1 00:00:00,009 --> 00:00:03,432 History doesn't repeat, but it rhymes. The longer the bull market goes for, 2 00:00:03,672 --> 00:00:07,095 the worse the crash is. If you're not totally leveraged and 3 00:00:07,115 --> 00:00:10,298 you've got multiple income streams, you're prepared for the worst. Worst thing you can do 4 00:00:10,358 --> 00:00:14,041 is panic to the point where you sell at the bottom. I'm Lloyd James Ross, seven-figure 5 00:00:14,081 --> 00:00:17,344 investor and entrepreneur, and I've helped thousands of business owners and 6 00:00:17,384 --> 00:00:20,607 professionals turn financial stress into success. If 7 00:00:20,627 --> 00:00:23,969 you're stuck in old money habits, overwhelmed by investing, or unsure where 8 00:00:23,989 --> 00:00:27,292 to start, This is for you. I'll give you the mindset and 9 00:00:27,352 --> 00:00:31,114 strategies to take control, grow your wealth, and achieve financial 10 00:00:31,214 --> 00:00:34,556 freedom. It's time to make your money work for you. Stock 11 00:00:34,596 --> 00:00:38,538 markets are crashing! Again, headlines are screaming, panic's rising! 12 00:00:38,798 --> 00:00:42,200 Or is it? What you may not realize is we didn't go through a stock market crash 13 00:00:42,360 --> 00:00:45,602 in the last few weeks of March 2025. We've actually just 14 00:00:45,642 --> 00:00:48,864 gone through a correction. Either which way, most people are making the 15 00:00:48,925 --> 00:00:52,888 same mistake they always do. They react emotionally. But 16 00:00:52,908 --> 00:00:56,290 here's the truth, this isn't new. So in this episode, I'm 17 00:00:56,310 --> 00:00:59,713 gonna show you what most people are missing and why history might 18 00:00:59,773 --> 00:01:03,376 just be repeating itself in the worst or best way 19 00:01:03,696 --> 00:01:07,058 possible. So let's get into it. This is all about stock 20 00:01:07,179 --> 00:01:10,421 market crashes. And so what people don't realize is 21 00:01:10,581 --> 00:01:13,684 that it does happen quite a bit. But before we 22 00:01:13,724 --> 00:01:17,068 jump into the episode, I want to explain a couple of things to you. There are three types 23 00:01:17,108 --> 00:01:20,452 of market collapses that happen. The very first one is called 24 00:01:20,532 --> 00:01:24,416 a correction. And that's when the market falls by about 10%. The next 25 00:01:24,536 --> 00:01:29,662 one where the market falls by 20% is called a bear market. Why 26 00:01:29,682 --> 00:01:32,984 do they call it a bear market? Because the bear swipes his hand downwards as 27 00:01:33,024 --> 00:01:36,067 he attacks. And that's why they call it a bear market. The reason they call it a 28 00:01:36,187 --> 00:01:39,309 bull market when the market goes up by 20% is because as the 29 00:01:39,349 --> 00:01:42,831 bull attacks, its horns go upwards. That's why there's a bull on 30 00:01:42,891 --> 00:01:46,274 Wall Street. So that's where you get bear market and bull market from. 31 00:01:46,394 --> 00:01:49,856 So it's got to move 20% to be a bear market down, 20% up to 32 00:01:49,896 --> 00:01:53,338 be a bull market. But then of course, there is a crash. And 33 00:01:53,358 --> 00:01:57,021 a crash is when the market falls by 30% or 34 00:01:57,061 --> 00:02:00,143 more. And believe it or not, that has happened quite a bit. So in 35 00:02:00,163 --> 00:02:03,505 this episode, I'm going to go through a market history and 36 00:02:03,645 --> 00:02:06,807 show you and explain to you when the market has collapsed by 37 00:02:06,947 --> 00:02:10,048 30% or more and the reasons behind it so that you 38 00:02:10,088 --> 00:02:13,991 can see it coming maybe in the future. But most importantly, you 39 00:02:14,031 --> 00:02:17,393 can actually leverage it and use 40 00:02:17,453 --> 00:02:20,679 it to your advantage. Let's go back to the most 41 00:02:20,739 --> 00:02:24,060 recent one. Before we dive into the big, big, big ones, let's go back 42 00:02:24,160 --> 00:02:27,642 to the most recent. In fact, let's go right back in 43 00:02:27,702 --> 00:02:31,264 time to 1987. In 1987, there 44 00:02:31,284 --> 00:02:35,675 was a flash crash and they called it Black Monday. And 45 00:02:35,715 --> 00:02:38,957 it's where the stock market collapsed by, geez, I think the 46 00:02:38,997 --> 00:02:42,620 Dow fell by about 20% in a single day. And it's where all the stockbrokers 47 00:02:42,680 --> 00:02:46,162 