Is the crash finally here? Is the Stock Market Crashing? [Wealth Daily] Jason Williams / Aug 7, 2024 The Sky is Falling! Dear Reader, After watching [markets fall]( farther and farther, suffering their worst weeks in decades and their worst days in years, itâs not surprising so many people are asking the question, âis the stock market crashing?â The Nasdaq index officially hit correction territory on Monday as itâs now fallen over 12% from its recent peak. The S&P 500 is right behind it, having suffered nearly an 8% drop. The Dow, with less exposure to Big Tech is only down around 6% from its peak. But it just suffered the worst single-day drop since the COVID-crash in 2020. So, is the stock market [crashing](? Or are we just experiencing a typical correction? [is the stock market crashing] Is the Stock Market Correcting? There are arguments to be made in either direction when you pose the question, âis the stock market crashing or is it correcting.â You see, a correction in the stock market is defined as a drop of 10% or more from a recent peak. And a healthy stock market will see, on average, at least two 5% drops and one 10% correction every year. Itâs just how the market works. Itâs like a pendulum swinging back and forth over a center point. It never settles in the middle, but always swings too far to the left and then too far back to the right. Thatâs what you see when thereâs one of these 5% drops or 10% corrections. And that could be what youâre seeing now. Stocks just got too far ahead of themselves. They were pricing in things that didnât pan out the way theyâd expected. People were betting that stocks would only go up. Valuations were getting stretched thin and the entire market was getting overbought. Thatâs prime time for a correction to reset the market back to its trendlines. 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Because, as I wrote a few weeks ago, [leading indicators]( that have accurately predicted every bear market in recent memory are flashing a warning signal. Manufacturing is weak and thatâs another leading indicator of a recession. Plus, consumers are getting pressured more and more. Because even though inflation is slowing, prices are still rising. And pandemic-era savings are nearly gone. Thatâs forcing more people to put day-to-day expenses on credit cards and thatâs leading to an uptick in credit card delinquencies. Small banks havenât seen levels like this ever, and that includes back in 2008/2009 and during COVID: [is the stock market crashing credit] It doesnât paint a pretty picture of a strong consumer. Neither do auto loan delinquency rates. Nor do mortgage delinquency rates. Both of those ticked up higher in the second quarter of 2024. Thereâs no way around it. Americans are carrying more and more debt. And at a time when interest rates are higher than weâre used to, that debt is a lot harder to carry. The U.S. national debt is getting unsustainable, too. This year, interest payments surpassed defense spending to become the largest line item on the federal budget. And at over 120% of GDP, itâs not something we can keep growing without consequences eventually catching up with us. Tell Me What You Really Think Thereâs good reason that this could be the beginning of the end of the good times. But thereâs also plenty of evidence that this could be just a garden-variety correction. And when I ask myself, âis the stock market crashing,â I just canât honestly say that Iâm convinced it is. This all seems like a correction to me. And it seems pretty easy to understand. There were a few crowded trades holding the whole market up. When those started to get too crowded and too highly valued, people started taking profits. When everyone is invested in just a few stocks... And those few stocks make up the majority of indexes like the Nasdaq and S&P 500... A drop in Big Tech means a drop for the markets, even if people are just [rotating out]( of the Magnificent 7 and into the âOther 493.â I donât think we need to worry about a crash coming right now. But I always try to remind myself that the best stock picker in history, Peter Lynch, freely admitted that he couldnât tell you where the next 1,000 points would take us. He just knew that the next 4,000 points were almost certain to take us up. And itâs in times like these that Iâm reminded of something else that famous investor once said. âMarket fluctuations, while no means comfortable, are normal.â [Unlock Your Share of Americaâs]([Ever-Growing $886 Billion Defense Budget]( Seize this opportunity to secure your slice of the massive $886 Billion defense budget with the exclusive, government-backed âPentagon Payoutsâ program. âPentagon Payoutsâ offers the chance for Americans to collect as much as $46,600 a year, courtesy of the constantly growing U.S. military budget. The best part? No military background is required. âPentagon Payoutsâ is open to every tax-paying American, regardless of age or income level. [Getting started with âPentagon Payoutsâ is simple and takes just five minutes.]( The Bottom Line So, there you have the reasons why this market may be crashing, but also my reasons for why this market isnât crashing. And youâve got my personal take on the situation, which is that weâre not in a crash, but even if we are, a decade from now, stock values will be up. And the bottom line here is that, while I could be wrong about the crash, thereâs a 95% chance Iâm right about the next decade: [is the stock market crashing returns] Hopefully you can take some comfort knowing that, on average, stocks usually go up. And the longer you hold them, the more certain those profits become. And maybe you can also take some solace knowing that Peter Lynch, that legendary stock picker who ran a market-beating fund for over 13 years, was fully invested at the start of every major drawdown during that period. Yet he still beat the markets for 13 years running, something Warren Buffett himself said was impossible. So, whether the stock market is crashing or itâs just correcting before heading higher again, if youâre in it for the long-haul, youâre going to make a profit no matter what direction the next 1,000 points take us. Just make sure you keep coming back to [Wealth Daily]( to stay on top of the investment trends that will last for the long run. I and the rest of the team will be back soon with ways you can capitalize on this drop while also protecting yourself from a recession, should one actually come our way. To your wealth, [jason-williams-signature-transparent] Jason Williams [[follow basic] @TheReal_JayDubs]( [[follow basic]Angel Research on Youtube]( After graduating Cum Laude in finance and economics, Jason designed and analyzed complex projects for the U.S. Army. He made the jump to the private sector as an investment banking analyst at Morgan Stanley, where he eventually led his own team responsible for billions of dollars in daily trading. Jason left Wall Street to found his own investment office and now shares the strategies he used and the network he built with you. Jason is the founder of [Main Street Ventures](, a pre-IPO investment newsletter; the founder of [Future Giants](, a nano cap investing service; and authors [The Wealth Advisory]( income stock newsletter. He is also the managing editor of [Wealth Daily](. To learn more about Jason, [click here](. Want to hear more from Jason? [Sign up to receive emails directly from him]( ranging from market commentaries to opportunities that he has his eye on. [Feedback? get in touch](mailto:/newsletter@wealthdaily.com?subject=Wealth%20Daily%20feedback) [Read this email online]( [Manage Newsletters]( [Share on Twitter]( You signed up for our newsletter with the email {EMAIL}.
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