Will Bitcoin Cause a Stock Market Crash in 2018?!
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Today we discuss if Bitcoin and Cryptocurrencies could cause a stock market crash in 2018. Bitcoin and Crypto is hot right now along with the stock market but could it all crash in 2018!
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Will Bitcoin and other cryptocurrencies actually cause a stock market crash in 2018? kryptos and the stock market are two very different markets. But will the crypto category actually effect the stock market and cause the stock market to crash in 2018 there are some reasons why you need to worry.
But there are also some reasons why you need to be excited whether you were in either market and I’ve spent a lot of time kind of thinking about the way I want to do this video so I can explain it best on the effects these markets will have on each other throughout 2018.
So the first thing we’re going to get into the first thing you got to understand when when you’re talking about any type of market, whether you’re talking about trading cryptocurrencies, we’re talking about trading stocks, real estate, whether you’re talking about trading freaking Pokemon cards, okay, there are buyers and there are sellers, okay, you got a category of buyers and sellers.
Now, prices can get out of whack when you have too many of each category. So the perfect situation in most markets is you got five buyers and you got five sellers. Okay, so everyone that’s looking to to buy something, they have the equal amount of sellers on the other side, that will create prices that are very, very stable, okay, when you have the equal amount you have prices that are very, very stable.
Things don’t get too out of whack. Now where you have issues is when you don’t have enough sellers and you have too many buyers so let’s say we got only two sellers and for every two sellers we actually now have eight buyers Okay, we now have eight buyers, this creates a situation where prices are going to go up dramatically Okay.
Prices will go up dramatically because there’s hardly anybody willing to sell but there’s a massive amount of people willing to buy so this is a creation where the you know, prices just rise in a very rapid rapid pace. You know, think about a stock sometimes when a stock is really hot like an.
Nvidia stock there are very few people that are actually willing to sell that and they want to hold it long term you got a massive amount of people coming in to buy it and what happens with the stock price it goes up 1,000% in three years guys Now on the flip side if you have too few buyers so now somebody’s got only.
Two buyers for every eight sellers what happens in a situation like this also now we have prices drop dramatically okay because now you know we got all these people willing to sell so they’re going to sell at whatever price they need to the buyers know that the sellers are in a position of weakness, they want to take advantage of that and get prices as low as possible.
So that is the marketing that’s like the market one a one on how you know prices work and supply and demand. It’s what it is for everything out there. Okay guys. So now that we understand that, let’s talk about crypto category for a second.
Okay, the crypto category is the hottest investing category I’ve ever seen by far in my lifetime. How do I judge the hottest investing category? Well, one is what’s going on with the price of what whatever it is the price obviously with kryptos is going up massively that means we have way more buyers currently then sellers correct.
Okay, next thing I like to look at is I like to look at like mainstream media, otherwise known as a double am okay, mainstream media, when I go on any type of financial site, whether it’s see CNBC, or any of these types of things, right? What are they talking about today?
Right now they’re talking about kryptos a massive amount on these also, they went from, you know, not talking about kryptos at all, where now they’re top viewed, you know, videos that are top news stories and whatnot, many times I have to do with kryptos right now, which means a massive amount of people are clicking on those, they’re very interested in those stories.
Okay, that’s another big thing. And I like to look at small things like YouTube, okay, I like to look at YouTube, what’s the interest? There are people that are starting crypto channels By the way, if you’re not starting a crypto channel, you know a lot about crypto cryptocurrencies.
Like you are missing out on the life lifetime changing opportunity for you right now. There are crypto channels that have started in the last couple months that are getting 100,000 views a video like that is ridiculous guys to be getting 100,000 like views of video and you just started you know a couple months ago that is absolutely insane there there are channels that have started that built to.
50,000 100,000 subscribers in such a quick amount of time which means there’s a massive amount of people demanding this type of content a massive it is absolutely massive. Okay, so the attention Okay, you got always think about Attention. Attention means money, okay, the more attention you get, the more money you can you can garner Kim Kardashian can make so much freaking money.