were actually jumping off buildings, because there was a lot of leverage in the market, and 48 00:02:46,182 --> 00:02:49,664 there was a flash crash. Now, it wasn't a long, drawn-out crash, 49 00:02:49,704 --> 00:02:52,887 but the market fell by a lot in 1987, and 50 00:02:52,967 --> 00:02:56,389 more than it had before. And it really came after a big, long 51 00:02:56,449 --> 00:02:59,711 bull market. And so it took everyone by surprise. And so 52 00:02:59,751 --> 00:03:03,113 that was a fairly famous crash in the stock market, 53 00:03:03,574 --> 00:03:07,459 but it was nothing compared to what was going to happen in the year 2000 because 54 00:03:07,640 --> 00:03:10,744 after the crash of 1987 The world entered one 55 00:03:10,764 --> 00:03:13,986 of the greatest bull markets in history, and 56 00:03:14,006 --> 00:03:17,488 it was the roaring 90s. And in this period of time, the 57 00:03:17,528 --> 00:03:20,710 likes of the Wolf of Wall Street was in full flight, okay? So 58 00:03:20,730 --> 00:03:24,273 this is where everyone was making money, hand over fist, and 59 00:03:24,493 --> 00:03:28,075 yeah, greatest bull market run ever. In fact, I don't think they had a stock market correction 60 00:03:28,155 --> 00:03:31,878 or any backwards movement for a year for like almost 10 straight 61 00:03:31,918 --> 00:03:35,320 years. So it was like, make money, make money, make money. 62 00:03:35,640 --> 00:03:38,862 And the longer the bull market goes for, the worse the 63 00:03:38,922 --> 00:03:43,966 crash is. So in the year 2000, 1999, 2000, one 64 00:03:43,986 --> 00:03:47,548 of the greatest crashes ever happened. And it's been coined 65 00:03:47,848 --> 00:03:51,151 the dot-com bubble. And here's how it happened. So 66 00:03:51,191 --> 00:03:54,453 on the back of the 90s bull run, a lot of tech companies were 67 00:03:54,473 --> 00:03:58,636 starting to come into fruition. And tech companies were developed 68 00:03:58,676 --> 00:04:01,938 because this new incredible technology was invented called 69 00:04:01,978 --> 00:04:06,461 the internet. And so it took the world by storm, right? flipping 70 00:04:06,481 --> 00:04:09,882 the way that we communicate is a little bit like what AI is doing right now. It's 71 00:04:09,922 --> 00:04:13,362 completely transforming the world. It's like it moved us from the industrial age 72 00:04:13,442 --> 00:04:16,663 into the information age. And so all these new companies were popping up. 73 00:04:17,103 --> 00:04:20,164 Like, where are the internet? Where are the toy store on the internet? Where are 74 00:04:20,224 --> 00:04:23,444 pets.com on the internet? Like, all these businesses were moving to 75 00:04:23,464 --> 00:04:26,685 the internet. And of course, some wonderful companies were created back 76 00:04:26,725 --> 00:04:30,026 then, like Amazon and some other awesome online businesses at 77 00:04:30,046 --> 00:04:33,528 the time. that were legitimate businesses. But the reality 78 00:04:33,568 --> 00:04:37,012 is a lot of them were illegitimate businesses, meaning they were businesses 79 00:04:37,052 --> 00:04:40,235 that weren't actually earning any money. So back then, 80 00:04:40,255 --> 00:04:43,858 what you could do is you could get a URL, you could call yourself this business, you 81 00:04:43,878 --> 00:04:47,121 say you're a tech company, and boom, you have all this backing, all this capital would 82 00:04:47,141 --> 00:04:50,485 go to you, you could go and list on the stock exchange, and all of a sudden, everyone will 83 00:04:50,505 --> 00:04:53,707 pour their money into your business. But unfortunately, It wasn't making any money. 84 00:04:54,107 --> 00:04:57,869 So eventually after this hype, right, zero 85 00:04:57,929 --> 00:05:01,210 fundamentals, zero reasons to own these businesses, but they were doing 86 00:05:01,250 --> 00:05:04,431 it because they didn't want to miss out. And he was even pulling in some of the pros, right? So 87 00:05:04,872 --> 00:05:08,193 almost no one escaped this except for the likes of my hero Warren 88 00:05:08,233 --> 00:05:11,474 Buffett that told everyone at a Sun Valley event that this 89 00:05:11,494 --> 00:05:16,716 was very much like cars back in the year 1920. It's 90 00:05:16,756 --> 00:05:20,378 new technology, like the railroads, like Chula Bolt, like he'd 91 00:05:20,418 --> 00:05:23,861 seen this before. This wasn't new. So he said to everyone, we're 92 