The market turned ugly this week, as Jim Cramer saw the same elements that wreaked havoc in the past return. Once again, the strong dollar and lower oil have managed to sink stocks.
"Perception always trumps reality, at least initially. Sooner or later, though, we will settle into a fact-based situation where we can try to make money off of what is actually happening, not the bogus nightmare scenarios that are so easily traced out," the "Mad Money" host said.
Crude has now declined more than 20 percent from its recent highs. Cramer found it remarkable how much investors didn't care when oil plunged to $40 a barrel from $50. The entire market still moved higher as it happened.
However, when oil dipped below $40 a barrel last Friday, black gold once again coupled with the averages and took stocks down. This is because of a growing belief that auto companies, which reported weak sales on Tuesday, are signaling a slowdown and the weak oil market signals the same thing, Cramer said.
"This is the demand story I keep talking about, that there just isn't enough demand out there or oil would be going up, not down," Cramer said.