I've just begun learning about value investing, and I've found that many good stocks are undervalued despite their intrinsic value. If you had $250,000 to create a strong investment portfolio, which stocks would you choose for better returns?
Personally, I would say have a mentor. Not sure where you will get an experienced one, but if your knowledge of the market is limited, it seems like a good bet.
A lot of folks downplay the role of advisors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.
How can I participate in this? I sincerely aspire to establish a secure financial future and i'm eager to participate. Who is the driving force behind your success?
I'm very cautious about giving specific recommendations as everyone's situation varies. Consider independent financial advisors like Teresa L. Teresa I've worked with her for some years and highly recommend her. Check if she meets your criteria.
It seems like we’re hearing more predictions about a potential stock market correction soon. If there’s truth to it, now might be a wise time to re-evaluate the risk exposure in our portfolios, especially with so many sectors facing challenges
The possibility of a market downturn has a lot of people worried. I’m seeing more recommendations to hold cash or look for safe-haven assets, but it’s hard to tell if this is precautionary or a real forecast of things to come.
There are some bearish predictions pointing to a potential dip in tech stocks, which have been strong for so long. This could really shake things up for growth investors if even a portion of those predictions come true
With rising interest rates and debt concerns, a lot of economic forecasts are not very optimistic. Some experts are even calling for a full market reset, which would significantly impact both short-term and long-term plans.
Given the recent volatility, some analysts are warning of a prolonged bear market. It’s a reminder to stay diversified and perhaps consider assets that perform well in uncertain economic conditions, like bonds or commodities
Some forecasters are noting that corporate earnings could take a big hit if consumer spending continues to weaken, especially with higher living costs and debt levels affecting budgets. This could lead to a ripple effect through the market, impacting a lot of different sectors.
It is strange that Warren Buffet claimed, "you should never hold cash, never get out of the market, and nobody can predict the market". Here he is doing the opposite of what he suggested.
His problem is he is very size limited. He has so much money that he literally would move the market in a lot of the individual securities that he's traditionally known for buying. Why he doesn't index more in the s&p 500? Now that's a question I haven't seen anyone ask him that does make a lot of sense
man ....his "cash" delivers 1bn for BH every month lol. Most of the cash is parked in Treasury bills.... He never holds just cash except a percentage to pay unexpected bills...He is a wise person
The problem now is that retirement of literally everyone going to retire from now and forever to come is tied to the stock market. A 17 year period of "no growth" will destroy a hugh portion of 401Ks
Meh, destroyed is a big word. Many of these people will move significant portions of their portfolios into things like dividend funds or the like. Retirees could *never* count on consistent compounding returns over *any* 10-year period in history.
That's a good thing, considering 401Ks enable Vanguard, Blackrock and State Street to gain voting power over every last stock on the market. If money were to withdraw from the market and re-enter later through non 401K means, it would be a great relief for the voting power of normal people.
@@jasonb4770Actually it’s not accurate. I also lived through 1999 ( 2000 ) and 2006 ( 2008 ). During that time I was working and contributing to my 401k. Those periods were the time in which I was able to make the most money by buying low. That is where the real growth comes from.
I have wondered about this but from the standpoint that there is always new money entering the stock market. I wonder if that has changed the old metrics of an over-valued market.
My portfolio of 200k is not increasing any more than 5% and we seem to be facing a massive crash now. I cant tell where the market is headed, or perhaps I should just sell off and avoid the panic.
You have a very valid point, I started investing on my own and for a long time, the market was really ripping me off. I decided to hire a broker, even though I was skeptical at first, and I beat the market by more than 9%. I thought it was a fluke until it happened two years in a row, and so I’ve been sticking to investing via an analyst.
There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Melissa Elise Robinson for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.
For new investors: buy stocks in solid companies and hold them as long as they stay strong. Ignore forecasts and market opinions-they’re distracting at best and useless in the long run.
The key to strong returns isn’t quick-gaining assets but managing risk in relation to reward. It’s about maintaining the right allocation and consistently using your edge to reach your goal. This holds true for everything from long-term wealth building to short-term market plays.
That makes sense. I’ve been using a financial market expert for two years now and I own a six-figure diversified portfolio from investing in stocks. I want to diversify more this year, though.
I'm so happy I made productive decisions about my finances that changed my life forever. I'm 59 living in Melbourne Australia, bought my new mansion in August and hoping to do more if things keep going smoothly for me..
Congratulations dear. You're really doing well for yourself, I'm 51 and my financial life is in a mess. Any great tips would really go a long way in shaping my life. I want to buy my own house, that's really a big flex
If you are not in the financial market space right now, you are making a huge mistake. I understand that it could be due to ignorance, but if you want to make your money work for you...prevent inflation
Good video Hamish, thankyou. The question is, perhaps, what happens to individual shares during the 'flat' periods? At the moment the growth in the S&P is essentially gathered in a handful of companies. So without them, the market would be a lot flatter. Question 2: what happened to dividends over the 'flat' period?
