What do you predict will happen with the current stock market crash? Leave a comment below. Download my FREE Stock Market Crash Guide and learn how to navigate your way through this volatile market: bit.ly/3hyJyDL
Thanks good video. Hold on we are in a bumpy ride. At least the US dollar is strong so those that have cash can recapitalise at a strong currency level. Here in BRICS we are not so lucky! Our software, tech and vehicle prices have skyrocketed!
Paul Krugman ~ 2002 "Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble." Sure Paul. Sure. Subprime, No Income/Assets (NINA) for million dollar homes... what could go wrong? Price-fixing the cost of debt does not work.
95% are beginners it feels like. Hyperbally speaking everyone allways just tells you the pe ratio and some odd reason for being bullish. And it seams like 1/4th are All-In tesla channels
Thanks for sharing all your HELPFUL videos. I was born in New Jersey 1997 and after 2008 hit..unfortunately I saw how my parents lost their jobs, the house, and all 3 new cars...now bankrupt all to impress “friends & family”. Man was it rough, but we ended up moving to Charlotte, NC and yet again they still haven’t learned their lesson..”close minded” and struggling, waiting for the government to help them survive. At the age of 20 I left and moved to Houston,Texas alone.. falling into drugs, alcohol, and homeless for a whole year. Chasing fame & friends with the money I did not have! Today I’m 23, a couple months ago I finally freed myself after meeting a mentor, reading for the first time in years and deleting all my social media platforms that I had thousands following. Becoming financially literate and choosing MY LIFE over material things before falling into the “RAT RACE”. I’m stronger, healthier, and now wiser for my generation someday! Once you see how beautiful life is you start to enjoy it without a care the world. I PRAY THAT WE BECOME LEADERS & TEACH OTHERS WHAT THEY CANNOT SEE 💯
Exactly, I agree! That the stock market seems overvalued. The protesting is going to hinder reopening and be a catalyst for the spread of the virus. Timing the market is extremely difficult if even possible. The trick is to diversify your investments, don’t panic when everyone else is and invest consistently.
My humble opinion is that we are facing a period of time like the Great Depression. We are now in the beginning of the Bear Market and it will take a year or two until we see the bottom. There were huge rallies during the 1929 crash all the way through 1930 to 1931. Be careful out there and stay healthy!
yes it is, but the market can only go lower before going back up right? then I am on the right track by investing rn, although I am inexperienced, i am learning fast
@@jeffreymurphy5302 I wonder what are the best opportunities to invest now are, there are opinions but a little later I find out these opinions dont matter as a totally different turn of events play out with the stocks they discussed therein
@@amiracentenososa3847 I'm in the buy, although there is a great bear market I am investing every two weeks because I am seeing improvements in my portfolio, dividends look certain. No short cuts trading online, It might be worth reaching out to some of an highly skilled impartial investment advisor to assist in you. Fortunately, I have owned 2homes in the United states and car dealership all with the an investment capital of $150,000
Hey Phil, I am mostly in cash right now and the FOMO sometimes is killing me but watching your videos helps me a lot to keep on track and stick to my plan. Thanks for doing this!
Hey Phil ! It's Sohit from India (Delhi). I am an avid viewer of your videos for they are so informative. I have gone through the 2008 crash and felt it. You are absolutely right that this covid crash will also have many layers. It's so good to get so much knowledge from an experienced & veteran like you. Lots of love Regards Sohit Sharma Delhi(India)
I needed to hear this. Just sold out of a not so great real estate deal and am sitting in $160k ($AUD) cash thinking what the hell to do now. Never held stocks before, but feel it's better than real estate. Taking my time is the lesson I'm taking from this. Thanks Phil!
Phil your videos are easy to digest, informative and entertaining as well. Keep them coming! What will happen next: We cannot forecast a tight enough range for S&P future earnings. How can we forecast our return with any degree of certainty? The range of possibilities is too large (e.g. a vaccine may come early 2021, but not surprising if we never have an effective vaccine either). What we do know is current valuations (S&P @ 3100-3200) would be reasonable if COVID never occurred and S&P500 earnings around $160/share (even then arguably overpriced). Thus current market prices are ridiculously high, simply put. I believe another large winded drop will come: employment remains stubbornly low, retail continues to suffer and bankruptcies start making their way through the system, indirect effects begin materializing (e.g. bankrupt restaurant owner won't buy newest Apple product, cancel subscriptions, etc.), yield seeking out of bond market slows down, helicopter money program ends and people have to actually withdraw some of their investments.
been red since March and it bothered the crap out of me but now I feel much better about it. now that you pointed out how long the recession hurt the market. I will keep buying shares and look the other way at my 3-month chart only been playing the market for 3 years so still learning and researching.
Town made a nice call to exit equities in his August 2007 appearance on CNBC. He was on about ten days after Jim Cramer threw that on-air temper tantrum in the studio with Erin Burnett, insisting of Bernanke that “he knows nothing!”. Legendary appearances on both fronts.
I believe leases and office spaces will reduce for businesses. Most not all businesses will close as the remainder adapted to teleworking, causing less office space to be used or needed. With Amazon buying malls and JC penny's/Sears makes the most sense. Those office building will most likely turn into condos and new enterprises that I got thinking when I seen a documentary about Singapore.
Thanks for the video, Phil. From here, I think no one will know. The market can always go either way. What I like to do is stress test my portfolio and position myself to be comfortable if the worse happens based on my risk-tolerance. If the stock market declined 50%, I already have an idea of how my balance would look like, but I’d be okay with it because my positions are in companies that have already survived the test of time, and those I can’t see going away. Moreover, they pay dividends so I’ll just buy and hold. If the market does go down 50%, I’ll just add even more to those great positions - again, based on my own risk tolerance.
Thanks Phil for showing the historical evidences during the great depressions. I feel , if the US-China trade relations do not go wild down the line,i am sure global economy recovers at least to the 50% to 60% of pre-covid levels by mid/late 2021. Other major geo-political triggers like "global climate change summit", "brexit" , "decentralizing supply chains","refugee issues" will add fuel to the recovery if properly handled as otherwise the recovery seems tougher and more challenging for the global citizens.
Thanks Phil. I follow few guys with different view on the market . This helps me build an emotionless/ informed decision. Your analysis helps me to rethink and evaluate risks . it balances my greed with rational and patience.