00:05:23,881 --> 00:05:27,323 sitting out of this one. And of course, everyone thought he'd lost his mind because if 93 00:05:27,343 --> 00:05:31,065 you don't get in, you miss out, you don't know what you're doing. And all the headlines would say, Warren Buffett's 94 00:05:31,165 --> 00:05:34,407 lost the plot. And so then eventually what happened was 95 00:05:34,427 --> 00:05:38,872 this, people discovered that they weren't earning any money. And 96 00:05:38,912 --> 00:05:42,234 eventually, everyone started to sell. And they sold them. 97 00:05:42,334 --> 00:05:45,635 And no one wanted to hold the hot potato. So everyone was like, I don't want to, I don't want to. And the whole 98 00:05:45,775 --> 00:05:49,477 market in the year 2000 absolutely collapsed, falling 99 00:05:49,777 --> 00:05:53,439 more than 30% very quickly. It was one of the sharpest, 100 00:05:53,579 --> 00:05:57,121 worst declines in stock market history. In fact, it was so bad 101 00:05:57,561 --> 00:06:00,802 that a lot of those, the stock market and the NASDAQ, where all those 102 00:06:00,842 --> 00:06:04,484 tech companies live on the stock exchange, the NASDAQ, It 103 00:06:04,524 --> 00:06:08,529 didn't recover its peak dot-com 104 00:06:08,549 --> 00:06:11,792 bubble hype for like 14 years. So 105 00:06:11,812 --> 00:06:15,336 if you had a board at the peak of the market, you had to wait 14 years to get back 106 00:06:15,376 --> 00:06:18,419 to where you were. So it was very bad. It 107 00:06:18,439 --> 00:06:21,623 was a massive crash. A lot of people lost a lot of money. In fact, in those 108 00:06:21,643 --> 00:06:24,765 days, you could buy Amazon for $6 a share. So some of 109 00:06:24,785 --> 00:06:28,666 the best businesses got thrown out with the baby got thrown out with the bathwater. But 110 00:06:28,886 --> 00:06:32,067 without a doubt, it taught us so many financial lessons, like just because there's a 111 00:06:32,107 --> 00:06:35,347 new technology in town, doesn't mean that those things are 112 00:06:35,407 --> 00:06:38,848 worth anything. And it's very similar to what's happening in crypto. It's 113 00:06:38,948 --> 00:06:42,349 very similar to what's happening in AI. Just because the technology is 114 00:06:42,429 --> 00:06:45,729 cool, does not make the thing that you're buying cool or 115 00:06:45,789 --> 00:06:49,070 effective. So there's a word of warning. And this has happened before. All 116 00:06:49,090 --> 00:06:52,991 right. So again, happened with railroads, happened with cars, happened 117 00:06:53,011 --> 00:06:56,223 with Internet, happening with crypto, happening with AI, 118 00:06:56,324 --> 00:07:00,106 it's gonna happen forever, right? So just be careful of that. Now, what 119 00:07:00,226 --> 00:07:03,889 is the crash that came after the dot-com bubble and after the 1987 crash? 120 00:07:04,489 --> 00:07:07,951 Well, if we look forward, what happened from that point on was the market 121 00:07:08,011 --> 00:07:11,894 corrected and things were going fairly well again. So in the early 2000s, 122 00:07:12,334 --> 00:07:15,516 the dot-com bubble had collapsed. A lot of the tech companies got hammered, but 123 00:07:15,536 --> 00:07:18,838 a lot of other businesses like banks and traditional businesses kept doing 124 00:07:18,918 --> 00:07:22,893 well. But what happened was this. everyone 125 00:07:23,033 --> 00:07:26,377 thought that the property market could never 126 00:07:26,417 --> 00:07:29,821 go backwards. And so a simple idea is 127 00:07:29,881 --> 00:07:33,426 that land over time appreciates and property grows steadily 128 00:07:33,486 --> 00:07:37,371 over time. And that was a wonderful, simple concept that didn't 129 00:07:37,391 --> 00:07:40,895 get taken for granted, didn't get pushed to the didn't 130 00:07:40,935 --> 00:07:44,619 push the envelope on it. It was just the steady flow of things. But 131 00:07:44,799 --> 00:07:48,063 then what happened was someone realized, oh, probably doesn't go 132 00:07:48,123 --> 00:07:51,267 backwards. Why don't we just leverage up and start buying more 133 00:07:51,307 --> 00:07:54,591 properties than we could possibly afford because we're going to get loans from 134 00:07:54,611 --> 00:07:58,034 the banks and they're going to lend us the money to buy all these properties. 