Stock-Raving Mad

By Daniel Kadlec

It's minutes to airtime, and Jim Cramer is pacing the set like a caged beast. He scans the five screens on his desk, stops, punches some keys. "Hmm. The Chinese Google plays are up," he mumbles. He furrows his brows, pokes a few more keys. "Whoa. Wells Fargo gave up on the brokerage business." He's talking aloud to himself, which is fine, because this is just a warm-up for the barrage of instant analysis he is about to unleash. Cramer's knack for quick distillation enabled him to build a fortune as a fast-trading hedge-fund manager in the '90s. Now he's using the same reflexes to resuscitate ratings at the financial cable station CNBC, whose fortunes deflated with the Internet bubble.

Mad Money with Jim Cramer is a raucous investor show that features vertigo-inducing camera movement and the blustery, hyperkinetic Cramer bouncing around the set howling stock-market strategy. He punctuates his advice with a battery of noise effects: "Sell! Sell! Sell!" a voice booms through the studio after Cramer hits one of 15 large red buttons on the set; another one elicits a Hallelujah Chorus.

Gimmicky? You bet. But the program, in stark contrast to shows like the staid, departed Wall Street Week, is a clear success. Mad Money has boosted viewership in its 6 p.m. E.T., weekday slot 74%, to 176,000, and is on an upward trajectory. Cramer has the network's highest-rated program in a slot that had been home to its lowest. Pleads program developer Susan Krakower: "Find me another Cramer, please!"

CNBC has a long way to go to recapture the success of its bull-market heyday. Ad revenues last year were just $140 million, vs. $383 million in 2001, reports Kagan Research. Overall ratings remain depressed, even though onetime rival CNNfn went dark last year. And a new financial channel is expected at Fox next spring, so there is a sense of urgency in the place. CNBC, a division of GE's NBC Universal, has tried everything to reinvent itself, including going Hollywood. That failed experiment led to the cancellation of prime-time shows with hosts Dennis Miller, John McEnroe and Tina Brown. The network lost its way, says Bill Cella, CEO of Magna Global, an ad-buying firm. "They need to get back to their roots: solid business programming." Mad Money offers a template, because Cramer is well grounded in business yet just crazy enough to test old boundaries.

On air Cramer dishes up buy or sell advice for dozens of stocks every night. He occasionally contradicts himself, as he did with Citigroup, when he gushed over the stock's dividend a few weeks after saying the stock was "broke." "I find it, from a financial viewpoint, embarrassing," says John Markese, president of the American Association of Individual Investors. "He's the financial Jerry Springer."

Cramer says he keeps track of every stock he picks; every Friday, he cops to bad calls. "I approach this with as much rigor as I can," he says. "But you have to make this stuff come alive, or no one will watch. I believe I am making people better investors." His analysis ranges from reasonably in-depth for the stock-of-the-week segment to almost nil during the exhausting lightning round--15 minutes of pure chaos, during which Cramer offers rapid-fire, unscripted advice to callers, who invariably start with "Booyah, Jim!" When the lightning round breaks for an ad, staff members rush to blot the sweat from his head, apply makeup and top off his soft drink. "This is the real me," Cramer says.

It took a long time for reality to set in. Cramer, 50, was successful but miserable managing his hedge fund. A bad trade would precipitate a phone-bashing, computer-hurling tantrum. But Cramer's barbed quips led to frequent CNBC appearances and to a show with economist Larry Kudlow, whom Cramer found too tilted toward politics. "I really hated interviewing Senators," Cramer says. "You have to be so respectful." Today "he skips down the hall," says Mark Hoffman, CNBC president.

Oh, Cramer still manhandles the equipment. There's a scar on the set where he regularly boots his chair; he has smashed phones and props. But it's contrived rage, designed to hold the attention of investors who haven't had much to grip them, which Cramer undeniably does. The last week of July, every stock he talked up in the analytical segments of his show traded higher the next day--some by a wide margin.

Yes, Cramer is moving the market, in more ways than one. Now CNBC is planning another business-oriented, personality-driven show to follow Cramer's. Furniture breakers are welcome to apply.