The Pandemic Is Spreading and Markets are Crashing
Dear Penny Stock Millionaire,
Today, I want to focus on the coronavirus pandemic and the stock market crash…
Lately, I’m getting TONS of questions and messages from people asking what to do. So I want to share my thoughts about what’s happening.
By now you probably know that pretty much the entire sports world shut down. The NBA suspended its season. The MLB delayed the season start and canceled spring training games. The NCAA canceled March Madness and all other winter sports.
The list goes on … The NHL, ATP, PGA, MLS all delayed or suspended their seasons. NASCAR plans to run races without fans.
And it’s not just sports. Yesterday, Broadway shut down until April 13.
Across the pond, it’s worse…
How Coronavirus Is Shutting Down Europe
I don’t know if you’ve seen what’s happening in Europe. Europe is a tough place to control the coronavirus outbreak. Everyone’s packed so closely together, and there’s a large elderly population.
In Italy, millions of people are on lockdown. Only grocery stores and pharmacies are open. Belgium shut down schools, bars, and restaurants. France shut down schools, universities, and daycare centers. Portugal, Ireland, and Malta closed schools. In Spain, four entire towns are shut down.
Chancellor Angela Merkel told her fellow Germans up to 70% of the population may become infected…
Which is why President Trump announced a travel ban on flights from Europe. But you have to remember this isn’t just about Europe…
Coming to America
The coronavirus is already in America. There are people you know who probably already have it.
So far, there have only been a few dozen deaths in the U.S. And a lot of people out there aren’t taking this seriously. This isn’t something to take lightly.
Too many people say, “Oh, it’s nothing. I’ll just go on with my life.” A lot of people who have the coronavirus don’t know they have it. Plus, there’s a backlog with tests. A lot of people who have it are unknowingly spreading it.
As I write, school districts around America are shutting down. Multiple states including New Mexico, Oregon, and Maryland announced school closings. Seattle — the epicenter of the U.S. outbreak — was the first metropolitan school district to shut down.
Is Coronavirus Really That Bad?
If you do get COVID-19, the good news is the fatality rate is very low — especially if you’re in good health. But if you’re elderly or you have pre-existing health conditions … it gets tricky.
Remember, the 1918 Spanish Flu pandemic killed between 20 and 100 million people. The discrepancy is because the numbers are estimates. Many countries didn’t keep centralized health records at that time.
The Asian Flu pandemic in 1957 had worldwide deaths of between one and four million people. (Again, the numbers are estimates and vary depending on the source.) That number includes roughly 70,000 to 100,000 people in the U.S.
I don’t know if it’ll be that bad as we have modern medicine. But the 1957 pandemic seems to be very similar to what’s happening now.
How Long Will This Last?
I’ll let the virologists make those kinds of predictions. Whether it’s a few days, a few weeks, or a few months depends on how much the virus spreads. It’s still early days if you look at the numbers.
But I can tell you one thing…
As a student of history, I’ve been saying for weeks now that this will have a huge impact on the economy. So it was only a matter of time before…
The Coronavirus Crashed the Stock Market
The stock market is crashing because people got cocky. We were at all-time highs, and, frankly, people thought nothing could bring the market down.
Then we got the virus. Add to that the oil price war between Saudi Arabia and Russia … and that was it. It was a one-two punch that brought the stock market down.
How 2020 Is Different From 2008
This crash isn’t like the financial crisis. That was based on too much leverage in the mortgage market. It turned into an international banking crisis. So fundamentally, this is different. And it’s not really like 1987 or even the great crash of 1929.
How Scary Is the Coronavirus Crash?
I know both the pandemic and the market crash are scary. Especially the pandemic because it’s spreading so fast. It’s the number-one thing we need to fix.
So please don’t treat this like it’s nothing. That’s how too many people get it and then spread it to other people. You don’t want to get this and spread it to other people who then spread it to more people. That’s when it gets really scary.
The stock market crash is also scary. You have to think about what you can do to get through this.
