There is one story Jim Cramer has heard from everyone's lips these days, and it basically questions how it could be possible that the stock market isn't soaring higher on the news that oil is collapsing.
Instead, the market fell on Tuesday when oil dipped below $30, and it only rallied in the afternoon when oil bounced back and closed down only 3 percent.
"With oil at $30, pretty much straight down for months now from June of 2014, when Brent hit $114, you would think we would be dancing in the streets. I can recall whole bull markets based on the falling cost of fuel," the "Mad Money" host said.
The visibility of the decline is so scary that it now colors the entire stock market.
This is how the combination of a once in a lifetime decline in everyone's budget and the budget of millions of corporations does not translate into a stock market rally. It is playing against the appalling losses of the oil companies themselves. It has prompted investors to ignore the positives of the decline and focus only on the negatives, Cramer said.
"We need to respect the fact that something good for the economy, lower oil, can actually be a negative for the stock market, at least short-term, no matter how wrong it might turn out to be over the long-term," Cramer said.
In other words, until oil stabilizes — at any level — do not expect a real relief from the sell-off.
One stock that was on Cramer's mind was Darden, the parent of Olive Garden and Longhorn Steak and many others. On Tuesday, Cramer learned that top activist firm Starboard Value announced it would trim its position and replace the entire board and management of Darden.
"If you only bought it because you were following the moves of an activist hedge fund manager, then you probably should sell it. You don't know anything and you did no homework, so what else are you going to do?" Cramer said.
But for those investors that did the work on Darden, than Cramer thinks that the answer is to keep the stock. Those investors have conviction, and can just accept that Starboard is having a big win and is ringing the register.
Another conundrum that Cramer faced on Tuesday is what the heck investors are supposed to do with Dow Chemical and DuPont now that they have agreed to merge and then break up the combined company into three separate businesses: agricultural chemicals, material sciences and specialty products.
Cramer thinks this move could create tremendous value, but at the same time it is a very tough environment for any company with agriculture exposure.
To learn more, Cramer spoke with Dow Chemical's chairman and CEO Andrew Liveris.
"The macros here are everywhere and nowhere. And the only thing that is going to come through here eventually is companies that perform… This deal makes so much sense. For years Dow has been asked how are you going to grow in agriculture. What are you going to do with Dow AgroSciences? Well here is the answer."
With the average stock in the S&P 500 down 20 percent from its highs, Cramer sees the backdrop of the stock market becoming more negative by the day. That means his investment strategy must change with the environment.
Investors are gripped by the tremendous deflation of commodities while battling the fear of the Fed raising rates, and the Chinese market changing from day-to-day. This was why Cramer prepared his checklist of events that must occur in order for the market to get out of its current funk.
Cramer does still believe in the stories of Fitbit and Alcoa. But right now, it does not matter. Cramer said he was wrong about the environment, and that is a huge factor that he should have taken into account.
"That is why I am issuing a mea culpa for Fitbit and Alcoa. We are not in the right moment for speculation. I should have known better and I regret that I wasn't more cautious, even as I remain confident in the long-term value of both the stocks and the companies behind them," Cramer said.
This year so far has also been very difficult for certain biotech stocks. Novavax is the vaccine developer that lost 25 percent of its value since the year began. Some of this is because the stock had skyrocketed so much in 2015, up 41 percent for the year.
The other reason is because Novavax just happens to be the kind of speculative biotech that investors want to cash in on right now. To learn more about where the company could be headed, Cramer spoke to Novavax CEO Stanley Erck.
"We have capped out just a terrific year. We started the year initiating five clinical trials, and we unblended the trials and all the data were great … We are in for an exciting year," Erck said.