Dear readers, in recent weeks, it seems to me that there is an increasing number of articles on the internet which suggested that the global stock markets will be undergoing a correction in the next few months. Google “Stock Markets Crash” and you will be greeted with many search results on articles related to stock market crashes.
A key driver which I have been reading about for the possible reason why stock markets may crash is related to possible tapering by the US Federal Reserves given rising inflation. And another reason I read about is the increasing amount of US debt.
Since 2009, stock markets have not corrected to a large extent and hence it seems expected that some investors are waiting for the next financial correction to come, which to them is long overdue.
Personally, notwithstanding the various possible reasons for the next financial correction, I view a financial meltdown of the stock markets definitely likely based on the very simple law of nature: nothing can go up forever, this is the natural cycle and order of life. This is why it is not whether or when stock markets will crash that are important. The thing that is important to me (and I think to many investors) is what will you be doing when the stock markets next crash?
Will you be forced to sell your stocks at deep losses?
Will you be forced to sit through the stock market crash, looking anxiously at the paper losses but at the same time, you do not have the liquidity to buy more stocks which may be at a discount then?
Or will you be very happy indeed after having pared down your investment portfolio in recent years, and now sitting on a pot of large investment warchest. When most investors are fleeing from the stock markets, you are planning which stocks selling at a good discount to purchase with your warchest?
In my opinion, the next stock markets meltdown will be a very good opportunity to build wealth if you are an investor who have been planning to invest in stocks at discounts during the next stock markets crash (like myself). But to be honest, the next stock markets meltdown will also be a painful one as economy, livelihoods and investment portfolio of our fellow community will be affected.
Hence, it is not important on when the stock markets will crash. It is more important that you grab the opportunities in the next stock markets crash! And at the same time, continue to pick up more skills to diversify your job and career opportunities.