Phil, I would like to personally thank you for the investing gems that you share in plain speak. Always spot on. Keep sharing those insights. I am a reasonably successful individual investor myself thanks to people like you 🙏🏼
Thanks for your education, Phil. Much appreciated. I believe it will go down by 30-40% primarily driven by job loss, loss of manufacuring demand, and over leverage of consumers that continues regardless of reduced income. Many people that lost their jobs are still able to get massive loans which is totally irrational. My neighbourhood has driveways filled with 200k+ worth of vehicles. it's just a matter of when.
I believe we will get a clear idea after getting the next quarter reports of companies. Because it's the performance of the companies which will drive the stock market in either direction not the instinct.
Thanks for the lesson in history Phill. Hopefully the market can recover from this recent crash in a shorter time period compared to the past. I don't think we will have another dip as big as March 2020, but the market will definitely take time to fully recover. I missed a few sales in March, but I think there are still some some great companies still on sale way below their sticker price. There is still time to invest.
Hi Phil, is now a bad time to buy a property near Seattle to be utilized for rental? As you said, the lesson from 1930s crash is to buy assets producing cash flow.
Very good presentation and a very good recap. I think the stock market will go down again when the quarterly results start coming out. How much it will go down further is anybody's guess.
It is true that the current US stock market levels look insane when considering the state of the economy. However, the stock market is an average: many companies (especially in the tech sector) have seen their stock price skyrocketing, while some other cyclical stocks (especially in European markets) are still at record lows, even though they have sound balance sheets, are paying dividends that they can afford, and likely are well positioned to make it through the crisis. I am thinking of stocks in the banking, insurance, construction industry (for example BNP Paribas, Zurich insurance etc.). It seems that several good companies are being penalized in an exaggerated way. Would you keep your “wait and see” advice for all stocks, including these ?
Thank you Phil! What I don't like are these "investors" or "traders" that are springing up everywhere now. Maybe it's because I've been getting into your books and videos that I'm being targeted by ads. But I attended one webinar on Forex trading just to see what this guy was all about. I can tell from his accent that he's from the same area that I'm from in England, so I wanted to give him a chance at least. It was purely gambling! His webinar had fake chatting people saying how keen they are. He was boasting that his trading application has automated rules and macros that watch the market and get in and out at the right times for you. Pure gambling. Then there was another webinar I attended because Robert Kiyosaki was supposed to be speaking there - pure lies. I am grateful that I can see through most BS but I dislike how many people will be duped. It pains me a lot.
Informative video. Thanks for sharing Phil. I agree, we need to own cash producing assets. I tend to prefer cash flowing income property.. Lots of tax advantages with being a landlord. Of course, it comes with its down sides but long term, i would say it is a good investment to retain your wealth.
You explained the house bubble of ‘07 accurately but then called it a market failure... that was not a failure of free markets - as you described, it was the result of massive government intervention into the housing sector creating perverse incentives for banks Edit: great video though providing a long term outlook
Paul Krugman ~ 2002 "Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble." That bubble was blown up for years... around 2002 to 2003, the fed dropped rates drastically and the phones never stopped ringing for banks until rates were yo-yo'd back up to over 5% around 2007.. it isn't quantum physics to understand that housing values would plummet after that... that's when the propaganda started.. that the problem was "greeeed" and other nonsensical and uneconomic explanations... couldn't possibly be someone price-fixing the cost of debt and yo-yoing it all over the place. Oh, and get this.. the way it was suggested to fix it, was to lower the rates back down to effectively zero (.25%) again... for 10 years. lol. Alas, the economy was saved. Glorious.
The Big Short had a little different take on the housing bubble. It was primarily a ratings agency failure and a derivatives bond failure that caused the collapse of the big investment banks which required a government bailout. If the bonds weren't all falsely rated as AAA then the loans wouldn't have been as easy to originate and other stopgaps would have limited the riskiest loans which caused massive defaults. It was mismanagement by the private sector that caused the spiralling collapse, which is why FNMA and FMCC had to be placed under government conservatorship.
Awesome video! It's true the impetus for the bubble changes but the psychological principles behind the creation and destruction of bubbles stays the same. It's pretty amazing the difference in the PE in 1929 versus now. I loved the historical perspective you gave in this video.
How is this the end of bull market when we are hitting all time highs? So basically you had a month where we crashed and had to figure out when to get in.
Who crashes the market and who stops the crash? Isnt it all the huge funds and banks? Average investors just follow them when they sell off or buy a lot.
Hi Phil! Since there's a bubble-like scenario in the stock market and opportunities for good deals are very few and far between and we dont know how long will it take for the prices to return to more normal prices. And on the other hand there is a ton of fear about inflation.. I got a question, what do you think about buying, in the meanwhile, TIP bonds? So.. investors would have and edge against inflation up till opportunities can be found in stocks.. while staying "liquid" so to say.. I love your videos, thank you and Danielle for sharing your knowledge!
Hey Phil. Love your channel. I heard some conflicting messages in learnings from previous recessions, specifically around owning assets vs. holding cash. If I believe this is the start of what will be a down turn over the next 6 months at least, am I wrong to have cash awaiting to invest? I don't understand impact of inflation and power of currency well enough outside of an elementary understanding that those should lead to the face value of stocks going up. Curious your advice on the balance of having cash tied to an asset versus cash in hand during tumultuous times like these.
Excellent video Phil! I listen to your podcast as well so I get a well rounded investing knowledge source! It is as you said gotta buy wonderful companies that is within our circle of competence, with intrinsic characteristics that give it a durable competitive advantage, and preferably management with integrity. And most importantly must be within the margin of safety price. Good ol' Charlie Munger. I'm sitting this one out in cash whilst looking at the market now go up without me lol
Yahoo! was selling at 500x projected sales. They had no earnings so it was not possible to compute a PE ratio. It was insane unless you were Mark Cuban and his partners.
Great content as always Phil. I love your breakdown of historical crashes, really well done. I tend to agree with you on what's going to happen now. I feel the market is ignoring the downfalls on earnings from the 1st and 2nd quarters and are being irrational about how long it's going to take for things to normalize. Many quarterly reports paint a rosy picture for Q3 onwards but with things like Apple shutting down stores due to C19 breakouts, I think the market will be heavily let down for an extended period of time. I have no idea how long that will be, but probably a lot longer than people want to believe.
