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The Dow Jones Industrial Average is down more than 350 points Thursday, but Cramer has always been a buyer on days like this. It’s just a matter of knowing what to choose.

Go after companies that just reported good quarters, he said. Pepsico, Kellogg, Bunge and Celgene are all Cramer picks.

Anyone watching Mad Money this week knows that technology stocks should do well in this environment. These companies have lots of cash and the fall bull market season is about to start.


But the bottom line is that some parts of the market are just bad, especially those with exposure to housing.

“Some of these homebuilders aren’t going to make it,” Cramer said, concurring with Erin Burnett that some companies could end up in bankruptcy.

Don’t go near the banks, either, Cramer said, at least not until estimates are cut and the layoffs are done. Companies like Bear Stearns and Lehman Brothers that had beefed up their mortgage and corporate credit divisions will most likely be cutting staff, he said.

According to Cramer, it’s not until after these two things happen that the Federal Reserve moves in to help. While it might not look like the Fed cares right now, “the Fed doesn’t like to tell us what they’re going to do,” he said.

Cramer has been saying that he recommends shorting JPMorgan Chase to $38, but he’d let it ride if the estimate cuts and layoffs haven’t happened yet.

Questions for Cramer?

Questions, comments, suggestions for the Mad Money website?