135 00:07:58,275 --> 00:08:02,575 Now, here's the thing. At the same time, The 136 00:08:02,675 --> 00:08:06,757 banks were actually lending money to 137 00:08:06,817 --> 00:08:10,439 these people to buy property because they also thought the property didn't go backwards 138 00:08:10,479 --> 00:08:13,721 or down. And they were lending them to people with no jobs and 139 00:08:13,781 --> 00:08:16,843 no income. They called them ninja loans. And if you ever watched the 140 00:08:16,863 --> 00:08:20,285 movie The Big Short, they talk about these things called the ninja loans. And 141 00:08:20,305 --> 00:08:23,346 so these brokers from the banks, in fact, the Wolf of Wall Street was also doing it at 142 00:08:23,366 --> 00:08:26,668 the same time. He was selling mortgages then as well. They 143 00:08:26,688 --> 00:08:29,791 were selling these mortgages to people that really couldn't afford it. And if 144 00:08:29,831 --> 00:08:33,294 you watch the movie, they were actually selling like five properties to strippers 145 00:08:33,634 --> 00:08:36,877 who actually didn't have the cash flow to fund any of those property 146 00:08:36,917 --> 00:08:40,080 investments if interest rates went back up. So there was a couple of things 147 00:08:40,120 --> 00:08:43,923 happening at once. One, people thought property never went backwards. Two, banks 148 00:08:43,943 --> 00:08:47,566 were lending to people that shouldn't have been borrowing money. And three, they 149 00:08:47,606 --> 00:08:50,889 were borrowing the money on these things called teaser rates, like low interest rates. 150 00:08:51,210 --> 00:08:54,292 And at a certain time, the teaser rates would go up and interest rates would go up. 151 00:08:54,392 --> 00:08:58,016 Because they had no jobs, no income, they were going to default on all these mortgages. But 152 00:08:58,056 --> 00:09:01,619 to make matters worse is where it got really bad. The 153 00:09:01,719 --> 00:09:05,082 banks took those mortgages, bundled them together into what's 154 00:09:05,102 --> 00:09:08,465 called a mortgage bond. And 155 00:09:08,766 --> 00:09:13,404 they then packaged the crappy mortgages with the good mortgages. Then 156 00:09:13,825 --> 00:09:17,287 the ratings agencies like Moody's and S&P they 157 00:09:17,387 --> 00:09:20,729 rated these crappy mortgage bonds with like good ones and crappy 158 00:09:20,789 --> 00:09:24,632 ones in it, right? They've rated them triple-a. So 159 00:09:24,812 --> 00:09:28,454 everyone in the financial industry thought that these things were actually 160 00:09:28,894 --> 00:09:32,016 good Right, and so they basically as the old 161 00:09:32,036 --> 00:09:35,199 saying goes they polish deterred and then they saw then what happened was they 162 00:09:35,259 --> 00:09:38,624 actually took these mortgage bonds that everyone thought were great and And 163 00:09:38,644 --> 00:09:42,006 they then sold them in big portions to countries 164 00:09:42,046 --> 00:09:45,669 like Iceland. So these countries are buying these massive mortgage 165 00:09:45,729 --> 00:09:49,031 bonds and are leveraging up to buy more of them because they 166 00:09:49,071 --> 00:09:52,234 knew that property wouldn't go backwards and mortgages are the safest things ever. And these were rated as 167 00:09:52,254 --> 00:09:55,596 AAA. And of course, eventually, the world found 168 00:09:55,716 --> 00:09:58,858 out that there was a massive fraud going on. The banks were lending to the wrong 169 00:09:58,898 --> 00:10:02,100 people. The rating agencies were rating them wrong. And people were buying 170 00:10:02,140 --> 00:10:05,703 on leverage at the same time, these crappy mortgages. And of course, when 171 00:10:05,743 --> 00:10:11,025 that was found out, The whole world pretty much collapsed. The 172 00:10:11,806 --> 00:10:15,110 banks created the greatest financial catastrophe since the 173 00:10:15,771 --> 00:10:18,855 1929 stock market collapse and the Great Depression. We were, in fact, on the 174 00:10:18,995 --> 00:10:22,419 verge of a Great Depression. It was so bad that large banks 175 00:10:22,459 --> 00:10:25,783 like Lehman Brothers were going bankrupt. Bear Stearns almost went 176 00:10:25,843 --> 00:10:29,027 bankrupt. JPMorgan bought Bear Stearns, Lim 177 00:10:29,047 --> 00:10:32,613 Brothers was gone, collapsed, bankrupt. Can you imagine this? The United 178 00:10:32,673 --> 00:10:35,898 States banks were going broke. So the bank run started to 179 00:10:35,938 --> 00:10:39,183 happen. People started to freak out and panic. So they