Click here for an archive of Cramer's "Mad Money" recaps.

"I've been an addict ... like

Thomas De Quincey. ... And I'm here to tell you how my past addiction to options could make you money," Jim Cramer told viewers of his "Mad Money" TV show Tuesday.

Options are a serious way to make money on Wall Street, he said, adding that trading

Merck

(MRK) - Get Report

options is what allowed him to quit his job and start a hedge fund.

"Options are more addictive than coffee. You put down very little money and if your stock explodes you could make a fortune," he said.

But the problem is that options trading is so risky that Cramer likens it to a game of Russian roulette.

Cramer said that you should be a professional or feel very comfortable with the extraordinary amount of risk to actually trade options, but nevertheless options trading is on fire.

So how do you make money off of the trend? Cramer says to take a look at

optionsXpress Holdings

(OXPS)

, one of the few online brokerages that trade options.

Last quarter the company's earnings soared 80% year on year, and revenue jumped 56% over the same period, he said, adding that Wall Street will pay anything for this kind of growth and that the company has room to run higher on the options trading boom.

Off to the 'Racinos'

When state governments have budget problems, they usually try to shaft the poor, said Cramer, but higher taxes and budget cuts are not politically palatable.

So to reach into the slim pocketbooks of people without money, politicians will turn to state-sanctioned gambling, he said.

That's why he believes

racinos

, combination racetracks and casinos where the gambling is usually limited to slot machines, are the wave of the future.

States can take up to 52% of profits from slots, he said. And with about 30 states experiencing budgetary shortfalls and 10 to 15 states expected to pass pro-racino legislation, Cramer sees room for growth.

Image placeholder title

That's why he said to consider

International Game Technology

(IGT) - Get Report

, which has 70% of the slot machine market.

He believes that as the number of racinos grows, the real racino money will go to International Game Technology.

Plus, there are 830,000 slot machines that will someday need to be replaced, Cramer said, with 145,000 replacements worldwide expected in 2006. And he said that International Game will reap the rewards from the replacement cycle, too.

Greenberg's Take

Senior

MarketWatch

columnist Herb Greenberg joined Cramer to spar over the merits of

Portfolio Recovery Associates

(PRAA) - Get Report

.

Even though Cramer

likes the stock and other analysts believe it has a great CEO-CFO combination, Greenberg said that he's more concerned about the quality of the company that purchases, collects and manages portfolios of defaulted loans.

Most importantly, he said that receivables are going down and that there's been a slowdown in collections. "There are other choices in the field," Greenberg added.

In a move that Cramer called "television suicide," Greenberg said he liked an airline stock.

He recommended

ABX Air

(ABXA)

, a "freight airline without the fuel," as a way to play

DHL

.

Greenberg that the DHL spinoff trades for next to nothing and flies planes and all sorts of packages for the delivery company.

"This I like," Cramer said, giving it one-and-a-half thumbs up. Plus, Greenberg said that thanks to its deals with DHL this airline doesn't have to pay for fuel.

New Beginning for Vivendi?

Viewers who turn their attention to

Vivendi Universal

(V) - Get Report

before the analysts do could make a lot of money, Cramer said.

The company he calls "Wall Street's forgotten stock" has been best known as a bloated entertainment company. But, as reported in

The Deal

, the company is profitable and Cramer said that it's in the midst of a stealth turnaround.

The company was ruined by countless superfluous acquisitions, he said, but it has sold off $27 billion in assets and kept its best departments.

The company still has big entertainment companies, including Universal Music Group, but Cramer said the company is really a great play on wireless technology in Europe and North Africa.

Vivendi owns SFR Cegetel, the No. 2 French mobile-telecom operator, which delivered slightly more than 40% of Vivendi's revenue.

And the mobile-technology game is a money game, Cramer added.

Lightning Round

Cramer was bullish on:

Conexant

(CNXT) - Get Report

,

Schlumberger

(SLB) - Get Report

,

Anglo American

(AAUK)

,

Myogen

(MYOG)

,

Walter Industries

(WLT)

,

Consolidated Edison

(ED) - Get Report

,

Alkermes

(ALKS) - Get Report

,

Whole Foods

(WFMI)

,

Matsushita

(MC) - Get Report

and

Sony

(SNE) - Get Report

.

Cramer was bearish on:

Evergreen Solar

(ESLR)

,

YRC Worldwide

(YRCW) - Get Report

,

BlueLinx Holdings

(BXC) - Get Report

,

Baidu.com

(BIDU) - Get Report

,

UAL

(UAUA)

,

Neoware Systems

(NWRE)

and

Wild Oats

(OATS)

.

For more of Cramer's insights during the Lightning Round,

click here.

Want more Cramer? Check out Jim's rules and commandments for investing from his latest book by

clicking here

.

At the time of publication, Cramer was long Anglo American.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."

None of the information contained in "Mad Money" constitutes a recommendation by Mr. Cramer, TheStreet.com or CNBC that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. You must make your own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy mentioned on the program. Mr. Cramer's past results are not necessarily indicative of future performance. Neither Mr. Cramer, nor TheStreet.com, nor CNBC guarantees any specific outcome or profit, and you should be aware of the real risk of loss in following any strategy or investments discussed on the program. The strategy or investments discussed may fluctuate in price or value and you may get back less than you invested. Before acting on any information contained in the program, you should consider whether it is suitable for your particular circumstances and strongly consider seeking advice from your own financial or investment adviser.

Some of the stocks mentioned by Mr. Cramer on "Mad Money" are held in Mr. Cramer's Action Alerts PLUS Portfolio. When that is the case, appropriate disclosure is made on the program and in the "Mad Money" recap available on TheStreet.com. The Action Alerts PLUS Portfolio contains all of Mr. Cramer's personal investments in publicly-traded equity securities only, and does not include any mutual fund holdings or other institutionally managed assets, private equity investments, or his holdings in TheStreet.com, Inc. Since March 2005, the Action Alerts PLUS Portfolio has been held by a Trust, the realized profits from which have been pledged to charity. Mr. Cramer retains full investment discretion with respect to all securities contained in the Trust. Mr. Cramer is subject to certain trading restrictions, and must hold all securities in the Action Alerts PLUS Portfolio for at least one month, and is not permitted to buy or sell any security he has spoken about on television or on his radio program for five days following the broadcast.

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