Yeah, I really call the idea into question the idea that US treasuries are ultra safe given just how unsustainable the US debt load is, and just how rapidly it's been adding more and more debt. Either it eventually won't be able to pay off that debt when interest exceeds tax revenue, or your money will be worth next to nothing when they turn on the money printer to make the payments. And I'm saying this as a US citizen.
Real estate prices generally follow the market, which generally follows economic conditions, because all these things relate to how much money people have to spend, and thus how much capital people will have to invest and or buy real estate. The US isn't a very real estate centric economy until recent years. Its historically (and still remains), a consumerist economy. Real estate only effects less than 20% of the GDP (but its recently been growing thanks to high real estate prices).
Good job explaining Buffett's rationale and methodical thinking. As I talk to people who invest it becomes apparent to me that even when people know that it is a long term game and that they need to hold on through the ups and downs...they can't do it. They don't have the stomach or temperament to sit back and watch the show. And even fewer people have the temerity to buy more as the markets and market news headlines become center stage. People think it is easy to buy when the markets are crashing . It isn't!!!
The Bank of England has been around 1694. With the exception of extreme periods (ZIRP - late 1960s - 1980s) interest rates have been in the range of 3 - 5%. It's very unlikely that they will go below 3%.
Recently it was near zero. I'm old enough to remember the inflation of the '70's. What you learn living as long as I have is that surprising things happen.
"If inflation stays around 2%." The debt is over 35 trillion and is increasing by 1T every quarter. The fed's "balance sheet" is over 9T. Gold is over $2700 an oz.
Which means it can move 2 ways. That spending make speople poor due to distortions. Unaffordability crisis affecte the real economy and stocks and gold crash like in 2000... or well any other of these scenarios. Or weget hyperinflation. Pick the one you think is more likely, I for one pick the first, as the US is not indebted in foreign currency.
So if I’m interpreting this right .. There’s basically nowhere for growth to come from. No fuel for the fire. Maybe can cut rates again, but that’s about it.
@@jpcarsmedia Beat me to it. The Question is how fast and to what degree do they implement it. 10 years ago the authors of "People Get Ready" were on C-Span said the German Minister of Industry told them "we could replace 100K high-wage workers (BASF, Siemens, Benz, etc) but we're not going to do it because we don't know what to do with the people". Mercenaries in US now not likely to have such sentiments. Most likely post-election jobs depression followed by some government intervention. Bringing back the WPA would not be bad if it could be managed, trouble is the Democrats turn everything into the Chicago public schools.
How do you feel about Covered call ETFs? I don't have the experience to sell SCHD myself. But I hope the ETF management does. I just really want to know more about these things before investing, only if someone can put me through.
Does anyone know which bank houses his cash? Or if his cash is in TBills, or some foreign bonds? Does anyone know. how to find this information? Thanks.
Unfortunately, not all of us were financially literate early, I was 35 when I finally educated myself and started taking steps. I went from $176,000 in debt with zero savings or retirement to now, 2 years later, fully debt-free and over $1000,000 net worth. I know that doesn't SOUND like a lot, but l'm incredibly proud of it. Now I'm fast-tracking my wealth building (investing $400,000 annually) and don't owe a dime to anyone. It's a good feeling! Thanks Wendy Stewart
What about His Market Indicator. The ratio of total US stock market value divided by GDP is @ 200.2% right now. Indicating that the shoe could drop any time soon ( not that it's going to, that it could ).
I would argue this inflation is different in that the fed *has* to keep rates low to pay off the debt interest and will instead tolerate high inflation. We cannot repeat 18 percent interest without a complete collapse.
Markets are fundamentally a reflection of the activity of people active in that market. If you look at the population curve of that market, you will get a predictor of the activity of that market. All our economic models are viable only in growth mode. The population is aging and the economy will go down.
I feel it's not that appropriate to link returns to US GDP any more, companies are so much more global than they used to be. If the US stagnates and Asia pacific booms, global companies can still grow above US GDP
It's actually more about manipulation by the big players to benefit themselves. Stock prices suffer a distinct drop for no really valid reason, soon followed by a buying spree by the same investors that started the selloff. It's a rigged game and the little guys get the shaft. Kind of like a casino.
not accounting for explosion of index investing. hard to argue for historically benchmarked inflated p/e ratios being an indicator of future depressed returns when $50 billion flows into the s&p a week
The short term treasuries went to 21% and the 30 year went to 15%. General obligation bonds went to I think 14% or more. But you had to watch out for the call dates. How long were you going to get a high rate of return.
pfft, so after all that, Buffet says that the market as a whole has very little impact on his investment decisions because he picks individual companies. I might invest a small amount into indexes, but I'll focus on picking individual stocks which makes all of this concern about the overall market almost irrelevant.
