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StockTalk
StockTalk

Season 1, Episode 5 · 1 year ago

Has the market bottom or is the worst yet to come

ABOUT THIS EPISODE

This podcast covers the important question has the market bottomed out or are we heading to the next big depression

Good evening everyone welcome totoday's podcast. It is twenty eight manths, two thousand and twenty, andit's going to be a short podcast it's Friday evening. So let's make it quick.Let's learn something and see you again on Monday. So before we start thedisclaimer, this podcast is only for education purpose and does not give anyinvestment advice. It should not be considered as investment advice if youwant to invest connect with your investment adviser or study the stocksfurther. So let's do a market review today, SB five hundred went down todayfor and half percent Tou Jones around four and a percent again NASTAC wasdown three point: seven, nine percent and Px two point: Six: Two percent, somarkets are behaving extremely weird...

...they're, going up one day, they'regoing down the other day, so there is still a lot of voletality in the market.I'm getting questions online and that I am going to address today. Has themarket bottomed out and is the worst over and whatever go governmentstimulus is being floated around. Will that help? So? Are we heading towards a recession?Probably yes! Now there are two types of recessions: There is supply siderecession and there is demand side decession. So what is a supply said tosession supply? Sid Recession means your income stops. The businesses are not able to sustainthemselves, they go bankrupt, they file for bankruptcy and your income stops.So is it happening right now that thewerall income in the economy of were on employment in the ECONOMYIS folloing?Yes, because businesses are struggling...

...to survive? That's why there there is alot of unemployment right now. People are not being paid. They've asked notto come to work, so there is supplysigt pressure right now on the economy. Thenwhat does demand sad recession? The mindsigt recession is when consumursdon't spend, they they're afraid of spending, they want to save money orthey are not getting paid so they're, not spending on stup. So that'sdemandside recession. So do we have demindsite pressures right now on theECONOMYC? Yes, a lot of people are staying home. Whole economis have beenlocked down. People are not going out: they're, not spending they're, notspending on restaurants, they're, not spending on cars, they're, not spendingon entertainment, they're, not spending on pretty much everything exceptgroceries, so there is demandsite pressure to so right now we are in amix. Well, there is supply sigt pressure and there is de mindsightpressure in two thousand and eight more or less. It was a supply side,recession, companies, file for...

...bankruptcy. There was a trickle downeffect and then the demand writet, but right now it is pretty much more worsethan two thousand and eight because we have supply side recession as well as demandsite pressure. So the economy is quite strainge right now. If you want tocompase something like this. In the past, it was the Spanish flue n toadNinetuneen, N Seventeen, nineteen eighteen, Spanish flue world war wasgoing on the entire. U, United States andCanadian economies were built around war. The demand dropped out because thewar ended and the demand dropped out because the Spanish flu started. Sothere was supply site. That is, the demand dropped out. The war industriesstarted filing for bankruptcies income stopt, as well as the Spanishflaimpacted people. They were not going out. People were sick, they were notspending, so it led to the great depession. So are we looking at a greatdepression? I don't know, but the SCIENS are very bad right now in theeconomy, entire European economies are...

...blockdown. China is still coming back,but it's not fully functional Asian economies are struggling, NorthAmerican, economis or locktown. So science are that the Times ahead arenot deat Rosi, so what's happening. So I Saif Iwaundred has had a thirty percent drop SAP TSX had around thirty percent.Again toujons is thirty. Two Percent Down NASZAC is twenty five percent downten year. Balnick EELD is very low. It is almost zero pont nine three percentand we have a chance that Tenere Bol neelland overall overnight rate, may gonegative to so. We have a lot of pressures right now, so sectors that have worst hit becauseof both demand and supply, so travel and tourism is down. Entertainment isdown. t restaurant is are shattered, every sector pretty much suffers. Sothere is demand damage in every other sector, so...

...things are bad right now and they mayget worse. So government is floating a lot of stimulus, so there, as there issupply, sets to milis that tries to sustain the industry that size tries tosustain the job market so that it can be bailout. So it can be. Creditsupports. Struggling industries are given lot of credit so that they cansustain themselves. They can pay themselves or there are bailoutgovernment comes in and bills and particular industry or a particularcompany out. Then there is demandsite similus where economis or governments are puttingmoney into people's pocket by giving an employment insurance by giving flat outchecks like the idea that is being floated around in state. So does ithelp? So I am not a strong believer in stimulus. I agree with the mandsitstimulus because people should not suffer. I do not agree. Ith Supply sihtsimilar S. If companies has taken a lot of debt and it is struggling because ofthat, then the government should not...

...step in and bail it out, but I have myown views, but I don't think this is going to help, because even if you putmoney into people's pocket right now, they're going to save it. Unless thereis spending in the economy and unless the consumer is spending, the ECONOMYCdoesn't drive itself. Our economies are based on consumer spending. I repeatthis again and again: Our economies are based on consumer spending. If theconsumer doesn't spend, if he is afraid to go out, if he's holding moneybecause he's uncertain about his own future about his own income, theycaromis don't drive themselves. So I don't think stimulus is going to helpmuch. The only thing that would bring back this economi is if we find a curefor the virus that's going around. If the vaccines are developed and the fealthat's there in the people about their future jobs about going out aboutcontacting that virus, this dies down only that is going to help. So I do not.I don't think you should trade on...

...stimulus per se, but he should look outfor news regarding any cure or any vaccines that are being developed. Onlythat thing would help the economy or help the market going forward.

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