The stock market has had three great years of growth, averaging about 18%. The Dow is the highest it has ever been because of these 3 years of exponential growth. Many experts predicted 2015 would hold even greater promise, and at first it did. But recently, our aggressive bull market has stalled, and is creeping into a decline. Over 3 days in August, it dropped 6.3%. This is the first time this year that the stock market has changed more than 3% (which normally happens frequently). So what is causing the recent decline?
There are many different factors going into the stalled performance of the stock market in 2015. The biggest factor is that investors are scared. The Dow started at the highest point it has ever been, how much higher can it realistically go? Especially since the Fed Stopped Quantitative Easing. Some experts are saying that the narrow trading range is from one half of the market being in a downtrend and the other half offsetting it. It is only a matter of time before it breaks. Furthermore, the global economy is in trouble with Greece defaulting on its loans. China, the "economic powerhouse" is going through issues of its own. Finally, the Fed has also said that they will be raising interest rates. All of these factors, along with the 6.3% drop this month, foreshadows a declining market.
Everyone remembers the devastating crash of '08. People went without jobs, had their retirements ruined, along with many other hardships. The economy has been doing well, especially during the past 3 years. However, the economy is not as strong and stable as people want to believe. Many experts are saying we are due for another market correction, and the current events are showing the decline may have already started.
Nobody likes a doomsayer, and I am not trying to scare you, I just want you to be prepared. So my questions for you are: Are you at risk? Can you afford to lose money again? How would that affect your retirement plans? If there was a way you could reap the upside of the market without the downside risk? Would it be worth sitting down and talking about? You can reach us at 865-470-4162.