@LEO. Ray Dalio said we were in the 7th inning of the current economic cycle (longer term) in the fall of 2018. Phil just said we are in the first or second inning of the current market cycle, that is different but yes related. I haven’t heard Dalio relate the current 2020 market to baseball terms.
I am going to be patient. I have 30% invested but I haven't been investing. There's too much uncertainty in the economy. I don't trust the economy to recover quickly. This virus will have lasting effects on the economy. I have a few positions related to tourism. Having a tough time selling them at a loss. Going to wait it out. But I am not in a hurry to buy.
Very well thought out and explained economic situation. Makes me want to time the market, but that probably won’t work out well. I would think Biden will win, so if you are right the next 12 months is a good time to have cash available.
The market will continue to be volatile until we see some concrete decrease in the effect of covid 19 in the country as a whole. As a healthcare worker I see the rise and fall of people presenting to the ED with symptoms. It has not leveled... Hospitals are laying off people.. That is something I did not think in my 35 years of nursing I would see. I think unemployment will drive this until the virus is under control and with the other issues that effected our economy prior, I am bracing for a hard recession, or mild depression.
Hi Phil. Greetings from Denmark. Found your Channel a few weeks ago. Great content you make. Would love to see a video from you about how you became a succesful investor. What kind of work did you do before ?
I had been patiently waiting for 3 years since 2017 for market to crash and it bounced back before I could even position by myself. Wonderful. Might as well never invest again
The stock market should go down massively from current levels. However, the FED will probably buy everything, making the DJIA and average home prices increase two fold from current levels. Zombie and bankrupt companies will be the best performing assets. Simultaneously, the country will have historic levels of unemployment, and the individuals who have jobs will have their wages cut. The FED and the President will tell us we have the best economy ever! With that said, I'm continuing to increase my cash allocation.
The stock market should go down in July or August, and then in october, and then in Jan Feb next year. Whenever the quarterly or annual financial reports come, the markets will go down.
Hi Phil, I having been reading and making small studies onto previous crashes ..jus as u pointed . In all the above said cases , it had 2 or 3 rallies before it fell off , hit rock bottom . And then recovered ... But this time around I jus have 1 question. When all countries around the world with their fed s are pumping so much money ,---- >inflation -----> continue further pumping and interest rate decrease ---->how long can d fed s pump...??? Or they willing to decrease their value of currency ??? That's the big question I have ... Seniors like u havev 2 answer wat happened in the past ....
Ive been investing for about a year. Mostly companys like 3m, mcds, clorox, cat, apple, lmt, jpm, ect. Building a dividend portfolio full of big names in their fields. Everyone I know keeps telling me to get my money out of the market. It also seems like its all doom and gloom from all the "experts", who are also basically saying the same.......... Im trying to build up playing the long game, but hearing people use words like "depression coming" and not even getting back to break even for 30 yrs is kinda a lot to digest. Curious about your take on it??
It's important to notice that the first big market crash was 1929. And then nothing for a while despite 1987, and then 2000,2008 and 2020. Why ? too much leverage in the system. If the fed succeeds to avoid now a depression, next time there will be one. Which generation will bear the brunt of all of this ?
My opinion. This drop will not be as severe as the first as we already have experienced the beneficiaries from these times (AMZN up 40% now that we see the urgency of online shopping during lockdown, JNJ, UNH div growing unscathed for income investors etc). But too many are buying with the hopes of getting in before the all time highs, whilst Q2+3 earnings are going to cause some concern. GDP is going to take a hit that does not recover within a month or two, Trade is slower (check CCTV at ports for lack of traffic, railways etc), we are only beginning to see which poorly ran companies will go bankrupt and falling amongst the cracks. The FED are the only reason for optimism. 30% Cash ready, slowly but surely DCA into the 2020 nightmare ! :)
Every time market be crashed it means one time for making the GREAT MONEY from the smart people who already have the money in hand and can really use to invest in. For many it will be terrible, but for some, it will be incredible
Phil I have a question.. I invested some money around April when the economy crashed because some stocks that I had invested in went down. I bought them and afterwards they went down a lot more.. fast forward to today they are up enough so that I turned a profit. In addition, I also have a chunk of cash that I want to invest with. Should I sell the stocks that I bought in April and wait for the economy to crash to reinvest it since right now I’ve made a profit ?
Keep it because no one really knows whether there'll be a crash or not. If you sell it and the market keeps on going up then you would've missed one of the greatest bull markets in many years. I'd also say the classic saying: 'time in the market is better than timing the market'
@@claudioc6581 But how high can the market really go before it crashes again. The world is a mess. I'd tread carefully as the market is back to pre virus levels but now we have massive unemployment, bankruptcies, social unrest, international battles
@@coasteyscoasteys That's the thing, no one really knows and no one can't really time the market. But if you bought stocks at a price below their underlying value then that shouldn't matter at all because in the very long term (10 years at least) you know that the economy will thrive again. The difference of opinions between individuals (like you and me) is what brings misprices of the stocks and that's where opportunities can be found.
Hi Phil, excellent video as always!! What do you recommend for those of us who invested during the lows of March? I didn't expect that fast recovery, but it has become so overvalued again and was just wondering if it should be better to be again in cash, what do you think?
Would like to hear the opinion as well. Feels like continuing to hold would be a safe bet, to maintain good averages, but it may be worth taking the opportunity to lock in gains and wait for a downturn to buy in bigger. ~50% up in my portfolio
He talked about this recently (podcast?FB?). If he was in, he was staying in. But each person's situation is different. I kind of wish I took some profits, but if you believe in the company, you believe in the company. Keep checking to see if the company's story changed: More debt? Moat no longer durable? CEO not managing capital? Update your research and decide from there.
Take the profits out. Invest them in gold etf. If the market, drops, gold should go up and you still hold the stock, get the dividends, but less exposed. If the market sustains for a long time (1yr) then re buy the stocks you sold or identify new ones.
The disconnect will be resolved. Either profits will moonshot or the markets going to correct. It’s a weighing machine over time. Even the last hope tech companies are not immune
I just listened to the podcast ep yesterday about FDR banning buying of gold and Danielle didn’t believe it was true lol. They sure don’t teach things like that in history class.
@@lazerhawk2192 The government physically cannot take bitcoin away from the individuals... They can do that on gold however I don't see that coming since dollar isn't on gold standard anymore and they don't need gold to print money. If they do plan to confiscate gold, we are in a much bigger problem, talking about the fall of the modern monetary system and the fall of the US.
2:32 sorry to correct you but Ben Graham didn't make "tremendous fortune all through the Depression" . He has actually lost most of his wealth in the 1929-1932. He has lost 70% of funds vs Dow’s 80% loss and recovered only by 1935. His loss were super heavy as he, like many others, used debt to purchase stocks and fuel his earlier growth. He carried 44% margin debt on his fund. He changed his approach AFTER enormous loses of early 30s. Now back to the subject - I think we are going to see SP500 at 1500 or even lower. I know it sounds like absurd to some and sometimes I doubt it looking at what FED is doing, but in the long run all must have come to the mean. Simply, must and will. It may not crash in next 2 years that far and low, but it will and the longer it takes the more painful it will be. We have no real corporate earnings growth since 2016, EPS were "growing" thanks to massive buybacks in the past, fueled often by debt. And Market Cap to GDP, famous "Warren Buffet indicator" is at ca.150 %! Highest in history, comparable only to 2000 bubble. Third - thanks for the summary of subprime crisis and the reasons behind it. People blame banks but in reality, banks were ... doing money because they COULD. Can you blame a child, when parents are gone and it is left with 2 kg of chocolate on its own? Bankers are humans, greed, bonuses, they did it because they were allowed to. I know they must take part of the blame, but it is mainly the State behind the mess. If government did not allow and encourage for these loans, all based on political reasons, did not lower rates to sick low levels, it would not happen. It is just the goverment behind almost every crisis. Thanks for the video, much appreciated.
Thanks for the Video! The current market makes me wonder if we are like frogs swimming in water that is slowly heating up. When do we jump before the water starts boiling?
If you're day trading and trading on the open you could make a ton. But definitely have to research your long term portfolio stocks and make sure they didn't have any debt prior, and qualify as a COVID and reopening stock
Good video. Thanks Phil. I think you're right. I agree that the fallout from Covid-19 is far from over. We have only begun to see the effect on earnings and unemployment is still rising or at least staying steady. Personal savings rate is historically high right now and consumer spending (especially among higher income earners is down). This will stifle a true recovery. That said, the stock market will follow. There is no good reason in my opinion why it has rallied so much since Mid-March except the reported massive influx of retail capital into the market. I have a feeling that will not sustain it's growth however, and I'm pretty sure we are at the tipping point as of now. My prediction is that it will start down now until the election and only begin a true recovery if Republicans get elected, we get our Covid-19 reactions under control, and let people get back to work. I doubled down on my short positions yesterday.
The market will come down again this year. Probably not to the lows of march but significantly enough to bring the prices of those stocks of quality companies to a more reasonable level. Sure, there is TINA but the race has to end at some point. It just has to.
While I don’t know what will happen, I’ve been diligently working on my cash position. Granted, my portfolio is small, but I,m hoping to around 50% cash by early July. At that point I will closely follow earnings and we”ll go from there.
Just extremely volitile. I think there's a lot of money to be made short term, and long term if you're smart about it. But there's also a lot of people investing in bankrupt companies and not doing their research, which could ultimately cost them hundreds if not thousands.
You've made a watchlist with good businesses that are well managed and protected by their own moats. It rained gold and if you haven't gone out with your bucket in late March, you missed some good opportunities when those businesses went on sale. And now Phil is telling you not to jump in?
Once the 600 weekly cash n prize unemployment goes away that’s gonna be the start of the crash. I know so many people living it up right now making way more money off unemployment then they did at their crappy job. Pisses me off... meanwhile I haven’t got shit for help and yet I’m still trying to run my small car dealership solo. Still sending the state their huge quarterly sales taxes from my dealership yet I can’t get shit in return. Thanks a lot govt lol.
What do you predict will happen with the current stock market crash? Leave a comment below.
Download my FREE Stock Market Crash Guide and learn how to navigate your way through this volatile market: bit.ly/3hyJyDL
Hopefully, it will die quickly, allowing rational investors to get busy.
Was the early monetary tightening (rate increases) caused by the then-in-use gold standard and outflows of gold from US banks to foreign banks?
Thanks good video. Hold on we are in a bumpy ride. At least the US dollar is strong so those that have cash can recapitalise at a strong currency level. Here in BRICS we are not so lucky! Our software, tech and vehicle prices have skyrocketed!
I think at some point the US will enter another war and that's how they'll recover the economy
Paul Krugman ~ 2002 "Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble." Sure Paul. Sure. Subprime, No Income/Assets (NINA) for million dollar homes... what could go wrong?
Price-fixing the cost of debt does not work.
of all the investing channels here on youtube I feel like Phil is one of the few who truly knows what he's talking about
omfgSHORYUKEN most are BS millenials with about 6-12 months of experience
Experience is knowledge
💯!!
95% are beginners it feels like. Hyperbally speaking everyone allways just tells you the pe ratio and some odd reason for being bullish. And it seams like 1/4th are All-In tesla channels
Agree..his advise is also the one that makes the most sense
Thanks for sharing all your HELPFUL videos.
I was born in New Jersey 1997 and after 2008 hit..unfortunately I saw how my parents lost their jobs, the house, and all 3 new cars...now bankrupt all to impress “friends & family”.
Man was it rough, but we ended up moving to Charlotte, NC and yet again they still haven’t learned their lesson..”close minded” and struggling, waiting for the government to help them survive.
At the age of 20 I left and moved to Houston,Texas alone.. falling into drugs, alcohol, and homeless for a whole year. Chasing fame & friends with the money I did not have!
Today I’m 23, a couple months ago I finally freed myself after meeting a mentor, reading for the first time in years and deleting all my social media platforms that I had thousands following. Becoming financially literate and choosing MY LIFE over material things before falling into the “RAT RACE”. I’m stronger, healthier, and now wiser for my generation someday! Once you see how beautiful life is you start to enjoy it without a care the world.
