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"All I really want for Christmas is for housing to bottom," Jim Cramer told viewers of his "Mad Money" TV show Wednesday.

He said that when housing bottoms, everything else will recover. But in order for housing to bottom, Cramer said Santa, also known as the federal government, needs to give the economy a few Christmas presents.

Earlier in the year, Cramer called a housing bottom for June 30, 2009. But he said this bottom could come even sooner if the government sets the tone and grants four Christmas wishes. Low home inventory and low interest rates aren't enough by themselves, he said, the government needs to do more.

Cramer said first on his wish list is for Treasury Secretary Hank Paulson to promise not to give a single cent of the TARP money to the homebuilders.

The builders, he said, created this problem by building far too many homes and selling them to unqualified people. If the government gives any aid to the homebuilders, they'll only build even more homes and slow the recovery further.

Second, Cramer said President-elect Barack Obama needs to provide a tax credit to those buying a new home. This, he said, would not be a handout, but rather a reward for all those who sat on the sidelines and waited for the right time to buy a home.

Third, he wants to see some homebuilders go bankrupt or merge. "There are just too many builders out there," he said, addingsupply needs to match demand.

Cramer: Watch the Manipulators

Finally, Cramer said the Federal Reserve needs to keep lowering interest rates until mortgages hit 4.5%. At that level, he said, it'll be too attractive not to buy a home.

Cramer said if gets everything on his wish list for Santa, housing could become the most bullish story of 2009.

Retail Bliss

It's no secret that retailers are in trouble this holiday season, Cramer told viewers. "But where huge trouble beckons, opportunity follows," he continued.

Cramer noted 20 retail stocks currently trade at an incredible $10 or less and indentifed three as his favorites.

First on his list of favorities is Bebe Stores ( BEBE). The company last reported an earnings miss of 1 cent a share on Nov. 6, but noted cleaner inventory after a 10% decline in same-store sales. Bebe also trades at just under 16 times earnings and has a prestine balance sheet along with $3.91 a share in cash and investments and a $30 million buyback program.

Next on the list, Jones Apparel ( JNY). Cramer said this under $4 stock is performing well and taking share from rival Liz Claiborne ( LIZ). The company also has a thriving partnership with Walmart ( WMT) and Macy's ( M). While the 14.5% dividend yield is a red flag, Cramer said Jones might still be at its bottom.

Last on the list was American Eagle Outfitters ( AEO - Get Report). Cramer said this retailer has a clean balance sheet and has increased promotions to drive shoppers back to its stores. The earnings estimates have come down so fast, said Cramer, that the company will be hard pressed not to surprise to the upside.

Stockpickr

Outrage of the Day

Cramer sounded off against the bailout of AIG ( AIG - Get Report). The package, originally billed as an $80 billion loan and a potential win for taxpayers, has continued to snowball out of control with no accountability, he said.

While the auto bailout, a mere $15 billion by comparison, has been met with harsh criticism, AIG shares have slumped 70% with no congressional hearings or outrage of any kind. Cramer said that although it's been proven that for every one auto job lost, nine others will follow, money continues to pour into AIG without question.

Mad Mail

In this segment, Cramer told a viewer he'd sell Rohm and Hass ( ROH) and thinks the chances of the company getting taken over are dwindling.

Am I Diversified?

Cramer spoke with callers to see if their portfolios have what it takes. The first caller's portfolio included: American Electric Power ( AEP), General Electric ( GE), Home Depot ( HD), AT&T ( T) and Pepsi ( PEP).

Cramer blessed this portfolio as diversified and said the caller knows how to play the game.

The second caller's top holdings included Bank of America ( BAC), Diageo ( DEO), Enterprise Partners ( EPD), Merck ( MRK) and Verizon ( VZ).

Cramer said simply, "I love this portfolio!"

The third caller had Con Ed ( ED - Get Report), Verizon ( VZ), Caterpillar ( CAT), Nucor ( NUE - Get Report) and Energy Transfer Partners ( ETP) as their top five stocks.

Cramer said while Con Ed and Verizon were both technically utilities, he'd bless this portfolio as diversified as well.

Lightning Round

In the Lightning Round, Cramer was bullish on Nucor ( NUE - Get Report), Consolidated Edison ( ED - Get Report), Walt Disney ( DIS - Get Report), Allscripts Healthcare ( MDRX)and Anadarko Petroleum ( APC).

Cramer was bearish on Steel Dynamics ( STLD), Sony ( SNE), Las Vegas Sands ( LVS), Chesapeake Energy ( CHK), Visa ( V), Mastercard ( MA)and Alcoa ( AA).

Check out the latest edition of "Cramer's Take onTop-Searched Stocks" on Stockpickr.

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At the time of publication, Cramer was not long on any stock.

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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