"When the Federal Reserve starts cutting, I like to look for stocks with high dividends, simply because people will be flushed out of cash," Jim Cramer said on TheStreet.com TV's Wall Street Confidential Web video Friday.

"Cash makes no sense, there is no upside," Cramer said. "Rates are obviously now headed down, and any stock that has a good dividend is now headed up."

Cramer asked David Peltier, research manager at TheStreet.com, for three dividend-raising names he likes in the current environment.

"I still do like US Bancorp ( USB)," a stock that is putting 80% of its earnings into buybacks and dividends, Peltier replied. Warren Buffett just doubled his stake in USB, and as Buffett "was the best bank buyer in the last bank crisis," according to Cramer, Peltier said he would definitely want to follow Buffett on this stock.

Another name Peltier said he likes is Reynolds American ( RAI), a tobacco manufacturer that Cramer recommended on his "Mad Money" TV show Thursday. "It's a good tobacco play still yielding over 5%," Peltier said.

Although RealMoney.com contributor Charles Norton is saying that cigarette makers Carolina Group ( CG) and Altria ( MO), which Cramer owns for his charitable trust, Action Alerts PLUS, would be much better, Cramer asked Peltier if Norton was "missing the point that you want to buy someone who's raising dividend right now."

"I think so," Peltier said. "When we were down the last two or three weeks, I ran a lot of screens, screens of companies that are raising dividends, screens of companies that beat their earnings. You want to go back to the quality here. That will be the stuff that rebounds three or four months from now, not just today."

In the utilities sector, Peltier said he likes Consolidated Edison ( ED). Its steam-pipe blowup in midtown Manhattan suggests that the utility may need to raise its rates because there is a lot of infrastructure that needs to be replaced.

"For the 5% dividend yield, it is the best one you're going to get for a utility that has an A-rated balance sheet," Peltier said of Con Ed. "It's held up quite well. You get the 5% dividend plus 10% price depreciation every year, very low risk.

"If a company is going to raise its dividend 5% to 10% every year along with the earnings, that stock is probably going to go up at the same rate," he said.

At the time of publication, Cramer was long Altria.

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. Outside contributing columnists for TheStreet.com and RealMoney.com, including Cramer, may, from time to time, write about stocks in which they have a position. In such cases, appropriate disclosure is made. To see his personal portfolio and find out what trades Cramer will make before he makes them, sign up for Action Alerts PLUS. Watch Cramer on "Mad Money" weeknights on CNBC. Click here to order Cramer's latest book, "Mad Money: Watch TV, Get Rich," click here to order his book, "Real Money: Sane Investing in an Insane World," click here to get his second book, "You Got Screwed!" and click here to order Cramer's autobiography, "Confessions of a Street Addict." While he cannot provide personalized investment advice or recommendations, he invites you to send comments on his column by clicking here.

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