Enjoyed your explanation Hamish. Your analysis fits well with predictions about the likely impact on the overall market if a particular candidate wins the US election. Tariffs on imports will fuel inflation. Inflation will increase bond yields and interest rates overall. That will pull money towards safe/guaranteed returns at a higher yield and drag down the S&P500, if my extrapolation of your historical examples is correct. I understand that this is inductive logic which is subject to failure, but I'd be interested in your take on the likely impact on the market of both outcomes, a T or H win.
@@BuGlobalToday During the last period of sustained inflation (1970s), gold was up 2,300%. Commodities were up 586%. REITs were up 100%. The S&P 500 was flat. But, defensive sectors held their pricing power. Bonds performed very badly!
That's why I'm keeping my powder dry for the moment. I can't see buying into the market at all-time highs - I'll wait for the next disaster and buy the dip - it's the only way I can see to get decent returns over time for the next decade.
@@carlyndolphin I am already in stocks in my 401k, and have been. I'm talking about where to put a newly-acquired war chest of cash. Given the options, stocks is NOT the best choice in 2024.
Keynesian economics works well only in expansions because it does everything we like to see- create new money, stimulate demand for goods and services, bolster the jobs market, generate rising tax bases, foster creativity, etc. In reverse it ushers in the opposite of all those wonderful things, delivering reality to us in the forms of”credit crunches” in multiple manifestations: recessions, depressions, inflation, stagflation, bankruptcy, debt restructure- you name it. Any way you cut it major “adjustments” lie directly ahead.
Nobody invested in stocks in the 60’s and 70’s. People started investing in the mid 80’s. Even more people are investing now than ever as companies no longer use a pension.
Right now for me the best short-term investment is bank deposits with the interest rates of around 7-8% here in Poland. I can dump there very large sums of money, risk-free, instead of buying overvalued assets on the stock market with very high risk, where surely I wouldn't deploy that much capital as well.
7-8% sounds far too good to be true! Be careful…. Remember a bank can freeze your deposits overnight and then collapse. I prefer precious metals in my hand! Buy silver and gold coins on dips. I agree stocks are too risky at the moment. Poland is the safest country in the EU I have read, congratulations on your strong government. We need something similar in the UK.
@@alexandermills382 Thank you for the nice words about my contry. I hope UK bounces back soon. Regarding the bank deposit - right now the average is around 5,5%, a year ago it was around 7-8%, but yesterday I made a deposit with a substantial amount with 7,5% interest rate. There are still some big banks who offer such rates from time to time, and if the timing is right, you can really benefit from it. I think the collapse of such banks is extremely unlikely. There is no 100% safe way to invest, but in the past 2-3 years this has been the best way to invest money for me, given exorbitant prices in the market.
Ask friends and family this question regardless of where you are: Are you struggling financially? The predominant answer i found is YES. Our financial system depends on consumers consuming to sustain growth. I do not see it happening, and i see 2025 as what i describe as a "make or break year" regardless of Buffets cash position or historical advice. Case in point: Tesla stock jumped by over 45 USD in a day last week...this is exuberance above and beyond the norm. I for one believe that the stock market is overvalued and there is too much cash around trying to justify value.
With all of that cash holding... It seems to me that Berkshire is a good hedge purchase. If there's a big drop, do you think you can allocate cash better than Berkshire?
@@HouseofTheRisingFunk Yes... But unlike the SPX, Berkshire is preparing for that collapse with a cash pile. I think Berkshire will be able to put that cash to work better than I could.
Thank you so much for this video but in these uncertain times, it is more important than ever to have a solid understanding of how to manage your finances, invest wisely and navigate economic downturns. But my primary concern is how to grow my reserve of $240k which has been sitting duck since forever with zero to no gains.
Invest in S&P 500 ETF, for as long as possible. Do it as often as you can. Try not to withdraw this money and let compounding do its work. Prioritize patience and a long-term perspective most importantly consider financial advisory for informed buying and selling decisions.
A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.
This is definitely considerable! think you could suggest any professional/advisors i can get on the phone with? i'm in dire need of proper portfoIlo allocation
Viviana Marisa Coelho is her name. She is regarded as a genius in her area and works for Empower Financial Services. By looking her up online, you can quickly verify her level of experience. She is well knowledgeable about financial markets.
The problem with the argument presented in this video is in comparing 1965 to 1981 to the current time doesn't factor in the fact that there are billions upon billions of dollars pouring in from 401(k)s and pension plans that were not there during that original time period. When this money comes in to money managers, they are required to invest that money in the market. So there's a built-in tendency for the market to go up that didn't automatically exist, originally. In addition, the current returns don't seem to reflect previous investment schemes in anyway. No one has a crystal ball. And the way this video attempts to analyze the market is as faulty as any other way. This is the best something to keep in the back of your mind as you plot your way forward. The stock market is overvalued. A serious correction is overdue. So what you should get from this video is the comment about Warren Buffett having a lot of cash on hand. An argument could be made to wait to invest after that correction occurs. The problem of course is timing. Nobody knows when that's coming and nobody knows how much money they're gonna lose by selling too soon. But definitely don't watch a video and think that that should determine your investment plan or get either overly optimistic or overly pessimistic based on it.
