Crisis investing: stock market crashes represent opportunity & not disaster
The Tactical Investor states that as long as the trend is up or unchanged, you should jump for joy. In other words, buy when the masses panic and sell when they are joyful. This simple illustration explains why all sharp corrections or crashes or whatever the naysayers would have you believe are nothing but buying opportunities.That is really what crisis investing is all about, seeing opportunity where others see disaster. Take a look at the long term chart below or any long term chart of any major index and you will see that in every instance the markets recouped their losses and trended higher. This begs the following question; for whom exactly are these Wall Street experts working for? The answer is obvious; they sell their services to the highest bidder. In this instance, this happens to be the shadowy top players who know precisely when to sell and when to buy.
They know this information because they have utilised exactly the same strategy dating back to the Tulip bubble (and probably earlier). The idea is to create huge fantastic stories of the carnage that lies in store for the market the moment it starts to pullback. In doing so they sow the seeds of doubt into the masses and when the masses are in doubt, it is easy to trigger a stampede. Once the masses stampede logic goes out the window and panic takes over and the top players come in and purchase all the top stocks the masses are dumping for pennies on the dollar. Every Stock market crash is nothing but a repeat of ground hogs day over and over again.
A Crisis is the secret code word for Opportunity:
Look at this chart carefully; most will see disaster every time the Dow Jones pullback strongly. The would falsely classify this is a the end of the world but in reality is was nothing but a buying opportunity. When Fiat ends, and nobody knows when that day will occur, we might have to change our mantra. Until that time, extremely strong corrections have to be viewed as buying opportunities.
This chart dates back to 1990. What do you see? Well, we will tell you what we see? There is no such thing as a crash? A market crash is a matter of perspective, and the masses always examine the situation with fear as their guide and stupidity as their master. It is a crash only if one is stupid enough to wait until the top to commit all one’s funds which the masses are famous for doing and if one is equally stupid enough not trade without any stops in place and then close the entire position at or close to the bottom. If you were playing the trend all the way up, then it’s a correction to a pullback because hopefully, you were prudent enough to continuously take some money of the table along the way up. All corrections are should be viewed as bullish developments; the stronger the deviation from the mean the better the buying opportunity, illustrated by the green boxes.
Look at the chart above; who won the from 1990-2016, the bears or the bulls?. This chart is a clear illustration that the Doctors of Doom only make their money by selling the masses crap they would never dream of using.
Our updated article published in 2017, clearly illustrates that Market Crashes from a long-term perspective should be viewed through a bullish lens.
On a lighter note
What do you think of this video? Is it cute, or funny; if you did, please comment at the end of this article? Videos with positive emotions are said to lower one’s stress; they provide one with the ability to view things from an objective perspective. When emotions do the talking, logic does the walking, and the result is far from healthy or pleasant. Please comment below and let us know if you find this new approach to be of interest.