"I know more than they do," Cramer said, urging Fed officials to "do more homework" and talk to more CEOs to get a better picture of the pockets of weakness in the economy. "I'm shaken here about what's happening because it's happening faster than the Fed seems to realize." He pointed to the recent sharp drop in oil prices as well as slowing in homebuilders, autos and retailers as signs.
CNBC's David Faber told Cramer on Friday that he's starting to hear about the slowing effect that Cramer has been talking about for weeks. "Business confidence is a question as to whether it's being shaken because of the potential trade war," Faber said, adding he's also hearing that investors are pulling back. "Jim, I got to tell you. I'm starting to agree with you."
Fed officials need to swallow their pride, Cramer said, though he added he did like Clarida's reference to the Fed being "data dependent." Clarida did also say that the central bank is close to the point of being "neutral" on interest rates. But Cramer said any notion that a gradual path higher for the cost of borrowing money is being prudent, is the Fed "fooling themselves" and "being rash."
The Fed may be starting to come around a bit, Cramer acknowledged, but he said Clarida and Fed Chairman Jerome Powell haven't been around as long as he has. Cramer added it should not be held against him that he's on television. He said if he were an academic, the Fed would listen to him.
Cramer said he should have spoken out sooner in 2007 about the Fed being on the wrong track and risking the economy. He said he vowed to himself, after his infamous "They know nothing" rant drew jeers from Fed officials, not to remain quiet in the future. He said that's why he's been so vocal lately. He said he doesn't think the economy is at risk of another Great Recession like in the wake of the 2008 financial crisis. But he said the current economy could really drag and American jobs could be lost if the Fed doesn't change its thinking.
"It's Cramer one; Fed nothing from 2007," Cramer said Friday. "Their record is not as good as mine." He added that central bankers need to "shape up" and "stop being ideological."
On his "Mad Money" show Thursday evening, Cramer said CEOs across industries have been telling him, not for attribution, that they're worried about a slowdown in the U.S. economy.
Cramer has been warning investors since October about a two-pronged, man-made slowdown in the economy, fueled by concerns over the Fed hiking interest rates too quickly and the Trump administration's trade tariffs. Cramer said the central bank probably needs to raise rates next month as the market expects, but it should pause after that. Neither the Fed nor the White House was not immediately available for comment.
The stock market has been under pressure and prone to more volatility since Powell, in early October, said rates were a "long way" from neutral, a level where they're neither restrictive nor accommodative. The current range for the central bank's benchmark rate is 2 percent to 2.25 percent after increasing it three times so far in 2018.