I PRAY THAT WE BECOME LEADERS & TEACH OTHERS WHAT THEY CANNOT SEE 💯
Thanks to Rule 1, I’ve bought every day throughout this crash. As a result I’m beating the S&P by almost 5%. Thanks Phil.
Exactly,
I agree! That the stock market seems overvalued. The protesting is going to hinder reopening and be a catalyst for the spread of the virus. Timing the market is extremely difficult if even possible. The trick is to diversify your investments, don’t panic when everyone else is and invest consistently.
My humble opinion is that we are facing a period of time like the Great Depression. We are now in the beginning of the Bear Market and it will take a year or two until we see the bottom. There were huge rallies during the 1929 crash all the way through 1930 to 1931. Be careful out there and stay healthy!
yes it is, but the market can only go lower before going back up right? then I am on the right track by investing rn, although I am inexperienced, i am learning fast
@@jeffreymurphy5302
I wonder what are the best opportunities to invest now are, there are opinions but a little later I find out these opinions dont matter as a totally different turn of events play out with the stocks they discussed therein
@@amiracentenososa3847 I'm in the buy, although there is a great bear market I am investing every two weeks because I am seeing improvements in my portfolio, dividends look certain. No short cuts trading online, It might be worth reaching out to some of an highly skilled impartial investment advisor to assist in you. Fortunately, I have owned 2homes in the United states and car dealership all with the an investment capital of $150,000
@@larryagostosanabria1515
I need an impartial investment advisor, I know they are there I dont just know...how can I reach out???
Hey Phil, I am mostly in cash right now and the FOMO sometimes is killing me but watching your videos helps me a lot to keep on track and stick to my plan. Thanks for doing this!
Hey Phil ! It's Sohit from India (Delhi). I am an avid viewer of your videos for they are so informative. I have gone through the 2008 crash and felt it. You are absolutely right that this covid crash will also have many layers. It's so good to get so much knowledge from an experienced & veteran like you.
Lots of love
Regards
Sohit Sharma
Delhi(India)
Stay in India.
I needed to hear this. Just sold out of a not so great real estate deal and am sitting in $160k ($AUD) cash thinking what the hell to do now. Never held stocks before, but feel it's better than real estate. Taking my time is the lesson I'm taking from this. Thanks Phil!
Why would you tell everybody you have so much cash I dont get that
@@crcr3461
What they gonna do to him
Phil your videos are easy to digest, informative and entertaining as well. Keep them coming!
What will happen next: We cannot forecast a tight enough range for S&P future earnings. How can we forecast our return with any degree of certainty? The range of possibilities is too large (e.g. a vaccine may come early 2021, but not surprising if we never have an effective vaccine either).
What we do know is current valuations (S&P @ 3100-3200) would be reasonable if COVID never occurred and S&P500 earnings around $160/share (even then arguably overpriced). Thus current market prices are ridiculously high, simply put.
I believe another large winded drop will come: employment remains stubbornly low, retail continues to suffer and bankruptcies start making their way through the system, indirect effects begin materializing (e.g. bankrupt restaurant owner won't buy newest Apple product, cancel subscriptions, etc.), yield seeking out of bond market slows down, helicopter money program ends and people have to actually withdraw some of their investments.
been red since March and it bothered the crap out of me but now I feel much better about it. now that you pointed out how long the recession hurt the market. I will keep buying shares and look the other way at my 3-month chart only been playing the market for 3 years so still learning and researching.
Your videos on education & investing is very informative. Good work!
Thank you for watching! I'm glad you find them useful.
Town made a nice call to exit equities in his August 2007 appearance on CNBC. He was on about ten days after Jim Cramer threw that on-air temper tantrum in the studio with Erin Burnett, insisting of Bernanke that “he knows nothing!”. Legendary appearances on both fronts.
Thank you Phil I feel like you are my conscious advising me in the back of my head, I really value all your teachings.
I believe leases and office spaces will reduce for businesses. Most not all businesses will close as the remainder adapted to teleworking, causing less office space to be used or needed. With Amazon buying malls and JC penny's/Sears makes the most sense. Those office building will most likely turn into condos and new enterprises that I got thinking when I seen a documentary about Singapore.
Thanks for the video, Phil. From here, I think no one will know. The market can always go either way. What I like to do is stress test my portfolio and position myself to be comfortable if the worse happens based on my risk-tolerance. If the stock market declined 50%, I already have an idea of how my balance would look like, but I’d be okay with it because my positions are in companies that have already survived the test of time, and those I can’t see going away. Moreover, they pay dividends so I’ll just buy and hold. If the market does go down 50%, I’ll just add even more to those great positions - again, based on my own risk
tolerance.
These kind of videos/analysis are the #1 best. Thank you !
The Fed will start daytrading in the Robinhood app soon. So kinda difficult to predict the short term direction.
Lol probably
The FOMC can’t raise interest rates, but the higher rates of junk bonds are on the shopping list for Fed asset purchases.
lol
Yeah. With the rate of market growth. It would be totally impossible for a crash
Hahahaha.. The fed probably saw the green light.
This was a great history lesson. Thank you!
Very helpful Phil! These days it feels as though the market will never come down in relation to where the economy is at.......until it does!
Thanks Phil for showing the historical evidences during the great depressions. I feel , if the US-China trade relations do not go wild down the line,i am sure global economy recovers at least to the 50% to 60% of pre-covid levels by mid/late 2021. Other major geo-political triggers like "global climate change summit", "brexit" , "decentralizing supply chains","refugee issues" will add fuel to the recovery if properly handled as otherwise the recovery seems tougher and more challenging for the global citizens.
This video was very helpful to me to understand the history. Thank you. keep the videos coming. I need the education.
Thanks Phil, great to hear from people who understand the stock market at a very high level.
Thanks Phil. I follow few guys with different view on the market . This helps me build an emotionless/ informed decision.
Your analysis helps me to rethink and evaluate risks . it balances my greed with rational and patience.
Phil, I would like to personally thank you for the investing gems that you share in plain speak. Always spot on. Keep sharing those insights. I am a reasonably successful individual investor myself thanks to people like you 🙏🏼
is this still good time to buy stocks on sale or its too late as they going up?
Thanks for your education, Phil. Much appreciated. I believe it will go down by 30-40% primarily driven by job loss, loss of manufacuring demand, and over leverage of consumers that continues regardless of reduced income. Many people that lost their jobs are still able to get massive loans which is totally irrational. My neighbourhood has driveways filled with 200k+ worth of vehicles. it's just a matter of when.
