Why are markets volatile now?
Simplified answer: Ever since trump got into office, a lot of what tweets (believe it or not) affects trading in the market. We have seen this Elon Musk as well.
There are pros and cons of trump being president. The pros are that he’s more focused inward (for the US), aka not interested in foreign affairs/trades that much. Which is why my dad gets good GOV’T jobs. The cons are the investors do not feel secure about the market (note: market is not only trading stock, think about resources as well). When people are insecure in the market, they do not invest. Which in turn, it causes companies not to invest in a resource bc they don’t know if it’ll be profitable. Therefore, my dad loses out on those private jobs (note: private jobs are not gov’t jobs).
Why should I be careful on trading stocks?
I’m trading on the stock market as we speak, but I am planning on pulling out soon. The US goes thru a major economic down turn every 10 years. What are the signs? The fed lowered interest rates TWICE already. Why is this a big deal? The fed want people to invest more and get loans from banks. The more we borrow, the more debt we accumulate. This is like a ballon that we keep putting air into. One day, it’ll burst.
That will come around summer 2020 here. You will see a huge down turn in the market. This is why I recommend people to wait on buying a house until next year since no one will be investing when that time comes.
As I mentioned before about this ballon, when it bursts (economic downturn), I know people have a high possibility of losing their jobs. This will lead to people to foreclose their homes (will be hard to find someone who will invest/buy at this time). But, if you are someone who understands that history repeats itself, there is a time for saving, and a time for investing. You can be the person buying land at very cheap other than being a sheep and investing bc the fed wants you to (by lowering interest rates). I HIGHLY recommend that you read ‘Rich Dad Poor Dad’ to visualize economic trends. This book was published in ‘97, but this guy had it figured out and it STILL applies to the world (as always: history repeats itself, you just need to find the trends).
I see you’re investing in tech companies, I would say make sure you do your research and see how professional and business-like the CEO and owners are. I compare tech companies to marijuana companies bc they can be run by guys who are in the market bc it makes good money, but they don’t know how to manage it. And in turn, the company will go down and you will luck out. Also, there is a way to show you had a loss if you are in the US and pay taxes for investments, you’ll have to do that research if you’re interested.
My overall opinion?
I wouldn’t recommend anyone to get into US stock market rn. I would say to invest when we go through that economic down turn.
