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Make no mistake, there's going to be a stock market crash.
But that doesn't mean you shouldn't be in the market. You absolutely should be.
In fact, being fully invested makes sense. Markets don't crash without giving investors a warning.
Despite the fact we're now more prone to a 1987-style crash than ever, there are strong reasons why you should be invested.
Being on the sidelines while stock markets are regularly making higher highs is a loser's game. Sure, the market can crash, but what if it goes up for another five years and you're still waiting?
Here are what the warning signs will look like and how you can make a quick fortune on the next crash…
How to See a Crash Coming from a Mile Away
No one knows when this raging bull market's going to top out, turn, or crash. And no one should worry about it.
If the market tops out, there'll be plenty of time to take profits and position yourself for whatever's coming next. If the market turns down, it won't happen quickly, and you'll have plenty of time to position yourself for whatever's coming next.
The only thing to be concerned about is a crash because when the market crashes, it happens quickly.
But even that won't happen without warning.
Every major market crash (the panic of 1907, the 1929 crash, Black Monday in 1987, the 2000 tech wreck, and the 2008 crisis) gave investors plenty of warning.
Personally, I had a great day on Oct. 19, 1987. I got completely out of the way of the tech wreck after riding it up, had sold everything, and started shorting stocks in September 2008.
Bubbles are easy to spot, everyone sees them. It's just what you do about them that matters.
The question today is, are we in a bubble? The answer is NO.
All the historical valuation measures of stocks and markets point to them being fully valued, and that doesn't mean they're overvalued or anywhere near bubble territory.
The domestic and global macro view of economic growth is positive. In fact, it's very positive, relative to the past decade of subpar GDP growth.
With the United States and most of the world growing again, there's plenty of room for corporate earnings to improve. Even though stocks may be fully priced, accelerating growth will pad corporate revenue and earnings and keep them from becoming overvalued and entering bubble status.
The big companies leading markets higher, the tech darlings and industrial multinationals, are all capable of expanding their market share and profitability.
When investors look at those companies objectively, they see their extraordinary growth potential and are willing to pay up for their earnings potential. That means earnings per share by multiple measures are high for most of the leading companies, but justifiable if they continue to expand their profitability.
With growing earnings, stocks aren't going to suddenly roll over.
There'll have to be a catalyst, typically an external catalyst, as there always has been preceding a crash.
External catalysts today could include war breaking out with North Korea, a nuclear device being detonated somewhere, a sovereign debt default, a cyberattack on critical infrastructure in the United States, or something that threatens business and commerce.
The buildup and unfolding of a catalyst can usually be seen from a distance and allows investors time to react.
About the Author
Shah Gilani is the Event Trading Specialist for Money Map Press. In Zenith Trading Circle Shah reveals the worst companies in the markets - right from his coveted Bankruptcy Almanac - and how readers can trade them over and over again for huge gains. He also writes our most talked-about publication, Wall Street Insights & Indictments, where he reveals how Wall Street's high-stakes game is really played.