Publish date: TV Recap: Bernanke Did You Hear Me?

Cramer says the Fed understands the credit problems a bit more, but still is too focused on inflation.

Jim Cramer said he wonders if


Chairman Ben Bernanke "is willing or is able to see that things are still very bad out there."

Cramer, speaking on TV's Wall Street Confidential

Web video Wednesday, said he has been relieved that the Federal Reserve has acknowledged that homeowners are having some problems and that there are credit issues surrounding the market. Cramer has used his blog on

and his TV shows on


to express his relief.

But Cramer said that when he parses the Fed statement, it's clear that although the Fed has made some movement and seems concerned, "in a lot of ways they are bluffing about how good things are."

The inflation part of the system is actually generated by the agriculture complex because of a fixation on renewable fuels, such as corn-based ethanol, and by minerals because of a fixation on oil, he said. Bernanke doesn't recognize that China demand is driving those prices.

"The reality is there's really not a lot of inflation in the system," Cramer said. The Fed has not made the phone calls it should to the people who are involved in mortgages and the banks and asked them what's really going on with their balance sheets, he said.

"If they had, I think they would have gone immediately to a measure where they're not more

concerned about inflation than they are about the credit problems and the worrisome economy.

"They don't want to do that because they are, frankly, I believe, genuinely sanguine," Cramer continued. "They think things are OK."

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If they had made the call, he believes, they would have done what he wanted, which is to gravitate more toward an eventual rate cut. Instead, what the Fed did yesterday was delay the cut, Cramer said.

Now, it has to hold two more meetings before it will be able to cut. During the next meeting, the Federal Open Market Committee has to "drop the language about inflation," and then at the meeting after that, the members have to say they're going to begin to ease.

"That means that there are a lot of people who will not get there," he said. "I think that a lot of the mortgage companies have to go, I think a lot of people will continue to give the keys back to whomever they can find who made the loan for their houses, and it makes economic sense to do so."

Bernanke is more clued in than Cramer had believed when he did his

Friday rant on "Stop Trading!" Cramer said. However, Bernanke is not as clued in as Cramer would like.

"If he was

as clued in as I would like, then he would have been far less worried about inflation and far more worried about deflation, because what's happening in the housing industry is deflationary," he said.

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