1Semana
The example you described works only in a relatively positive market sentiment. However, it fails to account for the macroeconomic environment. We are already seeing poor labor market data and inflation—once a real recession hits, markets will be heavily affected as there will be no ‘excess’ money left to invest. Under a Trump presidency, I see this recession happening, even though I trust his and Elon Musk’s economic competence. Meanwhile, under Biden and Harris, around 2 million new government jobs were created, making up about 60% of all newly added jobs. Additionally, the 6–7 million (up to 10 million, depending on the source) migrants, 60–70% of whom are illegal, further strain the economy. Elon Musk, with his Department of Governance Efficiency, aims to reduce this oversized government apparatus, which includes well-paid permanent jobs. This would worsen already weak labor market data (more than 80% of published labor data is later revised downward)—e.g., October’s 233,000 jobs figure was revised
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1Semana
@Ph1l1pp I agree with your analysis. I believe it could be, however, an extension of my post. In the example you provided, where the economy is bad and is getting worse, the average investor would not have as much liquidity as they have now, and "buy the dip" will not be a thing anymore. Therefore, a recession or a crash will be even more significant than in the previous few years.
The error in my post is that it's wrong to assume that a recovery will always be faster. This recovery could be delayed if the economic sentiment is not optimistic: Everything is good if all saving plans of X EUR a month continue to have a place in the investment scenario, but if that money is now needed to pay the bills, oh yeah, it will require a long time for the market to recover.
The error in my post is that it's wrong to assume that a recovery will always be faster. This recovery could be delayed if the economic sentiment is not optimistic: Everything is good if all saving plans of X EUR a month continue to have a place in the investment scenario, but if that money is now needed to pay the bills, oh yeah, it will require a long time for the market to recover.
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