About this Video

• Video Title: The Market Crash of your Lifetime‼️
• Channel: Jeremy Lefebvre Makes Money
• Speakers: Jeremy Lefebvre (primarily), other financial news commentators (clips)
• Duration: 00:46:23

Introduction

This video analyzes the recent volatility in the stock market, particularly focusing on whether the recent upward swing marks a market bottom or if further drops are likely. Lefebvre discusses the VIX, put-to-call ratios, and historical NASDAQ data to support his analysis. He also reacts to opinions from other financial experts regarding the current market conditions and whether it's wise to "buy the dip."

Key Takeaways

• Emotional Investing is Costly: The speaker emphasizes the importance of remaining stoic and unemotional when investing, especially for newer investors. Emotional reactions to market fluctuations lead to poor decision-making and financial losses.
• Consistent Buying is Key: The speaker advocates for consistent stock purchases, aiming to buy at the lowest possible prices during market downturns. The focus should be on long-term growth, not attempting to perfectly time the market.
• Market Timing is Ineffective: Trying to perfectly time market entries and exits is generally unsuccessful. Missing even a few of the best market days can significantly reduce long-term returns.
• Use VIX and Put/Call Ratios as Indicators: High VIX values (above 50) coupled with put-to-call ratios of 1 or greater suggest approaching market bottoms, although not necessarily the absolute bottom. This is a long-term historically proven indicator.
• Massive Uncertainty = Buying Opportunities: Periods of significant market uncertainty are historically excellent opportunities for long-term investors to acquire stocks at substantial discounts.

1. Jeremy Lefebvre uses a chart showing the impact of missing the best 10, 20, and 30 days in the market over several decades. He demonstrates how missing these key days significantly reduces overall returns, emphasizing the importance of staying invested. He also uses examples from past market crashes and corrections (2008, 2020, 2022) to highlight the fact that large upward movements don't always signal a market bottom. The example of the best day in NASDAQ history (January 3rd, 2001) followed by a significant drop nine months later is a prime example.

2. The video does not state the precise current VIX and put-to-call ratio values at the time of recording. However, it mentions that the VIX was at 50 the day before the video, and later mentions it’s at 42. The speaker uses the general principle that a VIX above 50 combined with a put-to-call ratio of 1 or above historically indicates proximity to a market bottom, though not necessarily the absolute bottom.

3. The speaker analyzes the largest daily upward changes in NASDAQ history. He uses the example of January 3rd, 2001, which was the best day ever for the NASDAQ, followed by a significant drop nine months later. He also points to October 13th, 2008, and October 28th, 2008, as examples of large up days during the 2008 financial crisis which were not the market bottom. These examples illustrate that large upward movements during bear markets do not automatically signal the end of the downturn.

4. The video clip features a financial expert advising against adding to risk assets due to "tectonic shifts in global trade" and other uncertainties. Jeremy Lefebvre counters this argument by stating that the expert's approach sounds intelligent but is ultimately a foolish strategy. He asserts that consistently buying during market crashes, despite the negative news, has historically been the most profitable approach. He contrasts the seemingly intelligent, cautious approach with the long-term success of buying during periods of high uncertainty.