Good News and Bad News
In a few weeks or months, it will be over. That’s the good news. The bad news is… you have to get through it right now.
The State of the Market Crash Address
Make the best of the next few weeks. I know there are a lot of negatives, but there’s a flip side to this.
Again, we don’t know how low the stock market will go. And we don’t know how long this will last. But it will come to an end. In many ways, the crash is a good thing.
You might even see me on Twitter rooting for a financial crash like this tweet from March 6th…
“People ask why I’m so happy when the markets crash, a.) we’re LONG overdue, this is healthy in the long run b.) FAR too many moron bull-market newbies need to be humbled c.) those who downplay deadly viruses like the #coronavirus must be exposed for the dangerous fools they are”
I don’t want the U.S. to go bankrupt or people to lose. But I do appreciate the long-term benefit to the market. Plus, there’s an opportunity to learn. And I love volatility.
And this market is volatile! On Friday afternoon President Trump declared a national emergency. When he paraded a series of big-biz CEOs in front of the cameras, the stock market surged.
The day after the worst day since 2008 became the best day since 2008. In less than half an hour the Dow spiked 1,443 points. The Dow, Nasdaq, and S&P 500 charts look like a penny stock chart.
All this volatility creates…
Massive Trading Opportunities
There are still hot stocks. There are SO many trading opportunities — if you’re prepared.
For example, yesterday was one of the worst days in stock market history. I made a safe and low-risk $3,470. And I’ve been averaging roughly $1,000 per day in profits the past three weeks.
It’s not rocket science. But you have to know where to find…
The Best Opportunities
One of the big problems with the coronavirus pandemic hitting the U.S. is people not taking it seriously. Our political leaders didn’t take it seriously in the beginning. Now reality is sinking in.
But coronavirus plays have been ahead of the game. The past few weeks we’ve seen spikes and full-on supernovas in coronavirus stocks. Which stocks? Here are some examples…
- Vaccine stocks
- Mask stocks
- Coronavirus-testing stocks
- Potential coronavirus-testing stocks
- Disinfectant stocks
And it’s not over. In the coming weeks, these stocks will keep going up and down.
The Economy Will Bounce Back
It’s not a question of if… it’s a question of when. As a trader, the more the stock market crashes, the greater the dip-buying opportunities. Those who prepared are riding the volatility.
Just remember to be safe and take this pandemic seriously. People keep saying, “Stop fear-mongering.”
Sorry — that’s BS. In times like these…
A Little Fear Is Good
My prayers go out to everyone who has coronavirus, their families, and to the entire world. I want this to come to an end as fast as possible. And I hope we all do the right things to end it fast.
But I want to address the apathy. Remember, it’s not about looking good. It’s about staying safe. I think we need more fear right now to make that happen.
To the haters laughing at people for stocking up on toilet paper and water… Seriously? If that’s the extent of our fear, we’re not doing enough.
Washing your hands more often and seeing fewer people — that’s not fear. That’s common sense. If it takes fear to get you to behave differently until this passes over… I think that’s a good thing.
The Virus Is the Enemy
Don’t turn on each other. This is NOT the time to make fun of people for being safe. It’s a time to come together and do the right thing. Each and every one of us.
Here’s what you can do right now…
- Try to limit the number of people you see.
- Limit your travel. (I love to travel, but I’m limiting it for the next few weeks.)
- Wash your hands often and thoroughly.
And study history…
I’m basically a glorified history teacher. I’m not great at math, and I’m not the smartest guy in the world. But I study history. History teaches me to fear this pandemic AND it teaches me that…
Stock Market Volatility Is Your Ally
If … that’s a BIG IF … you’re prepared. If you’re a trader and you’re prepared, take advantage of the volatility and trade opportunities. If you haven’t prepared ahead of time, start studying now. In the meantime…
Stay safe out there. Right now there are no clear answers. We don’t know how to prevent infection from the coronavirus except the standard hygiene recommendations.
Editor, Penny Stock Millionaires