In retrospect it is easy to see that the dot com bubble was going to burst and that the market was going to crash in 2008. Going back to the market crash that ushered in the Great Depression hindsight always tells us what should have been obvious. But the market always seems to have trouble seeing the next big stock market crash. Part of that may be that many investors have commonly made a lot of money and are trying to eke out just a little more profit before getting out. Those folks who hang on until the very end commonly forget the adage that you do not have a profit until you take a profit! Here are some thoughts about the next big stock market crash, taking profits, diversifying investment portfolios, the value of cash, where to put your money ahead of the next big stock market crash. And where will the next big stock market crash be? We are predicting that it will start in China as the real estate and lending markets implode and that will spread to every nation that relies heavily on China as a business partner.
Reading the Signs
London is abuzz with all of the new high-rise construction. It turns out that rich folks from all over the developing world are moving to what they consider a safe new home. At the same time they are moving their assets into British Pounds, Euros, Yen and US dollars as well as London real estate. If you are getting onto a ship and you see all of those furry little animals (rats) leaving, you can assume that down in the hold beyond where anyone sees, there is a problem. People from all over the world are seeing problems in their local economies and taking steps to protect themselves and their family wealth. In fact, the news is full of speculation about the troubles in developing nations around the world. Many have prospered selling raw materials to the growing Chinese industrial machine. But, Chinese manufacturing is off. There is a gigantic real estate bubble in Mainland China. And countries like Brazil are putting off being the next Western Hemisphere superpower as exports to China dwindle. In fact, rich folks in China are scouting out property in the USA, Europe and Great Britain in order to diversify their holdings. We believe this is being done ahead of the next big stock market crash, starting in China and spreading across the world.
Fundamentals Tell All
If you want to anticipate the next big stock market crash you need a mixture of fundamental analysis and technical analysis of market sentiment. Before the next big market crash hits you want to be safely on the sidelines, in a solid currency or holding land where values are going up. And, following the blood in the streets advice of Baron Rothschild you want to be ready to buy during the depths of the next big market crash when things look the worst. Decide when to sell stocks and when to buy again, stick with a sound investment strategy, and remember when you cash out that you do not have a profit until you take a profit.