we are in a stock market crash
the s p was already down . at the
close of trading on friday and this
morning on pre-market trading it is down
another . so we are now down .
percent from the peak at the beginning
of january which takes us over the
line and most people will consider to
be a typical market wobble to be a
correction and once you go over that
mark you have a market crash we haven’t
got a name for this one yet just like
the dot com crash in or the
financial crash in i’m sure there
will be one coming any minute now if you
have a good name idea please stick it
down in the comments below if you are
invested in the stock market you will be
seeing your portfolio smash the pieces
so far this year especially if you’re
invested in any kind of growth or
earlier stage companies that got sold
off way way harder than the market
average so far and this market crash
could get a heck of a lot worse we are
only down by i know it seems like
it’s been a long time coming but back in
the financial crash the s p went
down by
from peak to bottom and then the dot-com
crash it went down by if this crash
decides to go and do something similar
we are not even halfway down if you
thought this was bad you just wait
because this time around we have some
seriously nasty catalyst that we did not
have in the previous market crashes if
this russian invasion of ukraine
continues and gets worse we could easily
have the biggest energy crisis we have
seen with oil and gas prices already off
the charts in the last few days a war of
wars has erupted between china and the
united states about taiwan and if we
were to have any kind of military
conflict result from there that would
dwarf the ukraine situation because
china and taiwan just happen to produce
pretty much everything that the world
consumes in terms of electronics and
many other consumer goods many of the
biggest companies in the s p are
entirely or very largely reliant on
china and taiwan for their production
and then we have the fastest rising
inflation in history that is already
sitting at . as of last week and the
threat that it now is going to go and
get out of hand because the fed and
other central banks around the world are
still sitting around scratching their
ass instead of taking any meaningful
action and we have the threat of a huge
recession where consumers will stop
spending altogether and the global
economy will go into a downward spiral
we just had data come out this morning
confirming that the uk economy has
shrunk by . in april after already
shrinking by . percent in march the us
economy shrank in q this year against
all expectations and although people are
expecting a bounce back it may well not
come so there are plenty of reasons for
investors to be concerned the mood out
there is sour stocks keep dipping week
after week after week even the almighty
hedge against the big bad fiat economy
bitcoin is down nine percent in the last
hours down in the last week and is
now trading lower than back in december
. how peculiar that the deflationary
asset that is not reliant on central
banks not reliant on governments
completely immune from the woes of the
rest of the economy seems to be
massively affected and directly impacted
by the actions of central banks the
actions of governments and the broader
economy anyway i actually have a very
important point that i want to make so
please listen up because this is really
really crucial we are now in a market
crash and market crashes do not come
around all too often especially big bad
ones that last excluding the two flash
crashes in and in march this
is only the fifth major stock market
crash in the last years if you are
watching this and you are in your s
s or s this is the single biggest
investing opportunity you might have in
your life let that sink in because the
vast majority of investors will not take
advantage of this opportunity they will
choose to not take advantage of this
opportunity i know this because exactly
the same thing happens every single time
and it will happen again because people
have emotions and most people let their
emotions affect their decision making
when the market is crashing and all the
stocks are down on average some down
or even
most investors decide to do one of two things
one sell stocks before it gets worse
because what’s the point of holding
stocks if they are continuously falling
what if they fall down to percent
even though they’re only down surely
it makes perfect sense to go and sell
now before it goes all the way down and
then go and buy them back at the very
bottom when everything around you spells
doom and gloom this is a perfectly
natural feeling it seems logical it
seems obvious and there will be plenty
of people all over the news all over
social media absolutely everywhere
telling you to do exactly this there
will be people in the comments section
of this very video telling you to do
this exact thing in fact you will see a
lot of people that will tell you how
they
perfectly timed and sold back out in
december and are now waiting patiently
to perfectly time the bottom they
haven’t bought back in yet it is amazing
how many of these people magically appear out of absolutely
nowhere at times like these and they’re very very
strange that these same people seem to
not be around very much sharing this
wonderful hindsight back in december and
the second thing that investors do is
they stop investing it is the classic