should have, because this 180 00:10:39,243 --> 00:10:43,380 is really bad. And there was all this leverage in the market. And 181 00:10:43,580 --> 00:10:46,963 until Hank Paulson stepped in and changed that, 182 00:10:47,304 --> 00:10:50,406 he was the head of the US Federal Reserve at the 183 00:10:50,426 --> 00:10:53,729 time, and he had to come in and say, hey, we need to loosen up the money and 184 00:10:53,769 --> 00:10:57,212 provide credit to the marketplace. And if he hadn't done that, we 185 00:10:57,232 --> 00:11:00,335 would literally have gone through a Great Depression. The world doesn't even understand how bad it 186 00:11:00,375 --> 00:11:03,498 was. But it was really bad. It was actually one of the greatest crashes ever. 187 00:11:03,518 --> 00:11:06,841 And what happened was it affected property prices. And this is why even today, people 188 00:11:06,861 --> 00:11:10,282 are like, property only goes up. Yeah, right. Go back. You weren't even born. 189 00:11:10,762 --> 00:11:14,123 If you were like 35 and younger, you have no idea what you're talking about 190 00:11:14,183 --> 00:11:19,124 unless you've read financial history. You just don't. I was 191 00:11:19,524 --> 00:11:23,085 23 when the 2008 financial collapse happened. I actually watched the TV as 192 00:11:23,305 --> 00:11:26,605 all these banks collapsed before our very eyes. And my dad said to me, we'll be lucky 193 00:11:26,625 --> 00:11:29,866 to keep our house. And he was right. Everyone's houses went back by 194 00:11:29,906 --> 00:11:33,446 50%. They were buying off-the-plan mortgages here, our homes 195 00:11:33,466 --> 00:11:37,299 here, fell by 50%. I saw people walk away from their deposits. I 196 00:11:37,339 --> 00:11:41,062 saw builders, developers in business for 40 years go 197 00:11:41,182 --> 00:11:44,485 broke here, let alone all around the world. So 198 00:11:44,645 --> 00:11:49,822 property doesn't always go up, just so you know. Banks 199 00:11:49,842 --> 00:11:53,303 got greedy back then. It was bad. But thankfully, there 200 00:11:53,343 --> 00:11:56,484 was enough credit supply by the US government to 201 00:11:56,564 --> 00:12:00,084 maintain a level of order in the banking and financial industry. So 202 00:12:00,164 --> 00:12:03,245 sadly, the taxpayer bowed out the banks. That sucks. There's a 203 00:12:03,265 --> 00:12:06,486 lot of regulation. But at the end of the day, it was a massive crash. It 204 00:12:07,026 --> 00:12:10,287 collapsed by up to 40%. But what was really cool about 205 00:12:10,327 --> 00:12:13,669 that is that there was incredible deals at the time. Like Warren Buffett 206 00:12:13,689 --> 00:12:17,051 took $5 billion of Berkshire Hathaway's money 207 00:12:17,151 --> 00:12:20,593 and he actually lent it to Bank of America to give them liquidity and 208 00:12:20,613 --> 00:12:24,095 he got a 9% return on that and then he turned it into, they're called convertible notes, 209 00:12:24,396 --> 00:12:28,158 he turned it into shares in the bank and he 7X'd 210 00:12:28,178 --> 00:12:31,580 it. He 7X'd 5 billion. There 211 00:12:31,620 --> 00:12:35,623 was so many cool deals. You could have picked up like cents 212 00:12:35,663 --> 00:12:39,452 on the dollar back then and the only thing 213 00:12:39,492 --> 00:12:42,674 that I hate was I had no money because I was just starting my career. And 214 00:12:42,694 --> 00:12:45,956 I made this promise to myself, I'm like, Oh my God, I wish I had like 215 00:12:45,976 --> 00:12:49,778 a million bucks, I could have seven x that million like it was crazy. The 216 00:12:49,918 --> 00:12:52,939 deals around were just mental. Like I remember one person, a 217 00:12:53,160 --> 00:12:56,902 real estate agent called me up and said, Lloyd, do you want to buy this apartment in service paradise 218 00:12:56,982 --> 00:13:00,484 for $49,000? I was like, nah. And 219 00:13:00,504 --> 00:13:03,805 looking back, I'm like, idiot. But because I've 220 00:13:03,905 --> 00:13:07,728 seen that happen, and I know that this happens, like, A 221 00:13:07,808 --> 00:13:11,469 correction of 10%, just so you know what we've experienced lately, it 222 00:13:11,529 --> 00:13:15,990 happens like once or twice a year. Once 223 00:13:16,050 --> 00:13:19,751 every year, once every 18 months, okay, let's say. A 224 00:13:20,111 --> 00:13:23,572 20% correction or crash or a bear market, it'll actually happen 225 00:13:23,632 --> 00:13:27,273 every three to four years. And then an absolute collapse, 226 00:13:27,313 --> 00:13:31,014 like a stock market crash by 30% or more like the GFC, it'll 227 00:13:31,034 --> 00:13:34,555 happen every say 12 to 15 years. So 228 00:13:34,615 --> 00:13:37,825 I'm not even like, Guessing it's gonna happen again 229 00:13:38,025 --> 00:13:41,246 It will you have to understand it will so the people at the moment that 230 00:13:41,266 --> 00:13:44,828 are like clamoring up and getting all this Borrowings to buy property at the moment and 231 00:13:44,888 --> 00:13:48,150 people that are like leveraged up and they think it's all gonna be roses like 232 00:13:48,190 --> 00:13:51,672 it is I've got some news for you. It ain't like one day this 233 00:13:51,712 --> 00:13:54,953 will happen again. So how do you prepare for it? Well, the first thing 234 00:13:54,993 --> 00:13:58,435 is to educate yourself so you can dominate and and leverage it when it happens But 235 00:13:58,455 --> 00:14:02,338 the other thing is don't overgear Like property can't, a 236 00:14:02,458 --> 00:14:06,061 good idea becomes a bad idea when it's done to the nth degree. So 237 00:14:06,101 --> 00:14:09,303 just be very careful if you're getting five, six, seven, eight, 10 properties and you 238 00:14:09,363 --> 00:14:13,207 owe a lot of money. Interest rates can spike very quickly because in 1974, there 239 00:14:13,227 --> 00:14:16,649 was a oil embargo and actually spiked oil massively and 240 00:14:16,710 --> 00:14:20,152 interest rates went to 17%. Now, if all of you got interest rates of 241 00:14:20,192 --> 00:14:23,355 17% because of an oil embargo, you're all cooked, promise you. So that's 242 00:14:23,375 --> 00:14:26,678 gonna cause a massive collapse in real estate. Now that's a possibility. So 243 00:14:26,878 --> 00:14:30,121 it doesn't mean be scared, it means be ready. And so that's why it's 244 00:14:30,161 --> 00:14:33,343 nice to have a bit of cash always on the side. So when deals like this pop up, you 245 00:14:33,363 --> 00:14:36,425 can leverage it, you can jump in and take advantage of 246 00:14:36,465 --> 00:14:39,647 it. But also means if you're not totally leveraged, and you've 247 00:14:39,667 --> 00:14:42,809 got multiple income streams, you're prepared for the worst because without a 248 00:14:42,869 --> 00:14:46,092 doubt, this will happen again. In fact, we might be seeing the beginnings of it now 249 00:14:46,132 --> 00:14:49,714 with AI, because AI is the new internet. So 250 00:14:49,734 --> 00:14:53,177 you're going to see a lot of this hype happen like the dot com bubble, and all this investment 251 00:14:53,297 --> 00:14:56,359 may pay back, you may see a bigger crash than what we just saw in the 252 00:14:56,399 --> 00:14:59,601 last year. Just quickly, if you're ready to take control of your finances, but 253 00:14:59,641 --> 00:15:02,864 feel stuck on where to start, I have a solution. My 254 00:15:02,924 --> 00:15:06,086 book Money Buys Happiness simplifies investing and 255 00:15:06,166 --> 00:15:09,709 wealth building with practical steps to help you achieve financial peace. 256 00:15:10,249 --> 00:15:13,572 Get your copy via the link in the show notes and let's get your money working for 257 00:15:13,612 --> 00:15:17,575 you. Now back to the episode. So that is the GFC. And 258 00:15:17,615 --> 00:15:21,058 the latest one that has happened, the latest panic was of course 259 00:15:21,458 --> 00:15:24,521 COVID. And this happened not very long ago. It was like five years ago. Can 260 00:15:24,581 --> 00:15:27,803 you believe it's five years? Five years ago. And of course, what happened was this. 261 00:15:28,854 --> 00:15:32,115 The whole world thought that this common cold, I don't know 262 00:15:32,135 --> 00:15:35,556 if you know this, but the common cold is a coronavirus, just so you know. 263 00:15:35,616 --> 00:15:38,877 All common colds are coronaviruses, without going into too much detail. They called that because 264 00:15:38,897 --> 00:15:42,018 they got little coronas on them. I don't know, that's how they got a 265 00:15:42,058 --> 00:15:45,159 pre-med degree. They're just cold. And I 266 00:15:45,199 --> 00:15:48,560 got it, and I was like, that sucks, but it's fine, I didn't die. And what happened 267 00:15:48,580 --> 00:15:52,322 was the whole world through social media thought everyone was gonna collapse and