Stocks fall periodically. This is due to people buying stocks on borrowed money and can’t afford to sit out downturns, for example. Holding stock that pays good dividends works great. Not panicking every time there is a hiccup in the market means over many years one collects lots and lots of money. People who want fast money also cause panics. Understanding that markets go up and down is key to a lifetime of few worries and serenity of the mind. Of course, exiting stocks when a company is going the wrong direction is also key to not losing money. This is why attending to information and basic awareness of the way a business is trending is highly recommended.
Panics cause pandemonium. The word ‘pandemonium’ is all about pandas, those amazingly cute, cuddling Chinese animals that caused riots when first viewed in London when the British invaded and looted China over a century ago. The Chinese, by the way, have not forgotten about this event. Ahem.
The Chinese are one of the oldest civilizations on earth. They have many good features especially amazing work ethic. Also, China has produced many very brilliant humans who can figure out so many amazing things, the legions of inventions first created by Chinese people is long and stretches back thousands of years. My family is part Chinese especially my grandson. Intellectual brightness is a common feature and he is very inquisitive and learns easily and wants to please a great deal.
But China was enslaved by the Manchus and then the Brits and then by the Japanese warlords and then Mao who was by far, the worst of the lot. And now is more or less ‘free’. And bursting with energy and like the US before this, is falling off the same cliff the US fell off more than once: wild speculation followed by sickening crashes. The Chinese have to learn all the harsh lessons the US must learn and note how we aren’t doing so hot with our own economic lessons, are we all? Nope.
The screen shot at the top shows that the Chinese are having a secondary downturn which often happens when there is a big crash. Screenshots about 2015 show the same crash only it was much worse back then:
The Japanese, after their big crash, did something very stupid: the rulers kept it crashed into the cellar and so the country is dying, literally. Young people have given up creating families and the birthrate is off a cliff, less than half of the upcoming generation is even thinking about marrying and the 25-35 group is way, way behind in producing any children at all. This ‘eternal depression’ rides on the back of huge trade surpluses with say, the US.
But not one drop of wealth is falling between the cracks built into the system by the very rich there. This is shaping up in the US, too. All the wealth at the top, the rich hire foreign labor, kick citizens to the curb, build huge, high walls around their palaces and then let in millions of criminals and drug dealers…yes, will the US public revolt?
Seems the left is siding with the super rich. OUCH. How dumb is that? Trump is rich but then, conservatives are supposed to like the rich. But the leftists are supposed to hate the rich. What gives here? Oh, Pandemonium. We shall see if the Chinese figure out how to avoid bubble/crashes. Will they copy dying Japan? Or going insane US rich leftists? We shall see. I am very interested in how this works out.
The sane thing to do is avoid bubbles. This is up to INVESTORS. They have to keep their heads and not rush into wildly rising stocks…these always spell trouble. Steady and good growth is the way to go. It seldom fails.