Warren Buffet's own market-wide valuation equation (aptly named the 'Buffet Indicator') is currently at the HIGHEST LEVEL EVER (going back 50+ years). And, it is projecting an estimated return of 0.0% over the next seven years. Actual results will likely vary of course, but 0.0% total gains (including dividends) is the baseline projection.
Is the market over valued?? DEFINITELY! But I don’t look at my investing journey as buying something that’s overvalued. I look at it as a way to allocate a percentage of my wealth into highly innovative and valuable businesses that will do well in the long run. Because I invest in an index fund, the best companies get access to most of my wealth.
That’s the problem with successful timing. This exact argument could have been made a year ago and if had been acted on one would have missed out on a great year of returns.
link to the article is in the description :)
When did you hit 200k? Congratulations! Well deserved.
I've just begun learning about value investing, and I've found that many good stocks are undervalued despite their intrinsic value. If you had $250,000 to create a strong investment portfolio, which stocks would you choose for better returns?
Personally, I would say have a mentor. Not sure where you will get an experienced one, but if your knowledge of the market is limited, it seems like a good bet.
A lot of folks downplay the role of advisors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.
How can I participate in this? I sincerely aspire to establish a secure financial future and i'm eager to participate. Who is the driving force behind your success?
I'm very cautious about giving specific recommendations as everyone's situation varies. Consider independent financial advisors like Teresa L. Teresa I've worked with her for some years and highly recommend her. Check if she meets your criteria.
I just curiously Googled her name and her website came up right away. It looks interesting so far. I sent her an email and i hope she responds soon.
It seems like we’re hearing more predictions about a potential stock market correction soon. If there’s truth to it, now might be a wise time to re-evaluate the risk exposure in our portfolios, especially with so many sectors facing challenges
The possibility of a market downturn has a lot of people worried. I’m seeing more recommendations to hold cash or look for safe-haven assets, but it’s hard to tell if this is precautionary or a real forecast of things to come.
There are some bearish predictions pointing to a potential dip in tech stocks, which have been strong for so long. This could really shake things up for growth investors if even a portion of those predictions come true
With rising interest rates and debt concerns, a lot of economic forecasts are not very optimistic. Some experts are even calling for a full market reset, which would significantly impact both short-term and long-term plans.
Given the recent volatility, some analysts are warning of a prolonged bear market. It’s a reminder to stay diversified and perhaps consider assets that perform well in uncertain economic conditions, like bonds or commodities
Some forecasters are noting that corporate earnings could take a big hit if consumer spending continues to weaken, especially with higher living costs and debt levels affecting budgets. This could lead to a ripple effect through the market, impacting a lot of different sectors.
The man is making the biggest market forecast without saying a word
The emperor needs not to speak. His subjects fear his every gesture.
@@afonsodeportugalproductivty crisis, late stage capitalismby design
Most of the markets are controlled by artificial intelligence not the old human panic
@@13thbiosphere interesting thought...
The emperor has no clothes
It is strange that Warren Buffet claimed, "you should never hold cash, never get out of the market, and nobody can predict the market". Here he is doing the opposite of what he suggested.
His problem is he is very size limited. He has so much money that he literally would move the market in a lot of the individual securities that he's traditionally known for buying. Why he doesn't index more in the s&p 500? Now that's a question I haven't seen anyone ask him that does make a lot of sense
He is liar, he does the opposite what he says, like he says I drink 5 cokes daily?
NICE REMINDER TO STAY INVESTED...THANKS. OLD AGE VISITS US ALL
HE ALSO IS LEAVING HIS FAMILY GREAT WEALTH THAT HE PROMISED HE WOULDNT☆
Did you watch the entire video. This is discussed in it.
man ....his "cash" delivers 1bn for BH every month lol. Most of the cash is parked in Treasury bills.... He never holds just cash except a percentage to pay unexpected bills...He is a wise person
The problem now is that retirement of literally everyone going to retire from now and forever to come is tied to the stock market. A 17 year period of "no growth" will destroy a hugh portion of 401Ks
Meh, destroyed is a big word. Many of these people will move significant portions of their portfolios into things like dividend funds or the like. Retirees could *never* count on consistent compounding returns over *any* 10-year period in history.
That's a good thing, considering 401Ks enable Vanguard, Blackrock and State Street to gain voting power over every last stock on the market. If money were to withdraw from the market and re-enter later through non 401K means, it would be a great relief for the voting power of normal people.
Destroyed is accurate. As someone who witnessed 1999 and 2006. This is like watching a rerun.
@@jasonb4770Actually it’s not accurate. I also lived through 1999 ( 2000 ) and 2006 ( 2008 ). During that time I was working and contributing to my 401k. Those periods were the time in which I was able to make the most money by buying low. That is where the real growth comes from.
I have wondered about this but from the standpoint that there is always new money entering the stock market. I wonder if that has changed the old metrics of an over-valued market.
My portfolio of 200k is not increasing any more than 5% and we seem to be facing a massive crash now. I cant tell where the market is headed, or perhaps I should just sell off and avoid the panic.
i'd advise you redistribute assets in your portfolio with the help of a license professional so you don't get burnt in this volatile market
You have a very valid point, I started investing on my own and for a long time, the market was really ripping me off. I decided to hire a broker, even though I was skeptical at first, and I beat the market by more than 9%. I thought it was a fluke until it happened two years in a row, and so I’ve been sticking to investing via an analyst.
This sound interesting. I’m not really one to use pro analysts, but I guess it would not hurt to try one. My portfolio is in the red waters right now
There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Melissa Elise Robinson for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.
She appears to be well-educated and well-read. I ran a Google search on her name and came across her website; thank you for sharing.
Never believe a top investor that has his own priority to manipulate the investors for his own benefit.
For new investors: buy stocks in solid companies and hold them as long as they stay strong. Ignore forecasts and market opinions-they’re distracting at best and useless in the long run.
The key to strong returns isn’t quick-gaining assets but managing risk in relation to reward. It’s about maintaining the right allocation and consistently using your edge to reach your goal. This holds true for everything from long-term wealth building to short-term market plays.
That makes sense. I’ve been using a financial market expert for two years now and I own a six-figure diversified portfolio from investing in stocks. I want to diversify more this year, though.
@@ThomasChai05Impressive can you share more info?
Her name is. ‘IZELLA ANNETTE ANDERSON’. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Thanks for the info, i found her website and sent a message hopefully she replies soon.
Great overall review thanks Hamish!
thank you!!
Excellent!
I'm so happy I made productive decisions about my finances that changed my life forever. I'm 59 living in Melbourne Australia, bought my new mansion in August and hoping to do more if things keep going smoothly for me..
Congratulations dear. You're really doing well for yourself, I'm 51 and my financial life is in a mess. Any great tips would really go a long way in shaping my life. I want to buy my own house, that's really a big flex
If you are not in the financial market space right now, you are making a huge mistake. I understand that it could be due to ignorance, but if you want to make your money work for you...prevent inflation
Always good information Hamish. Thanks bud
Nice research.. thanks
the debt is growing at an alarming pace. Near impossible to lower interest rate given the volume of bond the American gov needs to raise.
Great insights and research
Good video Hamish, thankyou.
The question is, perhaps, what happens to individual shares during the 'flat' periods? At the moment the growth in the S&P is essentially gathered in a handful of companies. So without them, the market would be a lot flatter.
Question 2: what happened to dividends over the 'flat' period?
When you show eg the 66% return over 17 years are you reinvesting the dividends or is this simply comparing the share price index?
Would like to see a us debt factored into the analysis. Printing all that currency has to go somewhere.
It´s called hyper inflation and will come before the year 2030.
Yeah, I really call the idea into question the idea that US treasuries are ultra safe given just how unsustainable the US debt load is, and just how rapidly it's been adding more and more debt. Either it eventually won't be able to pay off that debt when interest exceeds tax revenue, or your money will be worth next to nothing when they turn on the money printer to make the payments. And I'm saying this as a US citizen.
It would be very valuable to see the GDP number minus real estate.
Real estate transactions have been so disjointed, and massively imoact GDP
Real estate prices generally follow the market, which generally follows economic conditions, because all these things relate to how much money people have to spend, and thus how much capital people will have to invest and or buy real estate.
The US isn't a very real estate centric economy until recent years. Its historically (and still remains), a consumerist economy. Real estate only effects less than 20% of the GDP (but its recently been growing thanks to high real estate prices).
Thanks Hamish.
Passive inflows into 401Ks and ETFs would likely mitigate this valuation issue to a large extent ?
It would be awesome to see some content on Milei and argentina. Anyhow your videos are really interesting keep up the good work
Milei is awesome. Wish we had someone like him in the US!
Good job explaining Buffett's rationale and methodical thinking. As I talk to people who invest it becomes apparent to me that even when people know that it is a long term game and that they need to hold on through the ups and downs...they can't do it. They don't have the stomach or temperament to sit back and watch the show. And even fewer people have the temerity to buy more as the markets and market news headlines become center stage. People think it is easy to buy when the markets are crashing . It isn't!!!
Very informative. Subscribed. thanks for posting! :D
So what your sayin is we should have lots of cash reserve so if there is a market crash we can capitalize on the low prices?
Yes, or gold.
Y
No.
Yes
Watch the entire video.
The Bank of England has been around 1694. With the exception of extreme periods (ZIRP - late 1960s - 1980s) interest rates have been in the range of 3 - 5%. It's very unlikely that they will go below 3%.
That is what Buffet said and the rates went to zero.
Recently it was near zero. I'm old enough to remember the inflation of the '70's. What you learn living as long as I have is that surprising things happen.
What are the two variables, I see inly one mentioned which is interest rates
Great video Hamish!
Thanks!
