Will a Stock Market Crash Happen Soon? // Stock crash coming, Stock market bubble explained, Hedging strategies, hedging explained, hedging with options, Stock market 101, stock market basics, stock market for beginners, stock market for dummies, stock market recession, stock market tips, stock market explained, stock investing tips, stock investing 101, stock investing for beginners, stock investing for dummies, stocks for beginners, stock crash coming, stock market investing tips, stock market investing strategies, stock market investing advice welcome to looking at the markets with David Moadel
today I'm going to show you something that I think is pretty important for any
trader investor or anybody was even just thinking about trading or investing in
the markets
today's title is this is what an overextended stock market looks like
good times
yeah you ever look at old footage from the roaring nineteen twenties or you
ever look at it you know
watch a documentary about that or read about the nineteen twenties and
especially 1929
yeah it was must have been an amazing time to be alive
must have been really great times lots of fun
probably seemed like the economy was just going to get better and better and
it probably at that time felt like the stock market was just going to go up and
up forever
there was no reason to believe that any you know anything but blue skies would
be ahead but we have the benefit of hindsight now
and with that 20-20 hindsight
well we all know how this ended up with with the good times also came the bad
times and this is a pretty well-known picture you
you might have seen it before you know it's it's indicative of what came
afterward a lot of pain in the Great Depression last for a long time and you
know cost a lot of suffering and misery
and yeah i'm i'm not necessarily saying this is what's going to happen to us
ok but you know you have to wonder is the euphoria that were feeling in the
stock market right now
how long is it going to last where is the leading to
yeah I'm not telling you to be bearish on the markets right now I would never
try to tell you how to feel or what to do but these are just things to think
about
I mean a lot of people are in stocks for a particular reason
there's nowhere else to go but stocks that's if you want to grow your money
I found a really good article today from the Washington Post online version and
here's a quote
things are so out of whack in the united states that putting ten thousand dollars
into a vanguard SNP index fund produces more annual income talking about
dividends then putting the money into a 10-year treasury security talking about
bonds here
the index fund would produce about two hundred eleven dollars a year of
dividends and that's the stock market according to vanguards website
compare that to bonds the 10-year Treasury would produce about one hundred
forty six dollars according to data from thomson reuters
that's pretty incredible you know these times we are living in putting your
money and 10-year treasuries or bonds actually yields lower than the dividends
from putting putting your money into the S&P 500
so bonds are not even really much of a safe haven anymore
you might as well just keep cash if you're going to do that and plus with a
10-year treasury your money is committed for for a decade and you're going to
lock in a very low rate so you know this is this can partially explain you know
why the market might keep going up
where else you going to go and you nowadays it's not the nineteen twenties
euphoria or and over extended stock market looks a little different now than
it did back in the the Roaring Twenties it it takes on it did a different form
euphoria looks different in the digital age and I collected some of today's
comments from a stock twits message board
you know people saying things like just keep buying you can't lose you know no
down days ever get in before you miss it you hear that a lot don't you
when that the market just keeps going up and up and up
it's FOMO fear of missing out
that's right fear can actually drive the market higher sounds crazy but it's true
bye-bye all-time highs every day it will never go down just keep by yeah when
people
it's one thing for people to say the markets won't go down
but never will go down or can't go down or no down days ever
that's a those are signs of an over a possibly overextended market in my
opinion
and if you pull back the PSP why the spiders
you know the S&P 500 index chart you can see I mean just take a look
you know it went up here and then crash and went up here
crash and now it's up here and it's starting to level off
yes it's hitting an all-time high now but I mean let me let me ask you this if
your if your parents or grandparents or somebody who's close to retirement age
asked you should I put all my all my money my entire nest egg
should I put it into the S&P 500 right here right now right here
would you advise them to do it knowing that they're wanting to retire soon
would you advise them to put it all in right here
it may be the answer is yes but for me the answer is No
at least if you're going to put it in you know don't just blindly put it in
don't just shove all your money into the markets and just leave it there because
you want to have a hedge the point the point of this whole presentation is is
not to roll your money up into a mattress and keep it there
it's to make sure that you're hedging somehow some way with every trade or
investment
ok if somebody did express the desire to put their money into the stock market
right now I'd say okay how are you hatching are you using small position
sizes with your trades or if you're going to put it all in are you heading
in some way and there are there are a number of ways to do that and I talked
about that in my other videos and you know I I can advise you on that but
please please don't just blindly put all your money and hope for the best
it's not the way to go in my opinion
so if you like some advisement on how best to protect your money
how to hedge if you need more help with anything in the markets investment
trading stocks anything like that options I can assist you
go ahead and feel free to contact me anytime my email address is David Modell
@ gmail.com thanks for listening I hope to hear from you soon