die. So 268 00:15:52,362 --> 00:15:55,663 the whole world and the mainstream media put everyone in a little panic. And of course they closed 269 00:15:55,683 --> 00:15:59,006 the world. No way they're going to close the world down. No way they're 270 00:15:59,026 --> 00:16:02,669 going to close airports. No way. No one is this stupid. No 271 00:16:02,709 --> 00:16:06,112 people are this stupid. I just spat on the mic there. No one is this stupid. I 272 00:16:07,173 --> 00:16:10,336 was just cleaning it off. No one is this stupid that they're going to 273 00:16:10,356 --> 00:16:13,490 close the world down. But 274 00:16:13,790 --> 00:16:17,112 what I learned was never underestimate the stupidity of 275 00:16:17,193 --> 00:16:20,415 governments and the public. I 276 00:16:20,455 --> 00:16:23,717 mean, recently we had a cyclone and all the same stupid people went 277 00:16:23,737 --> 00:16:27,419 in to buy toilet paper. What the hell are you going to do with toilet paper coming out of your wazoo? What 278 00:16:27,459 --> 00:16:30,581 the heck are you doing? The same thing happened. I'm like, surely people are going 279 00:16:30,601 --> 00:16:33,744 there. Surely the government's not that dumb. Yes, they are. So I'm like, 280 00:16:33,884 --> 00:16:37,608 oh my God, I underestimated the stupidity of what happens in panics, okay? So 281 00:16:37,628 --> 00:16:40,891 there's another lesson learned there that when the world gets to a panic, you 282 00:16:40,931 --> 00:16:44,235 start to see massive stupidity, all right? So I'm like, oh my God, this 283 00:16:44,295 --> 00:16:47,518 is actually happening. Now, thankfully I had saved up some money then because 284 00:16:47,538 --> 00:16:50,626 I'd learned from the GFC. And when that happened, I 285 00:16:50,706 --> 00:16:53,969 knew that it was a common cold. I knew that the survival rates 286 00:16:53,989 --> 00:16:58,153 were very high. And I knew that in a 287 00:16:58,193 --> 00:17:01,936 year or two, we'd come out of this very quickly when they discovered it. So 288 00:17:02,357 --> 00:17:05,920 I knew that the market would correct very fast. So I thought that this drop 289 00:17:06,360 --> 00:17:09,483 is a once in a lifetime opportunity. So where do we look to put 290 00:17:09,523 --> 00:17:12,986 our money? We deployed it into travel companies. And we were buying travel 291 00:17:13,026 --> 00:17:16,629 companies when they'd sunk by like 90%. And we were buying 292 00:17:16,709 --> 00:17:19,850 stocks, you know, like across the market. And 293 00:17:19,950 --> 00:17:23,552 so that we were able to grow a lot of wealth in that period of time quite quickly 294 00:17:23,852 --> 00:17:27,093 because we knew it was going to correct again. Every storm 295 00:17:27,133 --> 00:17:30,415 runs out of rain, like every big market collapse has 296 00:17:30,475 --> 00:17:33,777 recovered. every single one so of course it'll recover again 297 00:17:34,017 --> 00:17:37,379 just the worst thing you can do is panic to the point where you sell at the bottom all 298 00:17:37,419 --> 00:17:41,001 right that's what you'd want to absolutely avoid that so that's 299 00:17:41,021 --> 00:17:44,343 the latest one it was covid it was caused by panic the late the 300 00:17:44,483 --> 00:17:47,605 the the correction lately has been a 10 one will we see a 301 00:17:47,665 --> 00:17:50,987 big one in the future it's highly likely when No one 302 00:17:51,067 --> 00:17:54,350 knows. So you just have to be prepared for it. So even 303 00:17:54,830 --> 00:17:58,333 massive crashes, whilst they seem really bad, can create massive opportunities 304 00:17:58,353 --> 00:18:01,575 for you. And of course, history doesn't repeat, but it rhymes. So 305 00:18:01,595 --> 00:18:05,097 there will be this sort of pattern that happens where there's a boom, then 306 00:18:05,137 --> 00:18:08,620 there's massive greed, then there's a massive bust, and then there's fear. And 307 00:18:08,640 --> 00:18:13,547 that whole cycle will start again. But it does create opportunity. You 308 00:18:13,567 --> 00:18:17,411 have to be ready to take advantage of those opportunities. But also, make 309 00:18:17,431 --> 00:18:20,835 sure you understand that the media's job is to create panic and noise and 310 00:18:20,975 --> 00:18:24,298 fear in you. Like it's his job, okay? So don't just jump 311 00:18:24,338 --> 00:18:27,582 on the news and watch and think, oh my God, the