As the economy recovers what is the best way to play financials? Jim Cramer has a few ideas. With the exception of JP Morgan ( JPM), he is cautious on international banks, as they continue to face lingering effects of the housing crisis. Banks still face an inventory of homes that they can get rid of and the costs associated with those homes. In particular, he said, Bank of America ( BAC), with its large inventory of homes could face challenges for a very long time. He sees the potential for earnings to expand, however, if home values rebound due to low interest rates and the affordability of the market, diminishing inventory and the number of employees needed to service it. "They have a huge number of people who don't generate any revenue. All they do is work on this stuff. You can get rid of those people and you get rid of the inventory and then you get earnings expansion," Cramer said. Regional banks, he said have outperformed the international banks and he sees them continuing to trade better. The one exception is JP Morgan, where Cramer sees the potential for a breakout, as net interest margins improve and revenue grows. "I just think that there's a breakout here. They are going to be able to turn out a lot of capital. Jaime Dimon is the most competent I have seen in years. That's just my favorite play," Cramer said.