I believe we will get a clear idea after getting the next quarter reports of companies.
Because it's the performance of the companies which will drive the stock market in either direction not the instinct.
Thanks for the lesson in history Phill. Hopefully the market can recover from this recent crash in a shorter time period compared to the past. I don't think we will have another dip as big as March 2020, but the market will definitely take time to fully recover. I missed a few sales in March, but I think there are still some some great companies still on sale way below their sticker price. There is still time to invest.
Hi Phil, is now a bad time to buy a property near Seattle to be utilized for rental? As you said, the lesson from 1930s crash is to buy assets producing cash flow.
Very good presentation and a very good recap. I think the stock market will go down again when the quarterly results start coming out. How much it will go down further is anybody's guess.
It is true that the current US stock market levels look insane when considering the state of the economy. However, the stock market is an average: many companies (especially in the tech sector) have seen their stock price skyrocketing, while some other cyclical stocks (especially in European markets) are still at record lows, even though they have sound balance sheets, are paying dividends that they can afford, and likely are well positioned to make it through the crisis. I am thinking of stocks in the banking, insurance, construction industry (for example BNP Paribas, Zurich insurance etc.). It seems that several good companies are being penalized in an exaggerated way. Would you keep your “wait and see” advice for all stocks, including these ?
Thank you Phil! What I don't like are these "investors" or "traders" that are springing up everywhere now. Maybe it's because I've been getting into your books and videos that I'm being targeted by ads. But I attended one webinar on Forex trading just to see what this guy was all about. I can tell from his accent that he's from the same area that I'm from in England, so I wanted to give him a chance at least. It was purely gambling! His webinar had fake chatting people saying how keen they are. He was boasting that his trading application has automated rules and macros that watch the market and get in and out at the right times for you. Pure gambling. Then there was another webinar I attended because Robert Kiyosaki was supposed to be speaking there - pure lies. I am grateful that I can see through most BS but I dislike how many people will be duped. It pains me a lot.
Am I the only one who press LIKE button before the video even starts? Great job as usual, Phil!
Matteo G nope
Great video! Thanks!
Informative video. Thanks for sharing Phil. I agree, we need to own cash producing assets. I tend to prefer cash flowing income property.. Lots of tax advantages with being a landlord. Of course, it comes with its down sides but long term, i would say it is a good investment to retain your wealth.
Loving these history lessons from your wood-panelled office!!!
Thanks for the timely information Phil Town.
You explained the house bubble of ‘07 accurately but then called it a market failure... that was not a failure of free markets - as you described, it was the result of massive government intervention into the housing sector creating perverse incentives for banks
Edit: great video though providing a long term outlook
Paul Krugman ~ 2002 "Alan Greenspan needs to create a housing bubble to replace the Nasdaq bubble."
That bubble was blown up for years... around 2002 to 2003, the fed dropped rates drastically and the phones never stopped ringing for banks until rates were yo-yo'd back up to over 5% around 2007.. it isn't quantum physics to understand that housing values would plummet after that... that's when the propaganda started.. that the problem was "greeeed" and other nonsensical and uneconomic explanations... couldn't possibly be someone price-fixing the cost of debt and yo-yoing it all over the place.
Oh, and get this.. the way it was suggested to fix it, was to lower the rates back down to effectively zero (.25%) again... for 10 years. lol. Alas, the economy was saved. Glorious.
KendrickJ2 exactly right - and more of the same Fed antics in this 2020 crisis, drop rates, print print print, and declare the recession cancelled!
Totally agree. Few people get this.
The Big Short had a little different take on the housing bubble. It was primarily a ratings agency failure and a derivatives bond failure that caused the collapse of the big investment banks which required a government bailout. If the bonds weren't all falsely rated as AAA then the loans wouldn't have been as easy to originate and other stopgaps would have limited the riskiest loans which caused massive defaults. It was mismanagement by the private sector that caused the spiralling collapse, which is why FNMA and FMCC had to be placed under government conservatorship.
Make sure to use sun screen Phil.
Yes, sunscreen. You may already have actinic keratosis. Get checked out by a dermatologist.
Be great for you to compare situation to Nikei in 85 as well and why still down 50% from high in 85 and compare to current admin policies tku
Awesome video! It's true the impetus for the bubble changes but the psychological principles behind the creation and destruction of bubbles stays the same. It's pretty amazing the difference in the PE in 1929 versus now. I loved the historical perspective you gave in this video.
Absolutely. Thank you for watching. 👍🏼
How is this the end of bull market when we are hitting all time highs? So basically you had a month where we crashed and had to figure out when to get in.
Who crashes the market and who stops the crash? Isnt it all the huge funds and banks? Average investors just follow them when they sell off or buy a lot.
Hi Phil! Since there's a bubble-like scenario in the stock market and opportunities for good deals are very few and far between and we dont know how long will it take for the prices to return to more normal prices. And on the other hand there is a ton of fear about inflation.. I got a question, what do you think about buying, in the meanwhile, TIP bonds? So.. investors would have and edge against inflation up till opportunities can be found in stocks.. while staying "liquid" so to say.. I love your videos, thank you and Danielle for sharing your knowledge!
Very interesting recap Phil. Thanks!
Great video Phil thank you for sharing your knowledge!
seems like there is quite a bit of correlation with oil prices also? your thoughts?
Thanks for the content and dividing the video timeline by topic, super helpful!
Hey Phil. Love your channel. I heard some conflicting messages in learnings from previous recessions, specifically around owning assets vs. holding cash.
If I believe this is the start of what will be a down turn over the next 6 months at least, am I wrong to have cash awaiting to invest? I don't understand impact of inflation and power of currency well enough outside of an elementary understanding that those should lead to the face value of stocks going up. Curious your advice on the balance of having cash tied to an asset versus cash in hand during tumultuous times like these.
*It's a great time to make money.* 👍
Absolutely. 👍🏼
nice video. Though economy doesn't look sounds other than few companies but this market has run like hell. Have some cash and stay invested.
