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Will the Market Crash
Again in 2020?
By www.ProfitableInvestingTips.com
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
The stock market started the year strong and then
came the coronavirus pandemic and the market
crashed. The stock market as a whole has
largely recovered from the covid-19 crash. But,
with a weak economy and no substantial
stimulus, will the market crash again in 2020? If
you look at how things played out in the wake of
the 1929 market crash you see that the market
crashed, partially recovered, fell again, and
partially recovered and continued in a downward
course until 1932.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
A major difference between then and now is that
economists and especially the Federal Reserve
realize that the crash turned into the Great
Depression because credit was cut off and the
USA picked a poorly-advised trade war by
passing the Smoot-Hawley Act. Given that the
Fed is “all in” doing whatever it takes to keep
credit flowing, will the market crash again in
2020?
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
Why Is the Stock Market Doing So Much Better
Than the Economy?
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
A few months ago we asked why the stock market
is ignoring the economy. As we noted at that
time, the stock market anticipates the next
moves of the economy. As such it has
discounted airline stocks, hotels, and all tourism-
related businesses among others. And, after a
brief fall in prices, it has not discounted the big
tech stocks which are still leading the market.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
Much of this makes sense in that profits continue
for many tech operations as businesses move
online. What concerns us is that eventually there
needs to be money being spent by ordinary
people to buy things and that is what eventually
supports everything else. As stimulus payments
go away and Republicans in the US Senate wait,
the economy may well be set for a fall and that
could drive the market down.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
Will the Market Crash Again in 2020?
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
If we go back to 1929 we see that there was lots of
optimism along with pessimism as people
bought back into the market and repeatedly
drove prices back up. Unfortunately, the things
that needed to be done in terms of credit and
trade did not happen and the downward course
of stocks went on for three years.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
New Balance says that another crash or at least
large correction, or two, is possible. They look at
other market crashes, their causes, and how in
each case there were partial recoveries and
losses on the way down. These crashes played
out over a couple of years and were typically
exacerbated by a lack of appropriate response
or no response.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
What is unsettling now is the optimism of some
investors or perhaps pigheadedness of some
investors in plowing money into stocks when the
economy is just as likely to weaken as to
improve.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
The 1929 crash was largely played out by 1932
but that is also when Roosevelt came into office
and initiated stimulus programs. With elections
coming up it is possible that a Democratic
majority might take over the US Senate as well
and hold the House of Representatives. And, if
this happens along with a Democrat in the Oval
Office we can expect to see impressive
investments in US infrastructure and US R&D
that could forestall any follow up dips in the
market.
https://profitableinvestingtips.com/profitable-investing-
tips/will-the-market-crash-again-in-2020
For more insights and useful information about
investments and investing, visit
www.ProfitableInvestingTips.com.

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Will the Market Crash Again in 2020?