"If inflation stays around 2%." The debt is over 35 trillion and is increasing by 1T every quarter. The fed's "balance sheet" is over 9T. Gold is over $2700 an oz.
Which means it can move 2 ways. That spending make speople poor due to distortions. Unaffordability crisis affecte the real economy and stocks and gold crash like in 2000... or well any other of these scenarios. Or weget hyperinflation. Pick the one you think is more likely, I for one pick the first, as the US is not indebted in foreign currency.
You just warned the stock market could go down over the long term then said people should buy the index for the long term.
So if I’m interpreting this right .. There’s basically nowhere for growth to come from. No fuel for the fire. Maybe can cut rates again, but that’s about it.
Growth is from AI and layoffs
Jpc is correct without AI consumers are broke and done for.
@@jpcarsmedia Beat me to it. The Question is how fast and to what degree do they implement it. 10 years ago the authors of "People Get Ready" were on C-Span said the German Minister of Industry told them "we could replace 100K high-wage workers (BASF, Siemens, Benz, etc) but we're not going to do it because we don't know what to do with the people". Mercenaries in US now not likely to have such sentiments. Most likely post-election jobs depression followed by some government intervention. Bringing back the WPA would not be bad if it could be managed, trouble is the Democrats turn everything into the Chicago public schools.
Do you have a link to that article?
It's now in the description :)
dude, Warren hasn't said anything since 1998?
We've had a few crashes since then...
How do you feel about Covered call ETFs? I don't have the experience to sell SCHD myself. But I hope the ETF management does. I just really want to know more about these things before investing, only if someone can put me through.
Does anyone know which bank houses his cash? Or if his cash is in TBills, or some foreign bonds? Does anyone know. how to find this information? Thanks.
Excellent video, thank you 😊
Unfortunately, not all of us were financially literate early, I was 35 when I finally educated myself and started taking steps. I went from $176,000 in debt with zero savings or retirement to now, 2 years later, fully debt-free and over $1000,000 net worth. I know that doesn't SOUND like a lot, but l'm incredibly proud of it. Now I'm fast-tracking my wealth building (investing $400,000 annually) and don't owe a dime to anyone. It's a good feeling! Thanks Wendy Stewart
I'm surprised that you just mentioned and recommended Wendy Stewart, I met her at a conference in 2018 and we have been working together ever since.
The very first time we tried, we invested $2000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
You trade with Wendy Stewart too? Wow that woman has been a blessing to me and my family
I'm new at this, please how can I reach her?
she's mostly on Instagrams, using the user name
What about His Market Indicator. The ratio of total US stock market value divided by GDP is @ 200.2% right now. Indicating that the shoe could drop any time soon ( not that it's going to, that it could ).
love these videos, keep em coming
Thank you for being a long-time subscriber of the channel!
I would argue this inflation is different in that the fed *has* to keep rates low to pay off the debt interest and will instead tolerate high inflation. We cannot repeat 18 percent interest without a complete collapse.
I am coder but very vey interested in financial world and investing, i need to learn more and more. Your videos help me a lot.
He sold banks because they are short silver and will collapse soon
Lol "billions" in losses of the 5 largest banks will lead to their total collapse.
That's such a tiny fraction of their equity.
So it's his past prediction, not his current prediction? If correct, what is value add of this podcast?
Markets are fundamentally a reflection of the activity of people active in that market. If you look at the population curve of that market, you will get a predictor of the activity of that market. All our economic models are viable only in growth mode. The population is aging and the economy will go down.
thank you for doing such thorough research ,love it
My AI Buffett used in the intro needs some work... 😆
The voice is scarily good - which AI tool do you use for this?
I thought buffet actually said this 😂😂😂
Had me fooled
If this holds up, stockpicking will become more important in the next years.
I feel it's not that appropriate to link returns to US GDP any more, companies are so much more global than they used to be. If the US stagnates and Asia pacific booms, global companies can still grow above US GDP
The stock market does not reflect the value of businesses anymore, it is now mostly to do with the value of the dollar.
No, There is something else that is a big secret here. Clue: Modern Munger and Warren think it is rat poison. Really!
It's actually more about manipulation by the big players to benefit themselves. Stock prices suffer a distinct drop for no really valid reason, soon followed by a buying spree by the same investors that started the selloff. It's a rigged game and the little guys get the shaft. Kind of like a casino.
I love you Hamboy!
not accounting for explosion of index investing. hard to argue for historically benchmarked inflated p/e ratios being an indicator of future depressed returns when $50 billion flows into the s&p a week
This is an article from 1999, how could you expect this to apply to today's world that changed a lot !
The short term treasuries went to 21% and the 30 year went to 15%. General obligation bonds went to I think 14% or more. But you had to watch out for the call dates. How long were you going to get a high rate of return.
what should you have invested in from 65 to 85?
Now I have recovered 90% of my lost money may Allah keep blessing her for me ❤
Thank-you Hamish.
pfft, so after all that, Buffet says that the market as a whole has very little impact on his investment decisions because he picks individual companies. I might invest a small amount into indexes, but I'll focus on picking individual stocks which makes all of this concern about the overall market almost irrelevant.
