Cramer's 'Mad Money' Recap: Get Ready for the Bears

Paul said Fed lacks oversight and is more secretive than the CIA. The Fed "ought to be more open," he said, noting the government doesn't have any interest in it and is neglectful, he said.

Paul said he saw the housing bubble and credit crunch problem coming a long time before Ben Bernanke became the Fed chairman. Over time, it got worse, reached a climax and has been total chaos the last year, Paul said.

When Cramer asked why the Fed doesn't see the bigger picture that 7 million people could lose their homes, Paul said it's because they believe in themselves too much. He always hears people talking about how interest rates are too low or how they're too high.

Instead, said Paul, market forces should determine interest rates.

Paul lamented the condition of the economy, with the standard of living going down, the dollar going down and the U.S. dependent on borrowing money. Despite this situation, he said his fellow candidates don't realize a domestic problem persists.

"I don't think they've heard the message," the congressman said. "They don't have an understanding of monetary policy" and if they do, they like the benefits from the current policy.