Excellent video Phil! I listen to your podcast as well so I get a well rounded investing knowledge source! It is as you said gotta buy wonderful companies that is within our circle of competence, with intrinsic characteristics that give it a durable competitive advantage, and preferably management with integrity. And most importantly must be within the margin of safety price. Good ol' Charlie Munger.
I'm sitting this one out in cash whilst looking at the market now go up without me lol
Appreciate your video! I needed to hear this. Glad I clicked
I like the perspective reset, thanks Phil,
Yahoo! was selling at 500x projected sales. They had no earnings so it was not possible to compute a PE ratio. It was insane unless you were Mark Cuban and his partners.
Great content as always Phil. I love your breakdown of historical crashes, really well done. I tend to agree with you on what's going to happen now. I feel the market is ignoring the downfalls on earnings from the 1st and 2nd quarters and are being irrational about how long it's going to take for things to normalize. Many quarterly reports paint a rosy picture for Q3 onwards but with things like Apple shutting down stores due to C19 breakouts, I think the market will be heavily let down for an extended period of time. I have no idea how long that will be, but probably a lot longer than people want to believe.
Taking your advice Phil. Saving my dimes ready to dive in to some good and very cheap stocks when everything crashes
“1st or 2nd inning of a 9 inning game”
So I wonder when is the 9th inning? 2022-23?
@@jk4794 ten years from now.
@LEO. Ray Dalio said we were in the 7th inning of the current economic cycle (longer term) in the fall of 2018. Phil just said we are in the first or second inning of the current market cycle, that is different but yes related. I haven’t heard Dalio relate the current 2020 market to baseball terms.
Thank you for sharing. I appreciate this comparison. We can predict the future from history.
I am going to be patient. I have 30% invested but I haven't been investing. There's too much uncertainty in the economy. I don't trust the economy to recover quickly. This virus will have lasting effects on the economy. I have a few positions related to tourism. Having a tough time selling them at a loss. Going to wait it out. But I am not in a hurry to buy.
Very well thought out and explained economic situation. Makes me want to time the market, but that probably won’t work out well. I would think Biden will win, so if you are right the next 12 months is a good time to have cash available.
The market will continue to be volatile until we see some concrete decrease in the effect of covid 19 in the country as a whole. As a healthcare worker I see the rise and fall of people presenting to the ED with symptoms. It has not leveled...
Hospitals are laying off people..
That is something I did not think in my 35 years of nursing I would see. I think unemployment will drive this until the virus is under control and with the other issues that effected our economy prior, I am bracing for a hard recession, or mild depression.
I am patient following your advice
Hi Phil. Greetings from Denmark. Found your Channel a few weeks ago. Great content you make. Would love to see a video from you about how you became a succesful investor. What kind of work did you do before ?
I had been patiently waiting for 3 years since 2017 for market to crash and it bounced back before I could even position by myself. Wonderful. Might as well never invest again
The stock market should go down massively from current levels. However, the FED will probably buy everything, making the DJIA and average home prices increase two fold from current levels. Zombie and bankrupt companies will be the best performing assets. Simultaneously, the country will have historic levels of unemployment, and the individuals who have jobs will have their wages cut. The FED and the President will tell us we have the best economy ever! With that said, I'm continuing to increase my cash allocation.
The stock market should go down in July or August, and then in october, and then in Jan Feb next year. Whenever the quarterly or annual financial reports come, the markets will go down.
Hi Phil,
I having been reading and making small studies onto previous crashes ..jus as u pointed . In all the above said cases , it had 2 or 3 rallies before it fell off , hit rock bottom . And then recovered ...
But this time around I jus have 1 question. When all countries around the world with their fed s are pumping so much money ,---- >inflation -----> continue further pumping and interest rate decrease ---->how long can d fed s pump...??? Or they willing to decrease their value of currency ??? That's the big question I have ... Seniors like u havev 2 answer wat happened in the past ....
Does the value change if they all do the same..?
Thanks 🙏🏻
Ive been investing for about a year. Mostly companys like 3m, mcds, clorox, cat, apple, lmt, jpm, ect. Building a dividend portfolio full of big names in their fields. Everyone I know keeps telling me to get my money out of the market. It also seems like its all doom and gloom from all the "experts", who are also basically saying the same.......... Im trying to build up playing the long game, but hearing people use words like "depression coming" and not even getting back to break even for 30 yrs is kinda a lot to digest. Curious about your take on it??
You’re absolutely correct Phil!!
It's important to notice that the first big market crash was 1929. And then nothing for a while despite 1987, and then 2000,2008 and 2020. Why ? too much leverage in the system. If the fed succeeds to avoid now a depression, next time there will be one. Which generation will bear the brunt of all of this ?
Good content Phil.
My opinion. This drop will not be as severe as the first as we already have experienced the beneficiaries from these times (AMZN up 40% now that we see the urgency of online shopping during lockdown, JNJ, UNH div growing unscathed for income investors etc). But too many are buying with the hopes of getting in before the all time highs, whilst Q2+3 earnings are going to cause some concern. GDP is going to take a hit that does not recover within a month or two, Trade is slower (check CCTV at ports for lack of traffic, railways etc), we are only beginning to see which poorly ran companies will go bankrupt and falling amongst the cracks. The FED are the only reason for optimism. 30% Cash ready, slowly but surely DCA into the 2020 nightmare ! :)
Every time market be crashed it means one time for making the GREAT MONEY from the smart people who already have the money in hand and can really use to invest in.
For many it will be terrible, but for some, it will be incredible
Thank you for your help!
Phil I have a question.. I invested some money around April when the economy crashed because some stocks that I had invested in went down. I bought them and afterwards they went down a lot more.. fast forward to today they are up enough so that I turned a profit. In addition, I also have a chunk of cash that I want to invest with. Should I sell the stocks that I bought in April and wait for the economy to crash to reinvest it since right now I’ve made a profit ?
Keep it because no one really knows whether there'll be a crash or not. If you sell it and the market keeps on going up then you would've missed one of the greatest bull markets in many years. I'd also say the classic saying: 'time in the market is better than timing the market'
Sell and take those profits. Better buying opportunities await.
@@claudioc6581
But how high can the market really go before it crashes again.
