Although talk of a recession has some investors spooked, stock market veterans like CNBC's Jim Cramer see it as an opportunity to pick up undervalued stocks. On a recent episode of "Mad Money," Cramer discussed the economy and two stocks he believes are worth buying during any potential dip.

"As long as you don't think the entire economy is about to fall off a cliff, and there's still some of us who feel that way, then some of these high-quality retailers are looking darned cheap at these levels," he said. "Ralph Lauren [(NYSE: RL)] and the Gap [(NYSE: GAP)] are my faves right now." That may be surprising, considering that Cramer said the retail sector was in the "blast radius" of a trade war.

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There may be a method to Cramer's madness. He acknowledged that the immediate effect of tariffs would be to drive prices up and slow consumer activity. That's normal anytime there is a sudden price increase for products that people have grown accustomed to getting for less. However, Cramer doesn't think the slowdown will last forever.

He said that the "tariff reign of terror is temporary," meaning consumers will either become accustomed to the elevated prices or that a settlement will be reached between President Trump and the countries he's targeted for tariffs. In either case, the retail sector would rebound, and any stocks that took a hit during the recession would also make a comeback.

Cramer explained his reasons for picking Gap and Ralph Lauren as potential buys during the downturn. He cited Gap's recent strong quarterly earnings report as evidence that the turnaround led by new CEO Richard Dickson is working. Cramer wasn't the only person impressed by Gap's performance. According to CNBC, the company's stock jumped by 17% in overnight trading after the company's March earnings release.

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The report shows Gap exceeded analysts' earnings per share expectations by 42% and outpaces revenue expectation by 1.94% with a $4.15 billion quarter. Dickson said Gap's supply chain will only be minimally affected by Trump's tariffs because it sources less than 10% of its products from China and less than 1% from Mexico and Canada, the three nations that Trump's retail tariffs are currently targeting. Gap is also paying a 3.09% dividend.

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Cramer's other retail pick, Ralph Lauren, is also coming off a strong quarterly earnings report. The company's $4.82 earnings per share beat expectations by 6.40%, and its $2.14 billion in revenue bested the analysts' predictions by 6.67%. However, Cramer sees other factors playing in Ralph Lauren's favor. He believes the company's history as an upmarket brand and a symbol of high living will give it additional staying power.

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Both factors translate into a wealthier client base than many other retailers, and consumers in that economic strata will be less deterred by a temporary price increase. That's why Cramer thinks Ralph Lauren will be among the companies at the leading edge of the rebound once retail bounces back. It doesn't hurt that Ralph Lauren shareholders can earn a 1.44% dividend on the company’s $225.16 share price while waiting for the turnaround.

Cramer did add one big caveat to his bullish predictions on both stocks. He admitted he doesn't know how long you might have to hold them before the turnaround starts. "If you buy them and the president basically assures you that the forecast is pain, there's not much you can do short term. But longer term, you will do fine – I just can't predict when longer term starts," he said.

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This article Jim Cramer Says These Retail Stocks RL, GAP Can Survive A Market Correction originally appeared on Benzinga.com

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