world's crashing, we're all gonna die. No, 312 00:18:27,942 --> 00:18:31,205 go and do your own research and look for the noise. and look 313 00:18:31,225 --> 00:18:34,969 for then the signal beyond the noise, all right? Emotional investors lose, 314 00:18:35,309 --> 00:18:38,493 disciplined, intelligent, educated investors win. So you've 315 00:18:38,513 --> 00:18:41,656 got to choose, which one will you be? The panic-stricken, emotional one, 316 00:18:41,976 --> 00:18:45,059 or the disciplined, educated one? Because it does make a 317 00:18:45,099 --> 00:18:48,302 difference, all right? So here's what you want to do when it happens. The first thing 318 00:18:48,363 --> 00:18:51,966 to do is just zoom out. step back and understand that the S&P 500, which 319 00:18:52,006 --> 00:18:55,209 is the market, has grown massively in the last 100 years. It's 320 00:18:55,230 --> 00:18:58,453 incredible. In fact, if you put $10,000 in 1942 before the war ended, you would now have $54 million. So it's bumpy, but 321 00:19:05,512 --> 00:19:08,694 the world's going to progress. So don't bet on the end of the world, because even if 322 00:19:08,714 --> 00:19:11,896 you're right, you don't make any money. So stop trying to time the 323 00:19:11,936 --> 00:19:15,078 market. Time in the market is better than time in the 324 00:19:15,118 --> 00:19:18,680 market. Use the downturns to accumulate more assets faster, 325 00:19:18,760 --> 00:19:21,922 stocks, ETFs, and property, and automate your investing, which 326 00:19:21,982 --> 00:19:25,384 means start to dollar cost average, which means buy the 327 00:19:25,444 --> 00:19:28,725 same thing that you're wanting to invest in long term, but buy 328 00:19:28,745 --> 00:19:32,247 it periodically at the same time. So every month, every quarter, same 329 00:19:32,287 --> 00:19:35,889 amount, same time, same amount, same time, same amount, same 330 00:19:35,949 --> 00:19:39,250 time. Because if you were to do that with your shopping, you 331 00:19:39,270 --> 00:19:42,872 buy the same food, same time each week, sometimes there's gonna be some deals, sometimes 332 00:19:42,892 --> 00:19:46,193 there's not. But over time, you're gonna average out your buying and you're gonna get it for better 333 00:19:46,213 --> 00:19:49,815 prices, okay? So don't follow the hype, study history. 334 00:19:50,195 --> 00:19:54,077 And here's a final thought for you. The market doesn't repeat perfectly. 335 00:19:54,437 --> 00:19:57,778 But as I said earlier, it does rhyme. So if you understand the 336 00:19:57,838 --> 00:20:01,198 patterns like I've explained in this episode, you'll see what it 337 00:20:01,278 --> 00:20:04,459 is all about. And you'll kind of understand, well, it's going to come again. Will I be ready 338 00:20:04,499 --> 00:20:08,600 or not? And it's going to run out of rain. The storm will actually disappear too. 339 00:20:09,020 --> 00:20:12,221 So having this understanding is one of the great wealth building opportunities of 340 00:20:12,261 --> 00:20:15,442 your life. Because if you're young enough, you haven't experienced it before. But I 341 00:20:15,482 --> 00:20:18,783 promise you, at some point, it's coming. All right. So make 342 00:20:18,823 --> 00:20:22,226 sure you take this information and absolutely apply it. All right. Because history shows 343 00:20:22,326 --> 00:20:25,470 us those who stay calm, invested and smart come 344 00:20:25,490 --> 00:20:28,673 out on top. All right. It's not the end of the world. It's just another chapter in 345 00:20:28,693 --> 00:20:31,976 a very familiar story. So zoom out. Stay 346 00:20:32,016 --> 00:20:35,419 the course. If you play it right, this could be the moment that changes your 347 00:20:35,459 --> 00:20:38,802 financial future forever. So thanks for listening and go check 348 00:20:38,882 --> 00:20:42,105 out the next episode and the next video on YouTube. Thanks for listening to 349 00:20:42,145 --> 00:20:45,447 Money Grows on Trees. If you enjoyed the episode, leave a five-star review 350 00:20:45,467 --> 00:20:48,589 on Apple Podcasts and Spotify and subscribe to 351 00:20:48,669 --> 00:20:52,112 us on YouTube so you never miss an episode. And if you're serious about building 352 00:20:52,172 --> 00:20:55,575 wealth, make sure to check out the links in the show notes and follow me on 353 00:20:55,755 --> 00:20:59,337 all social media platforms at LloydJamesRoss for