What a Brutal Bear Market Brings Besides Crashing Stock Prices
“When social mood is negative, rallies, marches and protests become common events”
by Bob Stokes
Updated: April 12, 2022
Sure, it's highly important to get out of value-losing risk assets before the onset of a big bear market.
No analytical method offers a guarantee; however, our experience shows that if you follow the message of the Elliott wave model, you'll have a good chance of protecting your wealth during the next financial downturn.
Having said that, there's more to a severe bear market than collapsing investment prices. Keep in mind that the shift from a positive to a negative social mood -- which brings on a financial bear market -- also brings on an array of societal problems.
Here's what Robert Prechter says in his March Elliott Wave Theorist:
The main social influence of negative social mood is to cause society to polarize in countless ways. That polarization shows up in every imaginable context -- social, religious, political, racial, corporate and by class. The change is a product of the anger that accompanies negative mood, because each social unit seems invariably to find reasons to be angry with and to attack its opposing unit.
With that in mind, Robert Prechter urges Theorist readers to make plans to protect one's physical safety.
This might seem to be an overly dramatic step, but keep in mind that in the wake of every major bear market, major social unrest developed.
A historical example is the worst bear market of the past 100 years -- the one that occurred in the early 1930s. By the way, other financial downturns also occurred later in the 1930s and 1940s. As a result, communists and fascists challenged political institutions. The negative actions which are prompted by an extremely negative social mood usually take time to play out and World War II eventually erupted.
Returning to the latest Theorist, Robert Prechter also mentions the financial downturn of the 1970s, which up to that time, was the worst bear market since the one which started in 1929:
During the 1970s bear market, students challenged police, and blacks challenged whites. In both eras, labor challenged management, and fringe political parties challenged the status quo. When social mood is negative, rallies, marches and protests become common events.
Now, here's what you need to know: If Elliott Wave International's read of the Wave Principle is correct, the next bear market could rival the one of the early 1930s.
That's why the March Elliott Wave Theorist goes into detail on how to prepare for "difficult times." It's written with your financial and physical safety in mind.
Follow the link below to access The Elliott Wave Theorist, which is part of our flagship investor package.
Why Are So Many Investors on the WRONG SIDE of the Market at Major Turns?
Here's why: The news is always negative at major bottoms and positive at major tops.
Hence, many investors expect the negative news to lead to even lower prices, and positive news to lead to even higher prices.
BUT -- the news is not an indicator of future prices -- it's a reflection of the past.
Put yourself on the right side of the stock market's trend by learning what our Elliott wave experts are saying.
Get started by following the link below.
Financial Forecast Service
All month long, Financial Forecast Service helps you stay ahead of the waves in the U.S. markets on the timeframes that matter the most. FFS covers the stock indexes, bonds, gold, silver, the U.S. dollar, as well as market psychology and cultural trends. It is our most popular service.
Comprises the monthly Elliott Wave Financial Forecast, 3x-per-week Short Term Update and at least 12x-per-year Elliott Wave Theorist.
The stock price of Netflix is down a lot and many investors believe the worst of the punishment is over. Yet, when you look at this chart of NFLX's price history, you may reach an independent conclusion.
In early March, gold prices seemed primed to reclaim record highs with a barge of bullish factors floating in its "fundamental" harbor: Looming recession, rate hikes and the ongoing Ukraine war. But instead, that bullish barge sank right alongside a triple-digit decline in price. It's time for an intervention!
We began to cover China's coming real estate debacle as early as July 2017: Now see the chart & forecast, and if U.S. real estate may follow.