I saw this coming from over a year ago, I predicted that at some time in the future we would have a rational or irrational stock sell off. I have bought into this crash almost every day (and I'm happy with every single purchase) HOW IS ALL THIS POSSIBLE?
Actions I have taken before this crash (currently at the time of writing this -12.7% from highs, could be more tomorrow)
My whole investment thesis for equities is to invest in companies with dividend growth, I don't time the market I invest every Monday morning regardless of the indicators. If the market goes down I invest more (I call it Carpet bombing) Right now I'm getting ready for a Recession, and when it occurs I will start my rotation from P2P loans into my Equities (I talk about it here "Investing, How to get started...")
How did I predict the crash, there was no one thing that caused me to do this, I take in a massive amount of new and media and it seemed very obvious. For example a couple weeks before the first case was in the US, I said I bet we'll see prices on masks and had sanitizers got up 2x, 5x, 10x, etc as there sold out of retailers and now (30+ days later) that is the reality.
The last recession I would go to work and try to talk to people about how the housing market was a giant bubble about to pop, and how the adjustable debt was a huge issue if that happened. No One wanted to talk about it aside from a few special people. This time I was talking about our over dependence on China and its slowing economy and Chinese banking and global debt issues, then I heard that china was arresting doctors for warning the public. Again people didn't seem to care, say things like only 100 people are dead, the flu kills more.
I think looking back we will say COVID-19 wasn't that bad, but I also think a lot of people will have lost real money and have to delay there retirements, lose there houses, default on loans, etc. So what will be the reason for these losses: COVID-19 Panic? shelter in place? lack of preparation? break down in supply lines? Chinese Banks/Lending? Global Debt? Everything?
Actions I have taken before this crash (currently at the time of writing this -12.7% from highs, could be more tomorrow)
- 12 months before crash, decreased allocation of higher risk P2P loans
- 8 months before crash, add a new income stream
- 8 months before crash, decreased unsecured P2P loans
- 8 months before crash, increased short term (30 day) P2P loans (for better access to cash)
- 8 months before crash, increased Bonds from 5% to 10% (of paper assets)
- 8 months before crash, increased Gold 1% to 5% (of paper assets)
- 5 months before crash, sold out of oil stocks
- 4 months before crash, add a new income stream
- 2 months before crash, increased Bonds from 10% to 16% (of paper assets)
- 2 months before crash, increased Gold 5% to 7% (of paper assets)
- 2 months before crash, sold week positions for a gain (stocks I didn't think would do well in a recession, but I may rebuy at a lower cost)
- 2 weeks before crash, predicted it
- 1 week before crash paid off high interest car loan 54 months early
- day of crash, bought more paper assets
- 1 day after crash, bought more paper assets
- 3 day after crash, bought more paper assets
- 4 day after crash, bought more paper assets
- 1 week after crash, bought more paper assets
- going forward I will continue to buy good assets at discount prices every day
- I wanted to get to 20% Bonds but in the end only got to 16%.
- I wanted get 30% of my P2P loans in short term notes (90 and 30 day) but only got to 20%.
- I wanted to sell 4-5 rentals that need of a lot of work (while prices are high) and only sold 2.
My whole investment thesis for equities is to invest in companies with dividend growth, I don't time the market I invest every Monday morning regardless of the indicators. If the market goes down I invest more (I call it Carpet bombing) Right now I'm getting ready for a Recession, and when it occurs I will start my rotation from P2P loans into my Equities (I talk about it here "Investing, How to get started...")
How did I predict the crash, there was no one thing that caused me to do this, I take in a massive amount of new and media and it seemed very obvious. For example a couple weeks before the first case was in the US, I said I bet we'll see prices on masks and had sanitizers got up 2x, 5x, 10x, etc as there sold out of retailers and now (30+ days later) that is the reality.
The last recession I would go to work and try to talk to people about how the housing market was a giant bubble about to pop, and how the adjustable debt was a huge issue if that happened. No One wanted to talk about it aside from a few special people. This time I was talking about our over dependence on China and its slowing economy and Chinese banking and global debt issues, then I heard that china was arresting doctors for warning the public. Again people didn't seem to care, say things like only 100 people are dead, the flu kills more.
I think looking back we will say COVID-19 wasn't that bad, but I also think a lot of people will have lost real money and have to delay there retirements, lose there houses, default on loans, etc. So what will be the reason for these losses: COVID-19 Panic? shelter in place? lack of preparation? break down in supply lines? Chinese Banks/Lending? Global Debt? Everything?
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