The State of The Market

On a day when the market is really down, it helps to know what – and who – got it there. On Wednesday’s Mad Money, Cramer highlighted the few things, and people, he believes are responsible for this sell-off.

First, there’s a panic rippling through the market that can be traced back to the weak U.S. dollar. There was a report that supermodel Giselle Bundchen demanded to be paid in euros instead of U.S. dollars. That story ended up being false, but unfortunately the facts aren’t always important as the rumor. Things are bad when even the world’s supermodels know the dollar is falling hard, Cramer said.

On the heels of the Giselle non-story, an official with the National People’s Congress of China said China should dump weak currencies in favor of stronger ones. He later recanted the statement, but again, that barely matters, Cramer said. The fact is people are jittery enough about the sagging dollar that rumors alone can set off a panic.

On top of that, New York Attorney General Andrew Cuomo has taken it upon himself to start a probe of Washington Mutual , the country’s largest savings and loan and a company already swooning from subprime losses. Cramer’s no fan of WaMu – he called for CEO Kerry Killinger’s ouster on Monday – but a subpoena from Cuomo won’t do anything to quell the real problems in the mortgage market, he said.

Overzealous regulators like Cuomo will just make the lenders afraid to lend, according to Cramer. What the market really needs are lower down payments so the lenders can get back to the business of lending. And Cramer only sees things getting worse if the attorney general continues to go after Fannie Mae and Freddie Mac – the two institutions the U.S. absolutely needs to prevent a total mortgage collapse.

But it doesn’t mean there isn’t money to be made, Cramer said. There are weak dollar plays abound and there’s always “indestructible” stocks like Altria and Coke that tend to perform in any market. And don’t forget about oil and tech. Buy what works, just avoid the financials like the plague, he said.

Jim's charitable trust owns Altria.

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