Money madman who declares capitalism is crazy

To celebrate international Earth Week, the television empire NBC has asked America's favourite share tipster to infuse his daily Mad Money broadcast with a green theme. As the minutes tick down to showtime in his chaotic New Jersey studio, Jim Cramer is anxious for props. "Do we have jungle music?" he demands. "How about a pith helmet? Can you find me a pith helmet? It's like an upside down round thing - and it's hard!" As the cameras flicker into life, Cramer begins his prime-time hour by crouching, crab-like, in an indoor tree and gesticulating vigorously with the branches as he urges viewers to invest in natural gas. Every so often a snippet of "The Lion Sleeps Tonight" blares out.

His shambolically cluttered set includes a Wall Street sign, an oil painting of himself, a picture of Che Guevara, a packet of Uncle Ben's rice bearing a photo of the Federal Reserve's Ben Bernanke and a large collection of squeezy plastic pigs. "The notion of teaching through entertaining is something that you don't find a lot of," says Cramer after the show. "There's a very big entertainment component - and I don't mean that to say it's not rigorous."

Cramer, 53, has a vast following among America's millions of armchair investors. His act, in which he hurtles dementedly around his studio on the business channel CNBC yelling stock tips, moves share prices daily, and his angry rants routinely become viral videos on the internet. During a phone-in segment, Cramer delivers on-the-fly advice to William from Oklahoma, who holds shares in Chesapeake Energy, and to Steve in Florida who gets tips on hydrocarbons. Each caller greets Cramer with his catchphrase - "boo-yah!"

It is brash, tacky, greedy and flashy. Yet after the cameras shut down, Cramer is unapologetic. "I call myself the most sincerely insincere man in North America," he says. "But I've been given a great thing which is an hour of national TV that I can use to affect people and make them interested in the market. I'm a kind of a televangelist for money."

A Harvard law school graduate who made a fortune as a trader, Cramer is more than just a clown. He co-founded the news website TheStreet.com, where he is paid a salary of $1.3m (£650,000), and he is arguably America's best known financial commentator. Off-camera, an encyclopaedic mind is evident as he sprinkles esoteric historical references into his rapid-fire analysis of America's economic crisis - for which he holds laissez-faire policies in Washington partly responsible.

Cramer says that under Roosevelt, Truman and Eisenhower, there was a proud tradition in the US of regulating capitalism to ensure it was fair - until the neo-conservative era dawned. "Capitalism is supposed to be regulated," he says, citing the need to protect the public against dodgier hedge funds and sub-prime mortgage brokers. "The marketplace is really stupid, rapacious at the margins. It's a remarkably inefficient and brutal world."

Citing rocketing food prices while crops are diverted to ethanol production, he compares the US Treasury secretary, Henry Paulson, to the 19th century British prime minister Lord John Russell, whose free market policies were blamed for exacerbating the Irish potato famine in the 1840s.

Cramer reserves his greatest ire for the Fed's Ben Bernanke, who, he maintains, was complicit in fuelling the housing boom. "Anybody who looks at his legacy will see he's laissez-faire, laissez-faire, laissez-faire," says Cramer. "If you go back and look at his speeches in 2004, 2006, he was very much in favour of the kind of exotic home equity mortgages which are now part of a $400bn morass."

There were 14m homes sold in the US between 2005 and 2007, Cramer points out, of which a large chunk were on sub-prime mortgages. In the meantime, the Fed kept raising interest rates.

"Where was Bernanke? Did anyone sound the alarm on the rapacious strategies of the mortgage brokers? No - because they thought the market was terrific and the market could handle it," says Cramer, gathering a head of steam. "The market was so out of control that it almost destroyed capitalism as we know it but these guys thought it was just fine because the market's never wrong.

"It's that hubris - that belief in the market, that Ayn Rand 'Fountainhead' nonsense that became our mantra in our country. It's embarrassing!"

His disdain for Bernanke has become a long-running campaign. One of Cramer's top ten predictions of the year is that Bernanke will lose his job. In a red-faced on-air tirade last August which became required viewing on Wall Street and beyond, Cramer let rip about the mild-mannered Fed chief, yelling: "Bernanke is being an academic! It is no time to be an academic ... he has no idea how bad it is out there! He has no idea! He has no idea!"

With hindsight, Cramer admits that his agitation can occasionally become "cartoonish", adding that he briefly feared that he had suffered some kind of aneurysm with the aggression of his outburst which has been viewed more than 2m times on YouTube.

Back in his days running a hedge fund, Cramer's temper was legendary. A former employee, Nicholas Maier, wrote a book recounting how a difficult trading session once prompted his boss to smash a phone on his desk and heave a computer monitor across the room.

Fiercely competitive, Cramer has since run into trouble by acknowledging his familiarity with some of the more dubious methods of hedge funds - such as shorting stocks and then spreading rumours to push down the price. This practice, known as "fomenting", is illegal - but "you do it anyway, because the securities and exchange commission doesn't understand it" he told one interviewer. He later insisted that he was not talking from personal experience.

Cramer acknowledges that he behaved like "Stalin" when he was running a fund: "I had a huge chip on my shoulder, I didn't have a lot of money. I felt that in order to get it right, we had to work 18 hours a day. I couldn't tolerate yawning, I couldn't tolerate sneezing because that meant somebody was going to be ill and off work."

That chip on his shoulder may have been to do with a turbulent early career. He worked as a newspaper reporter in Florida and California before suffering a series of catastrophic mishaps in which his home was burgled and his bank account was emptied. In his autobiography, Cramer recounts being homeless for nine months and sleeping in a car in California with a gun for protection.

A father of two young daughters, he rises at 4.15am every day to stay on top of the stockmarket. But critics have questioned whether his track record is actually any good. Cramer's website, TheStreet.com, has a bewildering database of thousands of his stock tips but doesn't keep a running total. Barron's magazine worked out last year that he was broadly in line with the market, but concluded it was almost impossible to judge because of the variety of his on-air exclamations. Does pressing a button which emits a bull-like sound effect count as advising viewers to buy?

Cramer reacts to scepticism by pointing out that as a hedge fund manager, he returned 24% annually after all fees over a 14-year period: "Over a very long period of time, I made a lot of people a lot of money."

Recently, Cramer faced catcalls over remarks about Bear Stearns in response to a viewer's email just days before the bank went bust. "No, no, no. Bear Stearns is fine - do not take your money out!" Cramer thundered on his show.

Defending himself, Cramer points out that the viewer was asking about Bear's liquidity, rather than its shares - and that he was advising those with deposits at the bank not to withdraw their funds, rather than to hang on to the stock.

"It would have been better if I'd said 'sell, sell, sell' - that would have been a home run call," he admits. "But it could have maybe wiped [the bank] out because some people say the show's that powerful."

Just how responsible is it for an avowed Democrat to be urging the public to put money in stocks?

"They're watching this network because they want to do it," he says. "Man, if you don't like me, it's a gosh-darned TV show, turn it off for heaven's sake."