Marcus Rashford scored and provided two assists as United ran riot against the league's bottom side, although Aboubakar Kamara replied from the penalty spot.
United were 3-0 up before the break and Ranieri, whose side have one point from three games after beating Southampton in his first game in charge, accepted Fulham were completely outclassed.
"In the first half it was 11 lambs against 11 wolves. The wolves ate the lambs," Ranieri said to BBC Sport.
"The second half was much better but I have to consider if that was because they were winning 3-0 or we made a good performance.
"We have to be stronger, more confident in our qualities. Without the strength, the power, it is difficult. Manchester United have everything – qualities, power.
"In the first half we were shy, we were waiting. Why? Why were we waiting? Go, play football. Then, if they score, it is normal. I want my team to play and fight for every single ball. In the second half, we did. Why we didn't in the first half, I need to speak with my players.
"The response in the second half was positive. We played with more intensity, we were hungry, everything better than the first half. The first half was a warm-up."
Andre-Frank Zambo Anguissa's red card less than a minute after Kamara's penalty made it 3-1 extinguished any faint hopes of a Fulham fightback.
And Ranieri felt the dismissal, Anguissa shown a second booking for a foul on the impressive Rashford, was the wrong call by referee Lee Probert.
"I want to speak about all the game, not just about the decision of the referee. Referees can mistakes, managers can mistakes and players can make mistakes. That's football," he said at a post-match news conference.
"We scored a goal and that moment there was a fall, but I didn't see it on the pitch. I watched after on video. My player touched the ball only and the referee gave the second yellow card. At that time it changed the match because the first minute of the second half was much better for us.
"We showed what we need to do if we want to stay in the Premier League. I told my players the first half is to be relegated, the second half we can survive. It's very clear, our match today. We have to react, think about it and we have to have desire to be in the Premier League next season, as nobody gives a gift."