Crowd Psychology: Surge in negative Headlines means stock market buying opportunity.
Misery loves company and stupidity simply adores it. And the media’s are masters at making things look worse than they are and blowing things out of proportions. Gone are the days of telling the truth, today it’s all about sensationalism and or even outright lies. As long as they can attract eyeballs nothing is off limits. Which is sad in the way as once upon a time the press did provide some value? Today the news you receive from popular outlets is on par with toilet paper. Take a look at these recent headlines; the hidden agenda behind these negative headlines is to trigger a stampede. Our response to this yesterday, today and tomorrow were the same. When the masses panic, jump in and buy and when they are joyous run for the hills.
Recession sign is in play and has 81% accuracy
Yield curve recession indicator sends warning on US economy
David Levy Forecasts a Global Recession in 2016
U.S. economy hits soft patch in fourth quarter as inventories, trade weigh
Why 2016 keeps getting uglier for US economy
“We Are In A Recession”: Dallas Fed Respondents Admit The U.S. Economy Is In Freefall
Will America’s economy get dragged into recession?
While the spin doctors scream of a day of reckoning, we think of what a day without them would feel like. These spin doctors are nothing but parasites, sucking the energy out of healthy individuals with their dribble. The world will end one day; you will die one day and blah-blah. Who cares about one day? You have today; actually, all you control is this moment. Focus on the moment and seize it, instead of trying to plan for a time in the future you have absolutely no control off. To understand the future, you need to know what is taking place right now. In one second right now will become the past and the next second will become the present. Focussing on the present gives you the chance to not only shape the past but the future. To get a glimpse of what the future holds, in general, all you need to do is look at the masses. What has changed, the same con is still being pulled on the crowd; crap is wrapped up and marketed as Gold and the masses drop everything to buy this new excellent product. The outfits and players have changed, but the theme is the same, its ground hogs day almost every day when it comes to the financial markets. Nothing has changed, and nothing will change for those who embrace the mass mindset.
On a separate note, volatility is indeed hitting every aspect of everyone’s life as we predicted last year; look at the elections, if this is not extreme volatility on display then we don’t know what is. Extreme V readings not only reflect what is going on in the markets but they also cover what is going on out of the markets. Hence, you should continue to expect extreme weather patterns, erratic human behaviour (extreme surges in stupidity and violence) and a surge in extremism (violence in some areas, peace in others, etc.). If you embrace volatility it will have almost no impact on you, for you will be in a position to view the situation with a set of clear eyes, resist and you could be in for a helluva wild ride.
Don’t listen to the Doctors of Doom; negativity should be viewed as a preview to a lovely buying opportunity. Wait for the crowd to react to the negative news and then jump in and buy quality stocks. You should prepare a list of stable companies you would like to own over the long run, so that when opportunity knocks, you are ready to act. Some good companies to look at are RTN, OA, COST, CALM, GOOG, NFLX, etc.
Other related stories: