With the stock market ending 2018 with the worst December since the Great Depression, it's not surprising that there are rising fears about the possibility of a stock market crash in 2019.
In December, the S&P 500 officially entered correction territory. The United States has been in the longest-running bull market in history, and this caught many investors by surprise.
With the government shutdown dragging on into its fifth week, investors are wondering if it will lead to a stock market crash in January 2019.
After stocks tumbled 9% in December – one of the worst Decembers since the Great Depression – looking for reassurance is understandable.
Here's what could trigger a market crash, and what you can do to protect yourself...
Last month, the U.S. Federal Reserve announced it would raise interest rates for a third time this year and intended to initiate a fourth raise in the near future.
The Fed's aggressive interest rate tactics rattled concerned investors who believed that regular interest rate hikes could put a sizable dent in their portfolios.
Many investors are convinced that the bull market is over, and there's nothing worth buying at the moment. Worse, they're selling out and heading for the sidelines using even the slightest market drop as justification for their actions.
I can't think of a worse mistake.
There are all kinds of ways to hedge volatility these days. No investor need fear a bear market – let alone suffer the ravages of getting financially mauled.
You can run flat or down markets to your advantage if you are properly prepared, have the right perspective, and have a firm grasp on the right Total Wealth Tactics.
So far we've talked about specific Total Wealth Tactics like LowBall Orders, which you can use to buy the stock you want at exactly the price you're prepared to pay – ideally at a huge discount. We've also covered Position Sizing as a means of limiting risk before you place a trade, Trailing Stops to protect your capital once you're "in," and Free Trades to help you maximize profits when it's time to sell.
Today, I want to introduce a new wrinkle.
I want to show you how to buy more stock without spending more money...
Late last month, I wrote to you about the fact that there is no significant statistical relationship between what happens next in the markets and midterm elections.
And what I had to say started a firestorm.
My email exploded, as you might imagine, with the bulk of the commentary centered on the five most dangerous words in the English language – "It'll be different this time."
Probably not.
But, I'm game.
So, let's continue the conversation by playing this through...
When I started Total Wealth, I highlighted six "Unstoppable Trends" for you and told you that "every dollar you'll make in the next 10 years in on this list."
Not literally, of course, but figuratively.
The six Unstoppable Trends we follow – Demographics, Scarcity/Allocation, Medicine, Energy, Technology, and War, Terrorism & Ugliness – are all driven by trillions of dollars that will get spent practically no matter what happens in the years ahead.
Lining your money up with 'em is the single easiest and most powerful path to profits.
Trade wars… they become somebody else's concern!
Politics… not your worry!
Market corrections… so what!
I know that's hard to accept and even harder to rationalize, so let me put it this way using an old saying you may be familiar with… "A rising tide raises all boats."
Unstoppable Trends are a lot like the tide. Most investors concentrate on the boats – meaning individual companies – with no awareness of what the tide is doing. So, not surprisingly, they're caught when they go aground or collide with an unseen obstacle just beneath the waves.
But get the tide right before you pick your boat?
Now you're going to have a great (and very profitable) sail.
Take War, Terrorism & Ugliness, for example...
Millions of investors are focused, very myopically, on short-term trading at the moment. That's perfectly understandable, but it's a huge mistake in a mid-term election year.
Why?
Because the single biggest risk facing investors today is not that the numbers driving our economy – earnings, jobs, interest rates – collapse, but rather that they're better than "everyone" expects.
Too much "short-termism" results in too many losses, especially at this time of year, when traders are looking to do two things: a) clean house on their portfolios, and b) get in line for big year-end bonuses.
To be sure, the business cycle is long in the tooth; so is the bull market rally. But nowhere is it written in stone that either of those things must come to an end.
Wednesday (Aug. 22) will mark the longest bull market on record.
As we approach nearly a decade of bull market growth, some investors are beginning to wonder if a stock market crash in 2018 is in the making.
Ever wish making money took… less money?
Wish granted.
President Trump just "greenlighted" the 2019 National Defense Authorization Act and a top-line military budget of $717 billion… $616.9 for the Pentagon's base budget, $69.0 billion for overseas contingency operations funding, and a $21.9 billion for nuclear weapons.
That's the single largest investment in our military that I can recall. Not surprisingly, it's also a massive investment opportunity that ties in neatly with one of the single most powerful Unstoppable Trends of our time: War, Terrorism and Ugliness.
We've talked about this extensively over the years, but this is so important that it merits repeating…
… Lining up your money with defense spending will be one of the single most profitable moves you can make in your investing lifetime.
… What's more, doing so plays a huge part in the difference between an investment account that makes money like crazy, and one that falls flat. Or, even worse, one that goes negative.
Case in point, defense-related companies I've recommended like Harris Corp. or Raytheon Co. have led readers in our paid sister services to remarkable profits of 100.81% and 205.19%, respectively… and counting!
The logic is very simple and very compelling...
The Dow is up a meager 2.76% so far in 2018 after exploding for over 240% growth since March 2009.
That sudden slowdown is just one of the factors that has some investors worried about a possible stock market crash in August 2018.