issue where investors were lining up in
their droves to buy their favorite
stocks at peak prices just a few months
back but absolutely do not want to go
and buy the same exact stocks of the
same exact companies with the same exact
projections in some cases better
projections when the price has fallen by
fifty percent nobody wants to catch a
falling knife you go and buy a stock and
next week it’s five percent or ten
percent down much better to wait and
then buy when it falls all the way down
even further unfortunately the power of
hindsight is not as great when you’re
trying to predict the future and the
overwhelming likelihood for every
investor trying to perfectly time the
market is that you will go ahead and
lose a colossal amount of money instead
i know it is very disappointing that
we’re not all perfect fortune tellers
and i know that the voices of the few
who tell the exact opposite ring much
louder in your ears but it’s just a fact
and i’m not here to sugarcoat it or sell
you a magic pill that will make
everything better you can go and read
any foundational economic study that you
want the outcome is the same if you go
and sell your stocks after you’re
already or or down or whatever
and you then go and try to time the
bottom on average the overwhelming
likelihood is that you are going to lose
money compared to doing nothing at all i
know i know sasha the boring perma bear
is too scared to make board moves i am
going to be poor for the rest of my life
and i suck because i can’t perfectly
predict every single market movement
using tea leaf patterns or tarot cards
and if you are holding cash waiting for
the perfect time to enter the market the
mathematical likelihood is again that
you will lose a lot of money compared to
just dollar cost averaging each and
every month each and every week as and
when you happen to have money to invest
in the stock market in fact a market
crash makes this point way more relevant
you are staring at a stock market where
everything is on sale pretty much the
stock that you wanted to buy for a
hundred dollars very recently now costs
fifty dollars and you are sitting there
wondering
what if i can wait and buy it for just
forty dollars surely that would be an
amazing idea because then i would be
able to write it all the way back up
from forty to fifty dollars and hey
presto i’ve made a huge amount of money
and you know what the reason is for why
you’re sitting there thinking that
thought it’s greed when you see stocks
going up on price you want to buy right
now whatever the price is it’s kind of
irrelevant because you are greedy you
want to get that growth that you keep
seeing every other week you are seeing
everyone else benefits so you want to
get a piece of the pie as well you see
stocks going down in price and you
suddenly do not want to buy them at all
because they might fall even more it is
amazing how greed can rapidly shift your
perspective and completely change how we
approach some of the most important
decisions in life a stock market crash
and the potential of recession will mean
that a lot of companies that were valued
in pure hype will die
companies that have weak balance sheets
with piles of unsustainable debt will
also die companies that are loss making
with no path to making a profit will die
and everyone invested in those types of
companies is going to lose their money
this has happened before this will also
happen again but there will be plenty of
other companies that do have robust
businesses that actually do make profits
or have sustainable robust realistic
paths to making profits there are
companies that aren’t going to suffocate
because their debt repayments will
skyrocket as interest rates go up there
are companies that will grow and deliver
value even during a recession just like
it’s inevitable that the stock market
will crash every now and then it is also
extremely likely that it is going to go
back up and hit all-time new highs at
some point in the future because people
are enterprising people tend to create
value over time that is how the global
economy works as an investor you only
have so many times in your life when the
stock market lets you invest at a
massive discount money you invest during
a downturn will yield a much greater
returns than the money you invest at all
other times if you want to get that or
return per year that the stock market
gets on average you have to invest
during a stock market crash if you do
not invest through a market crash and
instead you choose to wait you will not
get your or return because this is
where the money is being made in fact if
you only invest when the market is going
up and then sell in a panic when your
stocks are down you will end up
losing a ton of money on average over
the long period of time
this is the moment to act
because it might take another or
years until the next market crash comes
around and presents yet another
opportunity and the money invested
during this one will have or years
to work before i might have another
opportunity to go and shop in the sales
aisle so i’m going to be going to the
stock market shop every single time i
happen to have spare cash and i’m going
to keep buying my favorite stock so the
big fat yellow discount stickers on them
while most other investors sit around
waiting for the sale to end so that they
can have the opportunity to start buying
them again at full price
