Morgan Stanley recently announced the outlook for 2019 as “deteriorating”. Think about it. We are in the longest bull market in United States History. Never before has the stock market gone up for 18 straight years. It kills me when people who rode the wave assume knowledge.
In all my years of trading I never learned fundamental strategies that only went long. Profits are made in good markets. Profits are earned in bad markets. Profits can turn to wealth if prudence is applied.
Being rich is having a lot of money in your account. Being wealthy is having continual income that doesn’t run out.
Know the difference.
Personally I prefer $2,000 a month forever versus $100,000 in the account. One has a renewable feature and the other simply depletes. Being wealthy is based on perpetual passive income not high bank account numbers. A Chief Executive Wealth Strategist at Morgan Stanley stated the following, “Recent data points suggest US earnings and economic risk is greater than most investors may think” (Wilson, Michael — Morgan Stanley).
Wilson based this statement on an HIS Markit survey. The survey showed a nine year low in manufacturing. A significant slowdown in the US services sector was also detailed. The US services sector is a huge part of the American economy. The services sector has categories such as health care and business services. Tuesday the stock market sold off and the Dow fell 237 points. The S&P dropped 0.8% during the session. When we combine this data with a $200 billion tariff on Chinese imports (up to 25% from 10%) you start a recipe for US Market Slowdown.
US Market slowdown has been delayed due to technological novelty, money expansion and propaganda. Tools for delay are running out.
Despite the gloomy outlook advantages can be found in any market. When market sentiment dries there is huge opportunity for transactional opportunities. Transactional Opportunities are the Middle Space markets for bear economies. It is at this moment that cash preservation should be enacted. As market sentiment drives earnings down, investors accept a six month old inverted yield curve (a signal we are in a bear market), and banks tighten their capital requirements business opportunities will surface. Options that existed from merchant advances will vanish due to capital losses. Small business will struggle due to option controls. Whoever is wise enough to track these signals, position themselves for opportunity and focus on transactional arrangements will enjoy great wealth accumulation in future years.
My current strategy is focused on taking advantage of technology based FinTech platforms that procure very good returns. With the run I anticipate (over the next eighteen months) a sizable cash reserve should accumulate. From there the focus on tangible assets with transactional risk will be my only concern. The default risk of my payors must be low. The credit worthiness of my payors must be high. Many high earn schemes I will miss but market conditions will dictate caution in coming years.
My advice is simple. My advice is prudent. My advice consists of recognizing trends in markets (both in and out of stock markets). Our current path is evolving rapidly. The condition of conventional market conditions has been combined with acceleration of technology. Thus far technology has managed to preserve overdue recessions. The tools utilized were new concepts (cryptocurrency, block chain, artificial intelligence, electronic P2P systems, et cetera). The same benefit also provides an ironic demise. Technology has advanced life cycles, market cycles and cyclical trends. What use to be a 10 year cycle is a 1 to 2 year cycle. Social media also fueled misconceptions for the largest portion of our working class. The millennials are 75 million strong and compose the majority of our work force.
Millennials were generation zero for technology development. Millennials were fooled into believing millionaires look like social media icons. Millennials were fooled into over consumption to drive corporate profits at expense of their earnings.
The largest wealth transfer in history occurred by Millennials spending it.
A sad proposition for my generation. One that I did not take part in. It is a sad reality that rarely anyone in my age group has one percent of my current net worth. The saddest thing is I am not bill gates. One percent is not that much. Any person savings 10% of modest income over the past 14 years could achieve my networth. Sadly it has not occurred. Millennials are the most likely generation to be worthless high earners (i.e. net worths that are less than $5,000). They earn good money but have no assets. The annual savings rate for millennials is less than 2.0%. My annual savings average is 25.0%.
Generation one (I.E. Generation Z anyone born after 1997) will gain prospective from false pretenses originally sold to Millennials. Technologies such as smart phones, virtual reality, social media, and P2P payments will not be novelty. These features will be reality. When innovation runs its course and technology cannot fool people reality sets in. This reality will be market correction, market reality and fiscal discipline.
To your wisdom success!
About Christopher: Christopher Knight Lopez is a Professional Entrepreneur. Christopher has opened over 7 businesses in his 14-year career. Christopher’s purpose is to take advantage of various market-driven opportunities. Christopher is a certified Master Project Manager (MPM) and Accredited Financial Analyst (AFA). Christopher previously held his Series 65 securities license. Christopher also has his General Lines — Life, Accident, Health & HMO. Christopher has managed a combined 286mm USD in reported Assets Under Management & Assets Under Advisement. Christopher has work experience in 29 countries, raised over 50mm USD for various businesses, and grossed over 7.5mm in his personal career. Christopher worked in the highly technical industries of: biotechnology, finance, securities, manufacturing, real estate, and residential mortgages. Christopher is a United States Air Force Veteran. Christopher has a passion for family, competitive sports, fishing, martial arts and advocacy for entrepreneurs. Christopher provides self-help classes for up-and-coming entrepreneurs. Christopher’s passion to mentor comes from belief that entrepreneurs need guidance. The world is full of conflicting information about entrepreneur identity. See more at www.christopherklopez.com.