The world is a mess. I'd tread carefully as the market is back to pre virus levels but now we have massive unemployment, bankruptcies, social unrest, international battles
@@coasteyscoasteys That's the thing, no one really knows and no one can't really time the market. But if you bought stocks at a price below their underlying value then that shouldn't matter at all because in the very long term (10 years at least) you know that the economy will thrive again. The difference of opinions between individuals (like you and me) is what brings misprices of the stocks and that's where opportunities can be found.
Hi Phil, excellent video as always!! What do you recommend for those of us who invested during the lows of March? I didn't expect that fast recovery, but it has become so overvalued again and was just wondering if it should be better to be again in cash, what do you think?
Would like to hear the opinion as well. Feels like continuing to hold would be a safe bet, to maintain good averages, but it may be worth taking the opportunity to lock in gains and wait for a downturn to buy in bigger. ~50% up in my portfolio
He talked about this recently (podcast?FB?). If he was in, he was staying in. But each person's situation is different. I kind of wish I took some profits, but if you believe in the company, you believe in the company. Keep checking to see if the company's story changed: More debt? Moat no longer durable? CEO not managing capital? Update your research and decide from there.
Take the profits out. Invest them in gold etf. If the market, drops, gold should go up and you still hold the stock, get the dividends, but less exposed. If the market sustains for a long time (1yr) then re buy the stocks you sold or identify new ones.
What is your opinion on biib? Just went down. Good pe and eps.
The disconnect will be resolved. Either profits will moonshot or the markets going to correct. It’s a weighing machine over time. Even the last hope tech companies are not immune
Why japan bear market never ended ??
When the levy breaks (Led Zeppelin pun lol )
All the kings horses and all the kings men, cant put it back together again...
I just listened to the podcast ep yesterday about FDR banning buying of gold and Danielle didn’t believe it was true lol. They sure don’t teach things like that in history class.
@@lazerhawk2192 The government physically cannot take bitcoin away from the individuals... They can do that on gold however I don't see that coming since dollar isn't on gold standard anymore and they don't need gold to print money. If they do plan to confiscate gold, we are in a much bigger problem, talking about the fall of the modern monetary system and the fall of the US.
2:32 sorry to correct you but Ben Graham didn't make "tremendous fortune all through the Depression" . He has actually lost most of his wealth in the 1929-1932. He has lost 70% of funds vs Dow’s 80% loss and recovered only by 1935. His loss were super heavy as he, like many others, used debt to purchase stocks and fuel his earlier growth. He carried 44% margin debt on his fund. He changed his approach AFTER enormous loses of early 30s.
Now back to the subject - I think we are going to see SP500 at 1500 or even lower. I know it sounds like absurd to some and sometimes I doubt it looking at what FED is doing, but in the long run all must have come to the mean. Simply, must and will. It may not crash in next 2 years that far and low, but it will and the longer it takes the more painful it will be. We have no real corporate earnings growth since 2016, EPS were "growing" thanks to massive buybacks in the past, fueled often by debt. And Market Cap to GDP, famous "Warren Buffet indicator" is at ca.150 %! Highest in history, comparable only to 2000 bubble. Third - thanks for the summary of subprime crisis and the reasons behind it. People blame banks but in reality, banks were ... doing money because they COULD. Can you blame a child, when parents are gone and it is left with 2 kg of chocolate on its own? Bankers are humans, greed, bonuses, they did it because they were allowed to. I know they must take part of the blame, but it is mainly the State behind the mess. If government did not allow and encourage for these loans, all based on political reasons, did not lower rates to sick low levels, it would not happen. It is just the goverment behind almost every crisis.
Thanks for the video, much appreciated.
Thanks for the Video! The current market makes me wonder if we are like frogs swimming in water that is slowly heating up. When do we jump before the water starts boiling?
Exelent video phil.
Mr Town is right guys, be careful where you put your money...
'This time is different ' they allways say before the stockmarked crash.
It's not bad to have some gold in your portfolio now.
If you're day trading and trading on the open you could make a ton. But definitely have to research your long term portfolio stocks and make sure they didn't have any debt prior, and qualify as a COVID and reopening stock
Great content! And here comes people who always say "but this time is different"! LOL
Good video. Thanks Phil. I think you're right. I agree that the fallout from Covid-19 is far from over. We have only begun to see the effect on earnings and unemployment is still rising or at least staying steady. Personal savings rate is historically high right now and consumer spending (especially among higher income earners is down). This will stifle a true recovery. That said, the stock market will follow. There is no good reason in my opinion why it has rallied so much since Mid-March except the reported massive influx of retail capital into the market. I have a feeling that will not sustain it's growth however, and I'm pretty sure we are at the tipping point as of now. My prediction is that it will start down now until the election and only begin a true recovery if Republicans get elected, we get our Covid-19 reactions under control, and let people get back to work. I doubled down on my short positions yesterday.
The market will come down again this year. Probably not to the lows of march but significantly enough to bring the prices of those stocks of quality companies to a more reasonable level. Sure, there is TINA but the race has to end at some point. It just has to.
no god damn clue what happens next, im just doing the usual 50/50 cash/stocks
I see it exactly that way!
It will go down then back upward... just like it has been for years.... and down again and back up again
It’s not how a modern crush looks like . It’s how a manipulated crush looks like !
While I don’t know what will happen, I’ve been diligently working on my cash position. Granted, my portfolio is small, but I,m hoping to around 50% cash by early July. At that point I will closely follow earnings and we”ll go from there.
Just extremely volitile. I think there's a lot of money to be made short term, and long term if you're smart about it. But there's also a lot of people investing in bankrupt companies and not doing their research, which could ultimately cost them hundreds if not thousands.
100s? Thats not too bad! how about hundreds of thousands
@@williamlee7119 lol you clearly get the point I was making 🤷🏻♀️ & yes that applies to ....
Tks for sharin
Thank you for watching!
You've made a watchlist with good businesses that are well managed and protected by their own moats. It rained gold and if you haven't gone out with your bucket in late March, you missed some good opportunities when those businesses went on sale.
And now Phil is telling you not to jump in?
Once the 600 weekly cash n prize unemployment goes away that’s gonna be the start of the crash. I know so many people living it up right now making way more money off unemployment then they did at their crappy job. Pisses me off... meanwhile I haven’t got shit for help and yet I’m still trying to run my small car dealership solo. Still sending the state their huge quarterly sales taxes from my dealership yet I can’t get shit in return. Thanks a lot govt lol.