Ep 121: Stock Market Bubble & Are We in a Bubble?

★ SUMMARY ★
“Market bubbles” is a very emotional discussion for many people. In the market, there are always ups and downs, but a bubble is something that people are always worried about, even just regular human beings, not just traders and investors.

Market bubbles can affect your finances in a catastrophic way, you can lose your house or your investments, and in order for you to recover from that, it takes many years.

From a personal point of view, the way bubbles are created is because people buy things they don’t need, with money they don’t have, and they accumulate debt, more and more debt. They live all their lives like that. Eventually, it gets to a point where the debt cannot be paid by the person, so they go bankrupt.

Why does this happen? You may ask. Well, it’s because people go through an emotional high, where they don’t care about their debt because they feel good buying lots of things. And they build their lifestyle around this bubble that’s not sustainable, until one day the bubble pops.

Bubbles are created because people are greedy. And the same happens in the markets. People start buying based on their emotions, and things start getting overpriced and stretched, and because of the rubber band effect, eventually, the market crashes down.

Most people don’t realize they’re in a bubble until it’s too late because they don’t have awareness. That’s why I always say: when everybody wants to buy, that’s when you should sell, and when everybody is selling, that’s when you should be buying.

In this video, we’ll evaluate some of the great market crashes in history. I’ll also analyze the current market, we’ll compare it and look if there’s a bubble taking place and what you could do about it.

Posted at: http://tradersfly.com/2017/02/ep-121-stock-market-bubble/

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20 COMMENTS

  1. as a swing trader i always put a stop lost on all my position to protect my profit or money. for the average investor, they are basically sol because most don't put a stop lost. that is the advantage of a swing trader vs an investor.

  2. Also feel that a lot of what is going on in the market right at the opening bell is a fake out, could be wrong but just my opinion.  The Run up in prices at the opening bell every morning then selloff throughout the day bring prices back to where they left off at the close the day before only to repeat the process at the opening bell the next day.  Guess you learn a lot by just watching what the hell is going on.

  3. I have to disgree a little bit with the message in this video. If you are investing for a long term, these highs and lows dont matter so much. If you save to sp500 index every month for 20 years, your are going to eventually buy at high and low prices and that evens it out. If you reinvest the dividens every time, you cannot lose money in the long term, if the economy keeps growing of course.

  4. Sasha; that was nice presentation. Taken into consideration the volume of printed $, don't you think it is great idea to adjust the index that you referring to with gold and accordingly adjust the value with US$ actual value? This is for the purpose of anticipating the bubble you expect. Appreciate your feedback. Thanks again for the presentation.

  5. Couldn't you say that Obama, or any president, should be more critical and make moves to reform the system and stop relying on the FED though? It seems they would have some responsibility in that sense.

  6. And they say no one rings a bell at the top. Sasha is ringing the bell. Econmatters is ringing the bell. Alarm bells are going off everywhere right now. Time to get out and wait for the right opportunity to buy back in. Be patient. Be sure of what you have learned about markets. They go up and they go down. Wait till they go back down, and then get in. Be patient. Patience is the only virtue in the markets. Forget shorting anything. Just be patient. Cash is king when the crash does happen.

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