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People need to know where to look for a bull market, Jim Cramer told viewers of his "Mad Money" TV show Monday. Right now, the place to be is in food, drug or telecom stocks, he said.

Even though the current subprime loan problem looks pretty bad, every time there has been a crisis in the market, the Fed has cut rates, Cramer said.

A crisis, he said, gets the Fed's attention and causes it to "slice and dice" rates, which in turn takes stocks higher.

If people get "spooked out," they will miss the "Fed rate-cut nirvana," he warned, urging investors to take a longer-term view.

All markets around the world are not linked, even though they may act like it, he said. Japan is down "big" because the yen has gotten too strong against other currencies. But contrary to popular belief, "this is not bad for American companies," Cramer said. "Their pain is our gain."

Coca-Cola ( KO), whose worst market is Japan, should now "make more money when it repatriates its yen," he said.

In addition, the lack of working-class loans gives the Fed another reason to cut rates, Cramer said. And when the price of commodities comes down, it will be "great," he said, "unless you own those commodities."

Although Cramer stressed that he doesn't want market-players to be in the commodity sector, he said it will be a good thing when they come down because it will cause the Fed to cut.

Cramer told viewers not to hold their breath for all stocks to go down. Companies with big buybacks, which are defensive and have growth which is not dependent on U.S. GDP growth, are the plays that should do well here, he said.

Last spring, the telecom, food and drug stocks did well, Cramer said. "That's where you want to be. That's what's bottoming."

House Rules

"The stock market is far from a casino, but sometimes the metaphor works," Cramer told his viewers.

The investment banks, or "the house," want investors to get back to the table, he said. Therefore, for a short time -- for the next week or two -- the market should tilt the odds toward the customers, or the people who buy stock, and issue initial public offerings (IPOs) at prices below ordinary levels, Cramer said.

"This makes it a great time to make money in IPOs," he said. When everything is "working" in the market, IPO issuers want people to pay more. But now they are offering IPOs at a discount, said Cramer, and investors should take advantage.

In particular, he believes that two stocks about to come to the market -- BigBand Networks, which should trade under the symbol BBND, and Sourcefire Networks, which should trade under FIRE -- should be priced below levels.

BBND is a play on the triple play (Internet, cable and phone service), and it services the telco players and the cable companies, Cramer said. It is one of the "ultimate" arms dealers and "gets the wind no matter what," he said.

The midpoint of BBND's price range right now is $11, Cramer said, whereas, ordinarily, it would be priced higher. Plus it is "growing faster than Cisco ( CSCO)" and is worth more than $14, he added.

Further, as Morgan Stanley ( MS) and Merrill Lynch ( MER) are the lead book runners for BBND, market players should try to do some trades with them to get in on the deal, Cramer said.

Although Cramer said he doesn't like FIRE as much as BBND, he still considers FIRE an IPO that should be priced to move. It is set to go for $12-$14, and he believes it's worth about $16.50.

If people can get in at a reduced IPO price, they should get in, Cramer advised.

Cramer likes these IPOs and believes they will price for less than they should "because bankers want to lure people back into the casino after last week's carnage."

People think the subprime lending crisis is "the end of the world" and that "bankruptcies are running rampant," Cramer said. But when people default on their debt, while it's a problem for some, it's an opportunity for others, he said.

Right now, the bull market is in the companies that make money off of defaulted consumer debt, said Cramer, and one such company is Portfolio Recovery Associates ( PRAA).

The company repossesses everything, including houses, he said. It buys defaulted debt on the cheap and makes money from that. Moreover, Portfolio has the experience and discipline to get people to pay, Cramer said.

However, "the stock has been a victim of panic," he said. The shorts are all over PRAA even though there is nothing to justify their positions. Cramer said he would take this as an opportunity to buy PRAA.

While he doesn't feel that investors necessarily have to get in and buy it tomorrow, Cramer recommended that people get in before the shorts get squeezed and realize that bad credit is good for the stock.

Playing Defense

Ceradyne ( CRDN) CEO Joel Moskowitz joined Cramer on the show and said that the company does not have complete procurement for the Department of Defense.

During Ceradyne's conference call, the company stated that "there would be another major request for a proposal that has not come out yet."

"It is our understanding that will be a five-year requirement," he continued. "That's the biggest we would ever see."

Further, despite Wachovia's worry that Ceradyne's peak margins can't get any better than they are, Moskowitz said they can. He said that the company's yields are improving and that he anticipates that they will continue to creep up with margin improvement.

Cramer said he remains bullish on the stock.

To view Cramer's interview with Joel Moskowitz, please click here .

Lightning Round

Cramer was bullish on Savient Pharmaceuticals ( SVNT), Express Scripts ( ESRX), Alcoa ( AA), Optium ( OPTM), Level 3 Communications ( LVLT), Bank of America ( BAC), Lamson & Sessions ( LMS) and Medtronic ( MDT).

Cramer was bearish on CVS ( CVS), Cyberonics ( CYBX) and JPMorgan Chase ( JPM).

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


Want more Cramer? Check out Jim's rules and commandments for investing from his popular book by clicking here.
At the time of publication, Cramer was long Express Scripts.

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. When that is the case, appropriate disclosure is made on the program and in the "Mad Money" recap available on TheStreet.com. 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.

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