You know why she’s got the world’s attention at her at her whim, you know, Kylie Jenner whenever she can, you know, do something. She’s got that tension, okay, so she can sell products and something like that. crypto right now has the world’s attention.
People are massively flooding in there and as what situation we have crypto has the world’s attention. Now, next thing we got to understand here is we understand well in relation to the stock market, what type of stock market investors are out there, and how could this affect things? Right?
Well, as far as the stock market goes, You got a few different people in, in the stock market that have different goals, right? You have the long term holders, right? These are people that you know, invest in stocks for years and years, they put their money in, they don’t really care what happens their stock in the short term, there’s care what that stock price is at 510 15 years ago, or 15 years from now.
Okay, that’s what they care about their long term investors. Then after that, you have investors that are growth investors, okay? g for growth, these are ones that are looking for companies that are growing very fast, they’re growing revenues, very fast growing profits very fast, they’re getting more and more customers at a very rapid clip.
And these are growth companies. So these are growth investors, that’s the type of thing they’re looking for. After that, you have more short term traders, okay? These are people that are sometimes getting in stocks just for an earnings or something like that.
They’re getting in and out of positions within a couple of weeks time, maybe a month time, maybe a few months, there’s short term elder trades, or pretty much within a year, if not, within six months, three months type span, then you have a category of people in the stock market, which are called day traders, these people are getting in and out of stocks, sometimes several times per day.
Sometimes several times per hour, they’re just trying to get little price fluctuations here and there, take advantage of those sell out, buy back, things like that, guys, that’s another category. And then the last category you have in the stock market is what I call penny stock traders. Okay, these are Penny traders, where they just look for these penny stocks.
And a lot of penny stocks, unfortunately, are scams out there, I would say 98% plus of them are basically companies that you know, are shouldn’t even be listed on the market at all people invest in them, they don’t care about that company, or what the prospects are because there really aren’t any prospects for most these companies. They’re just little scam things and they’ll invest them try to get that price to go up.
And maybe you know, someone sends out a newsletter, hey, buy company ABC is going to go up this week, it’s only trading for a penny. Right now, it’s going to go up to 10 cents by the end of next week. Also a bunch of people in you know, buy into that penny stock, it goes up to 20 cents, the main one that originally bought the shares before when it was a penny, they get to sell out for huge profits, price goes back down.
It happens again. And again. It’s called pump and dump schemes. Okay, that happens a lot of times with penny stocks. Okay, so you got all these different investors? Now, when it comes to kryptos? Which type of investors are you going to lose into kryptos?
At least hope for the next like, a year or whatnot, long term investors, I don’t really see it, I don’t see you losing these people that you know, the money manager that’s got, you know, $80 million on, you know, his books and whatnot, I don’t see you really losing those ones at all. Okay, growth, investors also don’t really see you losing those ones, because generally, those ones have a ton of opportunity in the market.
Because there’s so many companies that are growing, I don’t really see those ones too much. Where I start to see a little bit is maybe around short term trading, you maybe start to lose a little bit of those, those ones that are looking to hold something for three months, six months and get out.
Also, I think even more so these ones day traders because they see cryptocurrencies, right. day traders don’t really care about companies, they’re investing, they’re not even investing. They’re trading these stocks because of price fluctuations. Okay.
So when they see cryptocurrencies have a lot more volatility in them than an actual stock, you know, cryptocurrencies they, you know, it’s pretty common, they got 510 15% in a day, and never mind that sometimes it’s 2030 40%. So a day trader looks at them, they say, what an opportunity for me, this is the type of volatility I need.
And I want a day trader loves that type of volatility, because they’re hoping to take advantage of all these big price fluctuations that happen day in and day out on these cryptocurrencies. Right. And then I also see you losing a massive amount of these people, Penny traders, okay, Penny traders, these ones don’t have much money.
Usually, they’re a very small thing. These people have, you know, maybe a couple 100 bucks. At the most, you don’t see people with 10s of 1000s or hundreds of 1000s of dollars, trading penny stocks, unless they’re that one that I’m talking about where they go big in a stock, send out a newsletter to an email list, buy this and then they do the pump and dump scheme where they sell out.
So but I do see you losing a lot of those type of people because they see kryptos as you know, when people are attracted to penny stocks, right, they’re usually beginners in the market, and they’re usually attracted by oh my gosh, stocks a penny right now, maybe someday can go to $100 a share and.
I can make myself rich from this magical penny stock almost like people view a lottery or something. I see a lot of those people’s looking at cryptocurrencies right now and seeing well ripples up you know, 15,000% or 20,000% in the past year, maybe I can find the next ripple in that let me get into cryptocurrencies and let me try to find the next ripple.
Well, bitcoins up over 1,000% if I can make my 100 bucks into 1000 bucks. That’s awesome. So I see you losing a massive amount of these guys. I see you losing quite a few of these day traders throughout 2018. I see you losing some short term traders, the good growth ones, the long term investors.
I don’t see you losing Much Money From there, but I do still see a you know, having an effect on the market. Okay. The The reason being is, I see possibly some of these people in some of these people, maybe funneling a little money into cryptocurrencies because it’s, you know, getting on the markets now is more mainstream.
There’s so much, you know, understood about these now and whatnot. So I could see maybe, you know, let’s say, this long term investor that, you know, makes massive amounts of money, let’s say they usually put a million dollars a month because they got money like that, maybe they put a million dollars a month towards stocks.
Maybe I’ll send now they start to put $900,000 towards stocks and $100,000 toward cryptocurrencies, maybe a few of them do that, which takes some money out of the market is not a huge amount. Now, something that would be asking yourself is why are these types of people, you know, not going to cryptocurrencies? Or why do they not do real estate?
Or why do they not go to this or that? You got to understand some people are just diehard into that category. For instance, there’s some people in crypto, right, there’s some people in crypto that have no interest in investing in anything else, they have no interest in investing in stocks, real estate, anything like that. Okay.
Same way, you have some real estate investors that have absolutely no interest in stocks, okay. I’ve talked to some real estate people before and like, dude, I’m killing your gains, you’re getting over there. And they’re like, Oh, no, I don’t want to get involved with the stock market, I could, you know, get involved with an Enron or something like that lose my money.
Stock Market is not for me, I’d rather just buy properties, rent them out, buy the next property and whatnot, you got to understand there’s some people that are just diehard, same thing with gold investors, silver investors, it doesn’t matter what’s going on in the stock market stock market could be a 6000 tomorrow, and it’s at what 25,000 right now.
It could be a 6000 tomorrow, and a gold investors and silver investors would still look at those patients that know, the stock market, I’m not getting involved with that. So you got to understand there’s a lot of people out there that just won’t go to that site, even if they think they might like it or something like that.
They just say no, no, I’m not touching that. Okay, so that’s something, you got to understand that. So you could be potentially losing some money from some of these people that are like, you know, maybe they want to diversify a little bit, and maybe get into some of these cryptocurrencies that are being taken more seriously, right.
Now, on the flip side, so these are kind of negative things. As far as the stock market goes, right now, the penny stock traders, those who don’t affect the market at all, you could lose 100% of those tomorrow, they do not even matter, they’re not affecting things, okay. And but at the same time, you do lose some volatility.
If you lose some of the traders and whatnot, and you lose some of the money. So these are kind of negative things for stock market, nothing still that I would see causing the stock market to crash or something like that, by itself. However, there’s also a positive from all this, right.
So there’s a huge positive in this for the stock market people out there. So people are making massive amounts of money in crypto right now, right? People are making massive amounts of money, people that have been in the currencies for a while some of them have become you know, people that are worth hundreds of 1000s dollars.
Some of them are worth millions, some of them are worth 10s of millions of net worth hundreds of millions of dollars from kryptos, they got involved with it, and they made a lot of money. Okay? Now, a lot of these people, you will remember I talked about making wealth and preserving wealth, two very, very different things, okay. When you’re making wealth, you’re just focused on the growth.
You don’t really care too much about the risk, whenever you got to do to make that wealth is whatever you got to do. Now, when people start when they’ve already made the wealth and they want to preserve it, what do they start thinking about? They start thinking about real estate portfolios buying properties.
Okay, they start thinking about diversifying in the stock market, maybe they’re not, you know, an individual stock investor like I am, but maybe they put their money in an index fund or something, because their main focus is is now once you get $1,000,000.10 billion dollars, $100 million. Now you can focus on if you just get 8% a year in the stock market, like the stock market goes up on average, right?
That’s freaking phenomenal. Tell me what 8% of $10 million is, that’s a lot of money guys in you’re taking very little risk because the stock market’s proven for the last 150 years, 200 years or whatever the stock market’s existed, right? And it’s had its downs, but ultimately, what does it do every single time it goes up over time.
Okay, it’s got 100 plus your track record, Real Estate’s got, you had way more than 100 year track record. So what you’re going to have is a situation where a lot of these people start to flood in these markets. How do I know this? Well, I get emails from people all the time asking me you know, to do like personal consultations and whatnot.
I had one person that made a lot of money in cryptocurrency, you want to pay me $200 an hour to teach them stock market and another person offered me $1,000 an hour which is like, I mean, my my time is valuable, but not even me. I’m not even worth $1,000 an hour and somebody that made a you know a lot of money that’s just put that way in cryptocurrency wanted to learn about the stock market and wanted to pay for it.
I’m not doing it. I know I call me stupid, whatever. I didn’t do it. But yeah, do you have a lot of people right now that are going to have made a lot of money in kryptos or Looking to get in some of these other categories that are, you know, safer in the grand scheme of things, you know, when Amazon and Google stock, the index funds and whatnot that just can kind of grow their money.
So that’s definitely a positive thing. You know, that guy, Charlie Lee, who started Litecoin? Because it’s so lit, right? He sold out of his position, I guess. 100% According to him, where do you think that money’s going? That guy Charlie Lee starts lead coin he sells out?
Where do you think that money’s going? You think it’s going under his mattress? Probably not you think is going in Bitcoin? Probably not you think it’s going, you know, you know, in the bank or something probably for the short term, I can almost guarantee you what his financial advisors are going to tell him gonna say, buy some real estate properties, stick a bunch of that money in the stock market in index funds, okay?
And they’re going to tell him, you know, keep a certain amount in your savings account, get some CDs, they’re gonna say, you know, get some money in a savings account, get some CD accounts, but you’re going to want to put the lion’s share probably in real estate in probably in stock market funds that track that index. Okay.
And what do you think he’s probably going to do, he’s probably going to listen, those people in do that guys. And that’s just the way it goes. When you when you actually get rich, and you’ve made your wealth and things like that, then you’re just looking to preserve, because it’s really painful if you’ve made $10 million, and that $10 million goes down to zero that’s like, beyond painful because it’s like $10 million is kind of hard to make out there guys.
So I hope you enjoyed this video. I don’t see it potentially causing a stock market crash. Of course, we’ve kind of talked in the past about if kryptos fell, could it affect the stock market and cause like a contagion situation where you know, bitcoin price and the cryptocurrency prices are falling, it could affect the stock market as far as causing a actual stock market crash.
I’m not convinced about it, but you have to you have to acknowledge the fact that these kryptos are going to have an effect on the stock market and the stock market will have an effect on kryptos overall guys in the situation so once again, I hope you enjoyed this hope you got a ton of value out of it hit a thumbs up if you enjoyed in the comment section.
I would love to hear your guy’s opinion on this whole situation. If you see it and potentially causing a stock market crash if you don’t see any effect at all. I would love for you guys to share an in depth comment down there. I love reading especially the in depth ones that kind of go into your opinion. I love reading those ones guys. Let me know what’s going on down there. Thank you for watching and have a great day.