What article was this in which magazine? Fortune 500 or _____ magazine
Great video. The best you’ve posted in a while, Hamish. Well done.
Brilliant Hamish - great piece
Enjoyed your explanation Hamish. Your analysis fits well with predictions about the likely impact on the overall market if a particular candidate wins the US election. Tariffs on imports will fuel inflation. Inflation will increase bond yields and interest rates overall. That will pull money towards safe/guaranteed returns at a higher yield and drag down the S&P500, if my extrapolation of your historical examples is correct. I understand that this is inductive logic which is subject to failure, but I'd be interested in your take on the likely impact on the market of both outcomes, a T or H win.
Buying Stocks or Gold are the absolute best hedges against hyperinflation.
Absolutely. Historical patterns show that both beat bonds and cash during the 70s.
Not true
@@BuGlobalToday During the last period of sustained inflation (1970s), gold was up 2,300%. Commodities were up 586%. REITs were up 100%. The S&P 500 was flat. But, defensive sectors held their pricing power. Bonds performed very badly!
No, There is something else that is a big secret here. Clue: Modern Munger and Warren think it is rat poison. Really!
A lot of similarities covered in this video. Debt to GDP wasn’t 130% during that time frame.
Great video! You deserve much,much more than 200K subscribers.
That was a fantastic video. I always enjoy looking for your new videos, but this one was the best!
That's why I'm keeping my powder dry for the moment. I can't see buying into the market at all-time highs - I'll wait for the next disaster and buy the dip - it's the only way I can see to get decent returns over time for the next decade.
The next few years will certainly be interesting, thanks for watching!
1000% Believe the same thing.. This is the biggest bubble in the history of this over 100 to 110 year old Fiat currency.
The last 2 years you have lost out on 60% gains! Good luck on timing the market though.
@@carlyndolphin I am already in stocks in my 401k, and have been. I'm talking about where to put a newly-acquired war chest of cash. Given the options, stocks is NOT the best choice in 2024.
@@JohnPamplin invest in your own business. That's the biggest return you can get in the next 17 years
Your analisis are amazing.
S/P 500 index or ETF. Time in market not timing the market.
According to the Buffet indicator, S&P is over valued by 63-65% now, so expect that pull back and then you can say that you bought at real valuation.
Great video
Time to buy then.
I take money out of stocks every month that there's a new high.
Keynesian economics works well only in expansions because it does everything we like to see- create new money, stimulate demand for goods and services, bolster the jobs market, generate rising tax bases, foster creativity, etc. In reverse it ushers in the opposite of all those wonderful things, delivering reality to us in the forms of”credit crunches” in multiple manifestations: recessions, depressions, inflation, stagflation, bankruptcy, debt restructure- you name it. Any way you cut it major “adjustments” lie directly ahead.
Buffett really is the goat, I wonder if he’ll be going into commodities now
Nobody invested in stocks in the 60’s and 70’s. People started investing in the mid 80’s. Even more people are investing now than ever as companies no longer use a pension.
In late 1970 early 1980 a CD was close to 21% interest.
It was only vinyl and cassette tapes in the late 70s.
But you can trade stocks using leverage. I mean 3,5 percent is nice when you have millions.
Right now for me the best short-term investment is bank deposits with the interest rates of around 7-8% here in Poland. I can dump there very large sums of money, risk-free, instead of buying overvalued assets on the stock market with very high risk, where surely I wouldn't deploy that much capital as well.
7-8% is pretty damn good! thanks for watching :))
@@HamishHodder Isnt it! Cheers, thank you for great conent
7-8% sounds far too good to be true! Be careful…. Remember a bank can freeze your deposits overnight and then collapse. I prefer precious metals in my hand! Buy silver and gold coins on dips. I agree stocks are too risky at the moment. Poland is the safest country in the EU I have read, congratulations on your strong government. We need something similar in the UK.
@@alexandermills382 Thank you for the nice words about my contry. I hope UK bounces back soon. Regarding the bank deposit - right now the average is around 5,5%, a year ago it was around 7-8%, but yesterday I made a deposit with a substantial amount with 7,5% interest rate. There are still some big banks who offer such rates from time to time, and if the timing is right, you can really benefit from it. I think the collapse of such banks is extremely unlikely. There is no 100% safe way to invest, but in the past 2-3 years this has been the best way to invest money for me, given exorbitant prices in the market.
Banks deposit insurance?
Where can someone get this article to read?
It's now in the description :)
@@HamishHodder Awesome. Thanks🙏
Ask friends and family this question regardless of where you are: Are you struggling financially? The predominant answer i found is YES. Our financial system depends on consumers consuming to sustain growth. I do not see it happening, and i see 2025 as what i describe as a "make or break year" regardless of Buffets cash position or historical advice. Case in point: Tesla stock jumped by over 45 USD in a day last week...this is exuberance above and beyond the norm. I for one believe that the stock market is overvalued and there is too much cash around trying to justify value.
