NEW YORK ( TheStreet) -- It's politics, as well as stocks, that will have Jim Cramer's attention next week. He told the viewers of his "Mad Money" TV show Friday that next week's game plan is jammed packed. Cramer said perhaps the most important event for stocks next week is the special election in Massachusetts on Tuesday. He said a Republican win in the Senate would be a huge win for the bank and oil stocks, not to mention health care and the drug makers.
Shadow Inventory PlayFor "Speculation Friday," Cramer discovered a way to make money from the so-called "shadow inventory" of foreclosed homes currently owned by banks and mortgage lenders. He said the little known Altisource Portfolio ( ASPS) is one of only a handful of companies that actually benefit from increased foreclosure activity. Altisource is in the business of helping banks streamline their foreclosure activities, saving them money in the process. Cramer said the company is similar to Lender Processing Services ( LPS), which he featured on Sept. 29, 2008 and which is currently up 34%. Cramer said with no end in sight to the wave of home foreclosures, the speculative Altisource is the perfect play. The company is virtually unknown, with only one analyst covering the stock. Altisource trades at just 9.7 times its 2011 earnings, but maintains a 20% long-term growth rate. "Altisource knows how to foreclose right," said Cramer. Given the company has a technological edge over its competitors, Cramer said this little speculative stock is worth a closer look.
Mea CulpaCramer issued a "mea culpa" to viewers for two stocks that he recently got wrong. "We must learn from our mistakes," he told viewers, "we must be accountable." He said he highlights his mistakes on "Mad Money" so that everyone can be sure not to repeat them. L-1 Identity Solutions ( ID) was the first stock that Cramer admitted he got wrong. He recommended the stock on Oct. 16 at $6.86 a share and reiterated a buy on Oct 28. After rising slightly, the stock has fallen to about break-even. Cramer said his mistake was believing management's comments that a single bad quarter was an anomaly and not the beginning of larger problems. He said the fundamentals at the company continue to deteriorate. Upon closer examination of the company's performance, Cramer said it seems L-1 is a mix of smaller businesses that are simply not integrated well. Tessera Technology ( TSRA) was Cramer's second mistake. He recommended the company on May 26 around $20 a share, and reiterated buys on Aug. 11 and Oct. 6. Tessera shares are now lower than the original recommendation. Cramer said Tessera suffered from the same problem as L-1. The company conveyed a dismal fourth-quarter outlook, but Cramer believed management, who told him the worst was behind them. Cramer said he fell in love with the overarching theme, instead of being skeptical of a company that just missed its earnings. Cramer said the takeaway from these misses is a new "strike-one-and-you're out" rule. He said any company who misses earnings must redeem themselves with one quarter's of good earnings before it can be bought. He said taking management's word that things are getting better is no longer acceptable.
Mad MailCramer followed up on National Beverage ( FIZZ), a stock which stumped him earlier in the week. He said he's not a fan of this second-rate beverage maker, and prefers to stick with Pepsico ( PEP), a stock which he owns for his charitable trust,
Lightning RoundCramer was bullish on Alaska Communications Systems ( ALSK), Amgen ( AMGN), Gilead Sciences ( GILD), Celgene ( CELG), SanDisk ( SNDK), Taseko Mines ( TGB), SPDR Gold Shares ( GLD), Eldorado Gold ( EGO), Hasbro ( HAS) and Netflix ( NFLX). He was bearish on AT&T ( T). -- Written by Scott Rutt in Washington D.C. To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.