Apparently the USA is on the verge of collapsing 
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The markets have been expecting a fed funds rate cut in September for many months.
At the same time, many signals have been in classical recession territory for many months (e.g. the Treasury yield curve, the Index of Leading Indicators, the PMI Manufacturing survey).
The economy is not on the verge of collapsing. It’s equally likely that the markets will celebrate after the Fed cuts the fed funds rate in September even though they expect it.
That might make the current tumble a buying opportunity that will reverse in a month.
Maybe.
Wendy
7 Likes
Don’t forget people are openly wondering if this is an AI bubble, and if so does it pop. Because if it does, look out below is all I will say.
…or maybe the calculus for early November is changing? Maybe the outlook is not as “pro-growth, business friendly” as previously anticipated?
Steve
Good advice from the late Charlie Munger.
"If you’re not willing to react with equanimity to a market price decline of 50% two or three times a century,” Munger declared, “you’re not fit to be a common shareholder and you deserve the mediocre result you’re going to get.”
I’ve already seen 50% stock market declines in 2000 and 2008, maintained my mostly stock asset allocation, and slept well at night. I expect to do the same in the next one.
intercst
12 Likes
The stock market has fallen all the way back to where it was in…June.
10 Likes
Yep. If I was trying to time the market, I’d be paying hundreds of thousands of dollars a year in capital gains taxes for the privilege of poorer results.
intercst
2 Likes
I’ve already seen 50% stock market declines in 2000 and 2008
Don’t forget 2020. Not 50%, but up there.
V
Same here and I’ve seen enough of them to last a life time. :D. Luckily I sold off 2/3 of my QQQ over the last month. Much of that put into low-volatility (VFMV) and value (VTV).
I’d give an ai implosion
Oil as well