You might have to become a value investor and focus on dividend paying options: like VOO @ 45% and FDVV @ 55%.
10:40 A 6.3% increase in the S&P 500 over 17 years relative to inflation is still waaaay better that you would do if you held plain cash
Flat for two 25/26 …mini bull peaking at 2030… stay invested and go and get a hobby till 2030 do not be tempted until 27
I think a lot more people bought bonds instead of stocks during the 70s
I bought a stock because Warren Buffet bought it. It now is a big red.
At some point PEs will go sub 15x. That bodes very badly for stock the next decade.
You will note modern pension plans came in over that period which has fueled the market.
Thanks for an interesting video 🙂
The bonds are not risk free, they are risk (of purchasing power) guaranteed. Hello .....
With all of that cash holding... It seems to me that Berkshire is a good hedge purchase.
If there's a big drop, do you think you can allocate cash better than Berkshire?
a single share is the cost of a house. and iirc invite only
@@Joe-sg9ll There is Berkshire Class A... and Class B.
Class B is currently $457.
Berkshire will hold up longer than than the SPX but will eventually collapse just like everything else just not as much.
@@HouseofTheRisingFunk Yes... But unlike the SPX, Berkshire is preparing for that collapse with a cash pile.
I think Berkshire will be able to put that cash to work better than I could.
@@haze1123 I agree. I own shares of Berkshire. I have studied their history extensively which has led me to such conclusion.
Ive seldom seen this many scam comments just sitting in the comment section. --_-- It really goes downhill with scam comments and bots.
Thank you so much for this video but in these uncertain times, it is more important than ever to have a solid understanding of how to manage your finances, invest wisely and navigate economic downturns. But my primary concern is how to grow my reserve of $240k which has been sitting duck since forever with zero to no gains.
Invest in S&P 500 ETF, for as long as possible. Do it as often as you can. Try not to withdraw this money and let compounding do its work. Prioritize patience and a long-term perspective most importantly consider financial advisory for informed buying and selling decisions.
A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.
This is definitely considerable! think you could suggest any professional/advisors i can get on the phone with? i'm in dire need of proper portfoIlo allocation
Viviana Marisa Coelho is her name. She is regarded as a genius in her area and works for Empower Financial Services. By looking her up online, you can quickly verify her level of experience. She is well knowledgeable about financial markets.
Run! Panic! Buy Gold!
Let me make a prediction: Berkshire will have more money in cash in 2025. And 2026. And 2027. And 2028. But not 2029!
Will not crash will have a big rise in coming months
It's only alarming for people who want to retire in 10 years, for everybody else who's accumulating it's perfect for stocks to be flat.
Unfortunately, I'm retiring in 6 years.
The problem with the argument presented in this video is in comparing 1965 to 1981 to the current time doesn't factor in the fact that there are billions upon billions of dollars pouring in from 401(k)s and pension plans that were not there during that original time period. When this money comes in to money managers, they are required to invest that money in the market. So there's a built-in tendency for the market to go up that didn't automatically exist, originally.
In addition, the current returns don't seem to reflect previous investment schemes in anyway. No one has a crystal ball. And the way this video attempts to analyze the market is as faulty as any other way. This is the best something to keep in the back of your mind as you plot your way forward.
The stock market is overvalued. A serious correction is overdue. So what you should get from this video is the comment about Warren Buffett having a lot of cash on hand. An argument could be made to wait to invest after that correction occurs. The problem of course is timing. Nobody knows when that's coming and nobody knows how much money they're gonna lose by selling too soon.
But definitely don't watch a video and think that that should determine your investment plan or get either overly optimistic or overly pessimistic based on it.
It's common sense that all that printed money will eventually find its way into the market... why do most people over analyze this fact?
If the dollar crashes from BRICs currency, the value of that cash will shrink fast.
Buffet plays the game the other way around doing what 99% doesnt do. Thats why he is successfull. But people cant do what he does...
sell stocks , work for a living, be economically productive. your economy/country needs you.
Warren Buffet's own market-wide valuation equation (aptly named the 'Buffet Indicator') is currently at the HIGHEST LEVEL EVER (going back 50+ years). And, it is projecting an estimated return of 0.0% over the next seven years. Actual results will likely vary of course, but 0.0% total gains (including dividends) is the baseline projection.
Is the market over valued?? DEFINITELY!
But I don’t look at my investing journey as buying something that’s overvalued. I look at it as a way to allocate a percentage of my wealth into highly innovative and valuable businesses that will do well in the long run.
Because I invest in an index fund, the best companies get access to most of my wealth.
The market is up 30% from just 1 year ago. What would this video say if it was made just 1 year ago?
Exactly - 1 year of -22% or +33% changes the long term return quite a bit
That’s the problem with successful timing. This exact argument could have been made a year ago and if had been acted on one would have missed out on a great year of returns.