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Cramer: 5 Reasons the US Is Not Europe

"Repeat after me: we are not Europe. Repeat after me: we are not in 2008."

Cramer repeated this mantra on Monday, as the S&P 500 index fell to its lowest level of the year, putting it on the edge of a new bear market. As U.S. stocks are crushed by news of out Europe, Cramer gave five reasons why the two places are very different.

First, Cramer noted the U.S. has one currency: the U.S. dollar . It actually works, too, he added. Unlike in Europe, nobody in the U.S. is trying to kick out a given state because of its dollar denominated debt.

Second, Cramer pointed out that the U.S. has a central bank. The Federal Reserve is decisive in trying to keep interest rates low, so businesses can thrive and people can refinance, he said. Europe, on the other hand, has multiple central banks and they're not always in agreement.

Third, the U.S. can react much faster than Europe. At the height of the financial crisis, for example, the U.S. Congress was quick to pass the Troubled Asset Relief Program. Signed into law by President George W. Bush on October 3, 2008, it allowed the government to purchase assets and equity from financial institutions to strengthen the financial sector and address the subprime mortgage crisis. In dealing with its own problems, Europe has acted slowly, Cramer said.

Fourth, the U.S. has a great wealth of natural resources, Cramer said. America simply needs to focus on how to correctly use them. Europe lacks a natural base because it used up most of its resources long ago.

Finally, Cramer said Europeans refuse to deny just how bad things are or that their banks are weak. The U.S. is aware of what problems the banks are facing. These problems have hurt the banks' earnings power, but hasn't threatened their very existence. We learned all of this in 2008, Cramer said. Europe is going through it now.

But how do we know it's not the dreaded 2008 all over again? There are three reasons why things are very different now, Cramer said.

First, corporate balance sheets are incredibly strong. Since 2008, Morgan Stanley has shrunk its balance sheet, raised billions in cash and brought in large investors, among other things. Of course, its stock hasn't gotten any love from Wall Street and Cramer isn't recommending it either. Nonetheless, it's an example of how one financial institution has turned itself around.

Second, earnings are holding up fairly well despite being brought down by Europe's woes. The S&P 500's forward price-to-earnings multiple is at an amazingly low 10 times earnings, which Cramer noted is not at all a crash level.

Third, Cramer said there are many backstops today. The Fed and U.S. Treasury Department are working in tandem to make sure there's not a single institution that could crush us.

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

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