Is the Stock Market Lying to You? How to Invest in a Crash

The stock market is lying to you! Understand how stock prices are wrong and how to invest in a stock market crash! Free Report, See the Stocks I’m Buying Right Now https://mystockmarketbasics.com/motleyfool Weekly stock market update every Monday before the market opens. All the stock market news, strategies and trends you need to start your week. I’ll show you the sector trends, what I’m watching for the week and the stocks that will highlight the week. The market is now down 10 of the last 11 weeks with selling spreading to every sector. Unfortunately we are not yet to the level of desperation and capitulation that normally marks a low and are likely to see more weakness over the months ahead. 🤑 Get The Weekly Bow-Tie - my FREE weekly email newsletter sharing market updates, trends and the most important news! Market Updates for the Smart Investor! https://mystockmarketbasics.com/dailybowtie The prevailing story in stocks seems to be; inflation is out of control, the Fed will have no choice but to raise rates so high it chokes off the economy and forces the U.S. into a recession. The story further goes that stocks, with valuations based on low interest rates last year, are now worth at least 20% less in most cases and upwards of 80% less in the case of many growth stocks. But is that story a work of fiction? Investors think that, because the market is supposed to be rationally based on economic facts that market prices are a work of non-fiction. Because the market flows from human decisions though, there is a psychology and emotional cycle to stock prices. Just like we tell ourselves stories in our own minds that are sometimes far detached from reality, so are sometimes the stories the market tells us about stocks. Let’s reexamine the story. Yes, interest rates are marginally higher and expected to continue higher. Inflation is at multi-decade highs and it is likely the Fed will err on the side of raising rates too high and causing a recession. While some analysts are calling for stocks to fall much more, even as low as 2500 on the S&P 500 or about 49% from last year’s peak, I have heard of nobody calling for a secular bear market that lasts more than a year or two. Technological advancements and relatively good labor force dynamics still point to a business cycle recession and cyclical bear that turns into the next bull market within the next few years. So if stock prices and economic growth are likely heading higher into a new bull market within just a few years, is the current market story on growth stocks more than just non-fiction but maybe even delusional fantasy? The point is, how you make money in stocks…really the only way you make money in stocks is to understand what story the market is telling investors and when it’s off from reality. One year ago, the story on many growth stocks was an exaggerated work of fiction. The companies were going to change the world and be worth tens of billions of dollars. Now the story has changed. The companies are still changing the world and will be worth tens of billions of dollars but the market story is one of a nihilistic despair. Both stories are or were wrong. Understanding when and how the story the market is telling investors is how you not only make money, investing in the beaten-down names in a crash, but also how you avoid losing money by not buying into the fever-pitch at the market’s top. Stop thinking that the market is ‘rational’ or factually-based and realize for as long as human investors buy and sell stocks, our emotions will always write a market story…one which is only loosely ‘Based on a True Story’. My Investing Recommendations 📈 Check out the stock simulator and Get a FREE share of stock worth up to $1000 when you open a Webull investing account with a $100 deposit! 🤑 https://mystockmarketbasics.com/webull 📊 Download this Portfolio Tracker and Investing Spreadsheet! [Community Discount Code] https://mystockmarketbasics.com/spreadsheetdiscount Free Webinar – Discover how to create a personal investing plan and beat your goals in less than an hour! I’m revealing the Goals-Based Investing Strategy I developed working private wealth management in this free webinar. Reserve your spot now! https://mystockmarketbasics.com/free-investing-webinar SUBSCRIBE to create the financial future you deserve with videos on beating debt, making more money and making your money work for you. https://mystockmarketbasics.com/LetsTalkMoney Joseph Hogue, CFA spent nearly a decade as an investment analyst for institutional firms and banks. He now helps people understand their financial lives through debt payoff strategies, investing and ways to save more money. He has appeared on Bloomberg and on sites like CNBC and Morningstar. He holds the Chartered Financial Analyst (CFA) designation and is a veteran of the Marine Corps.