Holy Moley…. What Happening
How to Work Less, Earn More & Create Outstanding Wealth
THERE’S EVEN MORE WHEN IT COMES TO THE STOCK MARKET. YOU SEE THE STOCK MARKET SEEMED A BIT HOT WITH SOME LARGE AND UNREALISTIC VALUES, SO A CORRECTION HAD ALREADY STARTED.
It seems every so often Trumpie decides that the world is too calm and needs a bit of excitement.Normally his weapon of choice is tariffs, and he lobs them about like confetti at a happy wedding. Except there is no happy wedding. Just confusion and uncertainty. More divorce than wedding come to think of it.
Anyway, tariffs, cause havoc when it comes to the stock market which results in massive drops in investments. That then make you and me very unhappy. If you are retired or near retirement it also becomes a bit scary as you see your superfund balances blow up.
But this time he has decided that tariffs won’t work when it comes to Iran because, well, Iran doesn’t sell the US anything. And despite US efforts to try to get the world not to buy from Iran they have failed. Miserably.
In December alone Iran exported 1.9 Billion barrels of oil mostly to China, India and Europe.So, what to do? The only thing he can do – bomb them into surrender and take over the oil supply. He will tell you it’s about nuclear weapons and Iran’s instability and so a regime change is required. I’m not so sure.
It’s about oil and he believes bombing is the route he needs to take to get it.
First a bit of history. The western world is terrible when it comes to regime change. That’s because they have no idea who will take over once the guns have stopped. Think Libya. Then Iraq. They stuck a pole up Saddam Hussain and then what happened?
The country fell apart. We stormed into Afghanistan got rid of the Taliban and now look who runs it. Yes, you guessed – the Taliban. In Africa and Pakistan, they work out beforehand that before you decapitate the leader you need a new leader in waiting. The West don’t do that.
Then you have Trump’s ego. He went into Venezuela and they all immediately dropped to their knees and gave up the oil supply agreed to live as slaves. And that made Trump feel he was invincible. Except he is not because the Iranians are not Venezuelans. They are made of stronger stuff.
So, when Trump says he will kill all Iranians they shrug their shoulders and say ‘We don’t care if you kill us but we are going to do make your life hell.’
And that what makes this war different. You cannot negotiate with those willing to die for their cause.
And because America thought it would be easy, they never thought about what happens it if gets hard.Iran has decided it will blast any oil tanker to smithereens they can which means gas and oil cannot leave what is known as the Strait of Hormuz. This then is a catastrophe. And this catastrophe will result in higher aviation fuel and more importantly what we pay for our petrol and diesel. And before all the people with Electric Vehicles start feeling a bit smug, electricity prices will go up too. It’s already started to happen.
And that’s a catastrophe too because higher fuel prices will result in higher inflation which will result in higher interest rates which means higher mortgage payments which then means your pocket is now empty. Not good news.
There’s an additional problem. Stock markets hate bombs as much as they hate tariffs.
So, there are lots of people wailing and running around the room with their arms in the air thinking the world is going to end. All this wailing and gnashing of teeth results in the stock market going bananas and bonkers. Economists become a bit anxious too.
There’s even more when it comes to the stock market. You see the stock market seemed a bit hot with some large and unrealistic values, so a correction had already started.
Last couple of weeks? My portfolio has been a sea of red. Holy Moley it was depressing with falls all over the world as panic selling of stocks saw massive losses across the board.
My kids who keep an eye on their investments saw drops they are not usually used to seeing and feared their house deposits were about to become a McDonalds meal.
Whenever the global political situation becomes unstable everyone fears the worse. They think house prices will collapse, or the entire world will go into recession that will last forever.
So, if you are in that scary space should you really be scared?
Honest answer? I haven’t got the foggiest. Asking me to predict the future is suggesting I have the powers of God. And although I will tell you I am a genius I draw the line at being omnipresent. Or a fortune teller.
One thing I can tell you. If oil prices remain high, we are going to have a problem. A big one.
But here is another thing what I can tell you. History suggests that this scary financial time will even out and become calm.
Think of the Ukraine war. When it started, world stock markets went into meltdown and lead times for supplies became stupid. Oil process went nuts then too. But markets worldwide recovered and went up. When tariffs were announced? Same thing. Recovery and then all-time highs.
Below is a graph of the Australian stock market from 1900 to 2020 which I have extracted from my book The Passport to Wealth and Real Financial Freedom for Business Owners.
