sells its Books Are Fun division, which it acquired in 1999, the stock could soar.

"It is a classic bottom stock," Cramer said.

A caller asked Cramer if the print media was dead and if Internet stocks were better. He responded that he is not a believer in the New York Times ( NYT because of its dual ownership.

He said he likes CBS ( CBS, Disney ( DIS and News Corp ( NWS.

"They are all on the march up," Cramer said. Also, Comcast ( CMCSA may be the early winner in the telephone war, he said.

Three Kings of Cash

"Cash is the best defense in a bad market," Cramer told viewers. "Cash is king right now."

Cash means flexibility, it means the company can perform buybacks, it has a cushion in case of a nasty selloff. In this particular market, cash is the queen, rook and bishop, too, he said.

But cash isn't everything, if the company's not strong. An example of a bad company that's flush with cash is Gateway ( GTW, said Cramer. Players should avoid Gateway, Cramer advised. It is only worth the cash it has in the bank.

The three cash kings, he said, are:
  • Apple Computer (AAPL - Get Report)
  • Cnooc (CEO
  • Schering-Plough (SGP, which he owns for his Action Alerts PLUS charitable trust.

Sears Holdings ( SHLD, another stock he owns for Action Alerts PLUS, and Deutsche Telekom ( DT are two other great cash stocks, he said.

Talking Ethanol

"This market has gone from loving speculative plays to despising them," Cramer told his viewers. "I like speculative plays that are making a lot of money, even if right now they are cool."

Cramer welcomed Tim Newkirk, the COO of MGP Ingredients ( MGPI - Get Report) to his show.

MGP's two core businesses, said Newkirk, are the food ingredients business and the distillery business, in which it has a segment of a fuel-ethanol business, which has taken off dramatically.

Is it true if you don't add a little percentage of gasoline to ethanol, it is labeled as alcohol? Cramer asked.

Yes, that is true, said Newkirk, adding that to make nonfuel-grade ethanol requires different sets of equipment.

If you look back at the industry, it has always met demand requirements, Newkirk said. There is a tremendous amount of hype, to the point of overhype. There is good money to be made in this business, both by companies and their shareholders, but the hype is a little on the exuberant side right now, he said.

"If you want to speculate on ethanol, this is a good company," Cramer said, He said he likes it more than even Archer Daniels Midland ( ADM "at these prices."

To view Cramer's interview with Newkirk, click here.

Lightning Round

Cramer was bullish on Citigroup ( C, ING Group ( ING, National Oilwell Varco ( NOV, Burlington Northern ( BNI, Oceaneering International ( OII, Carrizo Oil & Gas ( CRZO - Get Report), Foster Wheeler ( FWLT, WCI Communities ( WCI, KB Home ( KBH and Sealy ( ZZ.

Cramer was bearish on E*Trade Financial ( ET, Wachovia ( WB, Avaya ( AV, JDSU ( JDSU, Helix Energy Solutions ( HELX, Cemex ( CX, Honeywell International ( HON and D.R. Horton ( DHI.

For more of Cramer's insights during the most recent Lightning Round, click here.

Here's your chance to pick the stock you'd like me to feature on my radio show June 15:
Chesapeake Energy
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REMEMBER to listen in on Thursday for my take on the stock that wins this poll!


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At the time of publication, Cramer was long Foster Wheeler, Sears Holdings and Schering-Plough.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on Mad Money are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."

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Some of the stocks mentioned by Mr. Cramer on "Mad Money" are held in Mr. Cramer's Action Alerts PLUS Portfolio. The Action Alerts PLUS Portfolio contains all of Mr. Cramer's personal investments in publicly-traded equity securities only, and does not include any mutual fund holdings or other institutionally managed assets, private equity investments, or his holdings in TheStreet.com, Inc. Since March 2005, the Action Alerts PLUS Portfolio has been held by a Trust, the realized profits from which have been pledged to charity. Mr. Cramer retains full investment discretion with respect to all securities contained in the Trust. Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast.