The Stock Market is Finally Falling! Do This Now!
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Well how about that!!The stock market is finally diving a bit! Stocks are finally going down! The Dow Jones industrial average, S&P 500 and Nasdaq are all finally going down! I want to share with you why the stock market is finally going down and what to do next with stocks. We are likely in a large recession right now with the economy very weak, but the stock market has been playing its own hopeful game… Lets see what happens now!
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Well, guys, today we got to talk about the stock market is falling oh my gosh, what do you know? What do you know? Oh my gosh, we got to talk about this guys, we got to talk about why the stock market is falling.
There’s actually quite a few reasons why the stock market is finally falling about two and a half 1000 points we’ve lost in the Dow just in the past couple of weeks. Why is this? It’s actually a few different things going on that will explain you guys what’s going on.
Not a lot of people know. Okay, and then we’re going to talk about what do you do now what to do now with your money out there. Okay. So here today, Dow Jones Industrial Average down 730 points. Oh, my goodness, it’s finally happening.
Okay, and then NASDAQ down two and a half percent, actually a little over two and a half percent. s&p 500 down 2.42%. And the rumor is that if I shaved my head, the stock market falls for every one hair follicle we shave out of my head.
That down goes one point, because I think that’s what happened. I mean, all sudden, you know, the shave the head that will drop 730 points. But no, in all seriousness, the markets been falling for the last couple weeks. Now.
Let’s be very clear about this. The market reached a top rate around I think it was June 9. Okay. Read around June 9, the Dow actually closed that day over 27,500 I think is 27,600. Somewhere real close to that and the stock market just seem to be getting way way too ahead of itself.
I mean, we got a lot of real uncertainty out there still that we have to work through for the remainder of this year right now. It’s just seemed like was just running to all time highs. NASDAQ was well over 10,000 s&p 500 was getting close to an all time high things are just running in here today we close out at rate about 25,000.
Almost exactly so we’ve lost you know about two and a half 1000 points if not a little over two and a half 1000 points off the Dow in literally just about a two week span. Look at the stocks today.
Everything’s down I mean Tesla, my Tesla, the FB took a huge downward move here today skyworks was down winning resorts was losing resorts today down over 6% CCL was down that’s kind of a normal day for CCL revolve was even down today and it was down as usual.
Okay, and so there was just a lot of stocks that were down. Okay, so once again, in this video here today, I want to get into why this is going on several different reasons. And what do you do now just so you guys know first link down there in description, I create a free video for you how to create a low risk high reward stock account and check out that first link in the description.
Don’t forget to smash that thumbs up button for the YouTube algorithm. Alright guys, so all of the following are part reasons why stocks are starting to fall all these matter. Okay, just a little bit for each one. Okay.
First one up here, Wall Street executives are bracing for potential Biden when as Trump fades in polls. So we know in some polls in you know, these polls, you never know, okay, you never know who’s going to actually win these elections.
In the end. You know, I remember the last election, right, they were saying, you know, certain individual was leading in the polls huge, it was gonna be an easy win, the other party ends up winning. So I would never put too much faith in these polls.
But Wall Street does like to look at them. And they’re looking at this. And they’re like, they’re a little afraid of Biden, mainly because there’s a lot of rumors that Biden could take corporate tax rates to 28%, or all the way back to where corporate taxes were just a few years ago, of 35%.
We know one of the changes the Trump administration made was obviously they lower corporate taxes to 21%. But I mean, he obviously if they go to 28%, or they go to go all the way back to 35%. That’s gonna hurt profitability of s&p 500 companies and quite a substantial way.
So it remains to be seen what happens there but Wall Street’s a little fearful when it comes to that. And that’s part of the reasons why the market has fallen recently, as more and more of these polls have come out, and a lot of them have Biden’s ahead, especially in a lot of the swing states recently.
Okay. Reason number two has to do with Rooney arona. Okay, the Rooney Rule. Let’s talk about Ronnie Brown. Now, this chart I’m showing you here is daily new cases around the world and look at it, it’s pretty much at an all time high.
And right now, the fact is Roni Rona is going just as strong as it ever has around the world worldwide latest spreading in mass still, and more than ever, let’s just put it that way. Like just flat out daily new cases, is literally looking at new cases every day.
And it’s just it’s an a massive, massive way. And then if we want to focus on just the United States for a moment, just you know, say let’s forget looking at worldwide numbers. The United States here today reached a number that was almost the record number ever for a day when it comes to Roni Rona. In the United States.
I mean, just look at how things have ticked back up as June has kind of gone along. right it’s just it’s a clear this isn’t a tick up day after day after day after day. And there’s a lot of fears that within like literally the next week, we could be at record numbers each and every day.
For cases I saw something like I think it was 9000 new cases of Roni Rona in Florida, I believe So the numbers are continuing to grow. There’s obviously a lot of worries from the stock market looking at these numbers, thinking, maybe we have to close on the economy, maybe things don’t open as strong as a lot of investors had hoped for.
We know the stock market has been running, like every, like Ronnie runner was just going to disappear. And everybody was just going to go out there and spend money like crazy. And now you when you look at these numbers, you start thinking to yourself, if you’re an individual in the stock market, you start thinking, Well, what happens if the stock I own closes?
Again? What happens if they can’t do business again, or what happens if this is elongated? Is the Fed gonna have to step in more, or we’re gonna have to get more unemployment breaks and things like that? This is a big, these are big questions.
And as we know, in July, July, what happens in July? Well, though, $600, extra payments from the federal government, go away for unemployment, a ton of people are collecting that $600 that goes away in July, a lot of questions on how things are going to shake out or people going to have jobs, when that was unemployment, extra benefits run out.
These are big questions. And these are real things. And when you look at Ronnie, Ronnie, just continue to go up, you have to really think about this. I mean, think about how many jobs just come from, let’s say, one football stadium during the fall time.
I mean, imagine how many people are employed just by that football stadium. Okay, and just think about if there’s no like football this season, I’m just giving you one very specific example. But just think about the 1000s of jobs from now one Stadium, right.
And you think about that across the country. But then you think about concert and you think about so many different things that we just don’t have right now. And we may not have total at least 2021 and it kind of makes you think, dang you know, these numbers are kind of important valuations. Number three, okay. valuations.
I’ve been talking about this for a while. This is another reason why I believe the stock market’s falling. A lot of investors are looking at this chart here. I’m showing you this shows you four p, the s&p 500.
And what do you see here? Okay, as of just a few days ago, literally, we’re at record highs of any time in modern history for for Pease, and it’s starting to fall, it’s it hasn’t, you know, begun to get back to normalize levels, but we’re starting to fall, we’re starting to get closer.
So that is that is actually some good news. But when you’re thinking about it, from an investor standpoint, a lot of investors haven’t want to put buying pressure on the market, because they’re just looking at it, like, a lot of these stocks are overvalued.
And that’s the same exact way I felt recently, you know, I’ve started to play a little bit of money in the market here today. And I’ll deploy more if this market continues to fall. But as of recently, like, I’ve just honestly felt like the markets overvalued, like there’s too much good news baked in, it’s hard to find deals.
And that’s how a lot of investors it’s not like I’m holding an investor that feels that way, believe me, it’s the masses, the masses that have been in this market for a long time, really understand how to value companies on a high level, everybody, pretty much, you know, figures like stocks have been overvalued, and they’re due to come down.
And we’re starting to get that because there’s just more selling pressure than buying pressure, a lot of people saying let’s take some profits, and let’s cash out some some of these stocks that have pushed the market up big time.
Okay, so it’s good news that’s starting to fall. Number four reason why the stock market starting to fall, this is more of a confusing one to some because they’ve never really heard of this. But there’s a basically a planned sell off.
That’s kind of like going on right now, I think actively and could continue into at least the next week. And basically, it has to do with pension funds, big investment funds, in general stocks have performed so well, that a lot of these funds have to sell off portions of stocks, and put that money into bonds, essentially, bonds have underperformed stocks have over performed.
And when it comes to a lot of these funds, are supposed to have specific amounts of money in each some of them are like a 5050 50% of the money is in stocks and 50% of the money is in bonds and stocks have been going up and up and up, then essentially your fun begins to get to stock heavy.
And what do you have to do you have to go ahead and sell off some stocks, put some of that money into bonds, so then you’re more even Okay, and so it’s not like necessarily these funds are like let’s go out and purposely trying to take profits on stocks.
It’s just literally like, if that’s what the fund is supposed to do. And they supposed to be 5050. They got to be 5050. Or let’s say they’re 70 stocks, 30% bonds, but stocks have grown so much because stocks have gone up, it’s now at 20.
They have to sell off some stocks, put that money over into bonds. This is something that goes on in the stock market. And this is why it is something in my opinion that helps the stock market keep more realistic valuations because these big funds, they do have to sell out and cause some selling pressure on stocks, it brings valuations down.
I’m actually in favor of it. I actually love it. Okay, so those are the main reasons why the stock market is falling on there. We just covered it. Okay. So next question up here. What do you do now? What should you be doing with your money?
Now in my personal opinion, okay. Number one, you really got to think about taking some if you own any of these type of super speculative companies. I’ve seen their stock prices go crazy. You got to really consider selling some of these stocks and taking profits.
You know, I think I think this is one of the stocks that’s up there. We’re going to mention a few others here. But some of the stocks they just seen their stock prices go crazy. If you own these type of stocks, you got to really consider if you haven’t already taken profits in that man.
Just taking those profits moving to cash or moving that money into some more stable companies that are likely not as big a question marks and don’t have insane valuations on them, considering they have no business model Nicholas sock, for instance.
when I first spoke negative on that that particular day, this the shares after hours were trading at like $90 a share, as we just saw, like 63 days, so they’re already down massively, but it’s still like, you know, a ridiculous valuation the company consider they’re doing nothing.
And these type of stocks, they’ve been awesome, they’ve treated people that wanted to try and make some quick short term money that treated most of those folks really, really well, well, unless you’re the person that was buying at $90 a share, because there were people that buy were buying at 90.
There are people buying at 80 and there are people buying a 70 evaluation has gotten so insane a stock like this, I think you just got to consider potentially maybe taking some profits in that there’s nothing wrong with taking a sweet profit on a name like that it’s got an insane valuation space, your Virgin Galactic.
This is another one of those that, you know, if you’ve made a crazy amount of money on that, you gotta at least consider potentially taking some profits on this one, I first called up this company’s valuation back when I was like, $28 a share. And I was like, this looks, you know, insanely rich, it was like 27 $28 a share.
That was actually several months ago. Now, obviously, the stock has fallen, you know, 40%, roughly, from when I did those videos, but it’s definitely a stock, you got to consider maybe, maybe potentially, you don’t take the profits unless you’re in it for the next 10 years, which you know, respect.
If you are outside of that scenario, I think you might want to take you know, consider taking some profits, because a lot of people made a lot of money in that one, zoom ticker symbol Zeum on this one.
This might be a profit time for zoom, Okay, this one, it’s not about, oh, well, they’re gonna continue to expand business, everybody in the world knows zoom is gonna continue to expand their business.
But the fact is, their businesses are really small business actually, in their market capitalization is $72 billion. And this has been the play, okay, this has been one of the main plays that investors have wanted to get into, and the whole.
Like, you know, work from home environment and everything like that, and investors have piled into this one, they have shocked the valuation they have moved the valuation up, like we’ve very rarely seen on a company like this, where it was like a $20 billion market cap, which already looks pretty rich to then a 40 billion, then 60 billion in here today, well over $70 billion.
If you own zoom stock, I think you gotta at least consider the possibility of maybe taking profits on this one, because the valuation has gotten absolutely ridiculous for this one, just flat out. It’s not even about the whole, you know, work from home trade or move anymore.
Now, you just got to really think it fundamentally, is it business justify a $72 billion valuation? Or will it justify in any upcoming years, but $72 billion valuation? In my opinion? Absolutely not. I’ve looked into this company.
And yes, they’re going to continue to grow revenues, they’ll probably get profitable, but I’m telling you like the it’s going to take them, I don’t know if they’ll ever grow into this valuation. And if they do, it’s going to be like a decade from now.
It’s gotten that ridiculous with the stock like zoom, you got to consider maybe its profit time, Shopify stock. Another one you got to at least consider maybe potentially taking some profits. In Shopify.
It’s well over $900 a share and market capitalizations 108 billion Shopify will continue to grow its business but this is another one similar to zoom, it’s going to take them a decade just to make this current valuation make any sense because the business is so fractionally small compared to the market capitalization.
We’re talking about 100 plus billion dollar company like this is massive. So when you’re looking at some of these stocks, you just got to consider maybe potentially taking some profits in them. Before you know any real weakness happens out.
There’s nothing wrong with moving some of that money into some more stable companies because these ones have run a lot. They’ve had some you know, big trends behind them that everybody got super excited. And when that happens, guess what?
The trend ends up ending in the stocks usually mostly go down. Okay, something to keep in mind there. number two thing you got to do right now is you got to get the ammo ready, man yet got to get the money ammo ready. Okay. The fact is, we’re starting to get a few deals out there. But if this market continues to weaken a lot, a lot, a lot of deals will start emerging.
If this market can really weakened, we can see a doubt 22k a doubt 20k It doesn’t even have to go to 18k like it hit in the march lows, if we just get this market down to 22k or 20k. There’s going to be an enormous amount of companies that you’re going to make a ton of money in over the next three to five years.
And so you definitely got to get the ammo ready. Now a piece of advice I want to give you here. Okay. Don’t get greedy. On the downside with the stocks, I want to explain in detail exactly what I mean. But I definitely am seeing some folks get a little greedy here.
And I want to give you an example of that and show you kind of what you’re missing out for potential opportunities and some of these stocks. So this is something I’m seeing so often in the stock market right now I’ve seen in my private group with a lot of members and the way kind of they’re talking.
I’ve seen in the comment section. There’s nothing wrong with wanting a particular price or like I got this specific price for stock But I just want to make sure you guys don’t take it too far and get too greedy.
Because I know I have made this mistake several times on stocks in the past where I get too greedy around what your specific price I want to stock out. Okay, let me give you an example is. So let’s say you look into this company XYZ company, okay?
You love this company, it’s $100 a share today. And you’re extremely confident based upon what you looked in with the valuations, the management team, the business fundamentals, everything across the board, you’ve done your full research on this, you’re very confident that over the next three years, it’s going to go to $200, because the net income is going to go to this amount.
And the the valuation the company will command p wise will be X amount. Okay? So you’re saying it’s 100. Today, you think it’s going to 200? over three years? Great, that would be amazing, you double up your money in a three year span.
But what I’m seeing definitely some from you know, from some folks out there, and I’ve made this same mistake in the past plenty of times, okay, including in the march lows, hoping it goes even lower.
Now somebody’s saying, well, I like it to go down another 3%. I really want the stock for 97. Before I buy, okay, and the problem with this is, it doesn’t always go to that 97, okay, it might go to 98 might go to 99. Or it might start going up.
And when you don’t get that position built, and all sudden it goes to 103. And then 105 and 110 and 120. All of a sudden, you’re like Dang, I missed that one. It also over the next three years, it goes to 200 a shirt just like you would thought after all, you had fully researched this company you had put in all the work you knew was probably gonna go to 200 over the next three years.
It does that. But you never got to positioning all because you were worried about getting it at 97 instead of getting it at 100 or 99. Does it really matter does that 3% really matter, not the company you believe is going to double over the next three years, it just doesn’t.
If you had some type of real real value stock, you have to really be specific with pricing on it, you really do with Coca Cola stock, for instance, you have to be very specific with where you buy that stock at. But some of these companies that are great companies that you you think there’s a high probability it’s going to double up or more than double up over the next three years.
Because of all these different reasons you’ll begin to do. It’s just silly to hope you know what goes down another percent 2% 3%, even 5%. Because at the end of the day, you can’t get too greedy with this. You got to get your foot you know, the amount of stocks I’ve made this mistake with over time is a huge list.
I’ve been a stock mark for over a decade. This is what I seriously do. I look into stocks all the time. And I’ve been doing that for over 10 years now. The amount of times I’ve made this cardinal sin, let’s call it is ridiculous.
Okay, where I’ll be looking at a stock I’m like, I know it’s destined for great things over the coming years. But I get so greedy around a little short term stock price in one and at this specific number.
And everything plays out exactly how I thought it was gonna play out in there. I’m on the sidelines just looking. I’m like, wow. So all because I wanted to go down another 2% or 4%. I just missed a double up on my money.
I made this mistake countless times. And so make sure you guys don’t make this type of mistake when you see these these markets down trending. Don’t get too greedy when it comes to pricing. There’s nothing wrong with wanting to always pay a fair valuation.
But there’s a difference between paying fair valuations for stocks that you believe are going to go up a lot over time and getting greedy with pricing it like I said, I saw this in the march lows, there was no stock in that in those March lows that was low enough for some investors like it’s gonna go even lower.
And you know, this stock I wanted at this price. And it’s like the stock would go that person then they’re like I want at this price. That’s just pure greed and no different than if a stock is going up like crazy. People get greedy on that side.
And they’re like, well, it might even go up another 2%. Because look at It’s so hot, then of the day, you just got to look nice. I say in my opinion, fair valuation, or not repaying fair valuation, more than likely. And that has huge potential upside over the coming years more likely, it makes sense just by and not get too greedy with that.
And as long as you always keeping cash and silent, you’re always ready. Like if it goes down more great, you can just lower cost basis and you get shares for even a better deal than you got before. There’s absolutely nothing wrong with that as well. You always got to keep 10 to 30% in cash in my opinion. So hope you guys enjoyed today’s video.
As always, let me know your opinion down there in that comment section. I would love to hear from you guys. Don’t forget first link down there if you want to learn how to build a low risk, high reward portfolio, that full videos down there.
It’s the first link in the description. You’ll definitely enjoy that one. And don’t forget to smash thumbs up to the YouTube algorithm. Thank you for watching and have a great weekend.