You haven’t seen the effects of *any* of Trumps decisions yet. And Obama’s decisions had virtually zero impact on creating the Great Recession. There wasn’t time. Unless you believe in teleportation, magic, and instantaneous changes to the marketplace and if that’s the case, I’m a nigerian prince building a bridge and boy have I got a business proposition for you…
The last week of January 2018 and the first week of February 2018, the Dow Jones dropped several hundred points. It looks to close out February 2 down hundreds of points, with other indexes (S&P 500, NASDAQ) to follow. While this may seem like a crisis, it is more than likely to reflect short-term investors taking their profits (in the long run up to this point) and shuffling them to other types of investments to prepare for improved bond yields.
On Black Monday, the Dow Jones Industrial Average fell 38.33 points to 260, a drop of 12.8%. The deluge of selling overwhelmed the ticker tape system that normally gave investors the current prices of their shares. Telephone lines and telegraphs were clogged and were unable to cope. This information vacuum only led to more fear and panic. The technology of the New Era, previously much celebrated by investors, now served to deepen their suffering.
“The kingdom affirms its total rejection of any threats and attempts to undermine it, whether by threatening to impose economic sanctions, using political pressures or repeating false accusations,” the government said  in a statement released to Saudi media. “The Kingdom also affirms that if it receives any action, it will respond with greater action.”
However, if China’s economy falters it might. Geopolitical turmoil concerning North Korea, Iran, Syria or Russia could also become a catalyst if things escalate enough. It’s most likely that the next market crash, whenever it occurs, will be the result of a perfect storm caused by several factors. But, since it’s not something anyone can predict, it’s best to concentrate on being prepared for a crash whenever it may occur.
Toronto is a high value housing market similar to New York City or the Bay Area of California, and TO is a city destined to be a super city.  It’s unlikely that a property purchase in Toronto will be a disappointment over the long run. If you see the Toronto home price charts, you’ll notice that prices have climbed in the last 18 months. So buyers have not lost their equity.
It truly does appear that the elements for a “perfect storm” are beginning to come together.  We have been enjoying a period of relative stability for so long that many Americans have allowed themselves to become lulled into a state of complacency.  That is a huge mistake, because all along we have been steamrolling toward disaster, and nothing has been done to alter our course.
In Professor Sornette’s model, a bubble is a market heading to a critical point. But a crash is not the only possible post-crisis outcome: Prices can also stop rising and reach a higher plateau. It is precisely because of the small but real probability that a bubble will not crash but simply stop growing that it is rational for some investors to stay in the market, even when if they think that it has gone too far, too fast.
The Commodity Futures Trading Commission (CFTC) investigation concluded that Sarao "was at least significantly responsible for the order imbalances" in the derivatives market which affected stock markets and exacerbated the flash crash.[10] Sarao began his alleged market manipulation in 2009 with commercially available trading software whose code he modified "so he could rapidly place and cancel orders automatically."[10] Traders Magazine journalist, John Bates, argued that blaming a 36-year-old small-time trader who worked from his parents' modest stucco house in suburban west London[10] for sparking a trillion-dollar stock market crash is a little bit like blaming lightning for starting a fire" and that the investigation was lengthened because regulators used "bicycles to try and catch Ferraris." Furthermore, he concluded that by April 2015, traders can still manipulate and impact markets in spite of regulators and banks' new, improved monitoring of automated trade systems.[3]
It truly does appear that the elements for a “perfect storm” are beginning to come together.  We have been enjoying a period of relative stability for so long that many Americans have allowed themselves to become lulled into a state of complacency.  That is a huge mistake, because all along we have been steamrolling toward disaster, and nothing has been done to alter our course.
On Friday, September 19, the Dow ended the week at 11,388.44. It was only slightly below its Monday open of 11,416.37. The Fed established the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility. It loaned $122.8 billion to banks to buy commercial paper from money market funds. The Fed's announcement confirmed that credit markets were partially frozen and in panic mode.
2015–16 stock market selloff 18 August 2015 The Dow Jones fell 588 points during a two-day period, 1,300 points from August 18–21. On Monday, August 24, world stock markets were down substantially, wiping out all gains made in 2015, with interlinked drops in commodities such as oil, which hit a six-year price low, copper, and most of Asian currencies, but the Japanese yen, losing value against the United States dollar. With this plunge, an estimated ten trillion dollars had been wiped off the books on global markets since June 3. [30] [31] [32]
The May 6, 2010, Flash Crash,[1][2] also known as the Crash of 2:45, the 2010 Flash Crash or simply the Flash Crash, was a United States trillion-dollar[3] stock market crash, which started at 2:32 p.m. EDT and lasted for approximately 36 minutes.[4]:1 Stock indexes, such as the S&P 500, Dow Jones Industrial Average and Nasdaq Composite, collapsed and rebounded very rapidly.[4] The Dow Jones Industrial Average had its second biggest intraday point drop (from the opening) up to that point,[4] plunging 998.5 points (about 9%), most within minutes, only to recover a large part of the loss.[5][6] It was also the second-largest intraday point swing (difference between intraday high and intraday low) up to that point, at 1,010.14 points.[4][5][7][8] The prices of stocks, stock index futures, options and exchange-traded funds (ETFs) were volatile, thus trading volume spiked.[4]:3 A CFTC 2014 report described it as one of the most turbulent periods in the history of financial markets.[4]:1

It is not just the uber rish who lose the most. It is the middle class workers. Those of us who have worked hard and survied years of down sizing in larger corporations who will lose a great deal…along with all those who also benifit from our generosity over the years. All the school supply drives, blood drives, holliday food drives to name a few. We try to contribute the amount to our 401’s to earn the companies matching benifits. We are pentalized for taking out our money until we reach the age of 59. Those of us who are to close to retiring don’t have the opportunity to recoup our money. So we will be faced with working to a much older age then we planned. So in reality…while we may be middle income…we don’t have the ability to just put out our money. If we lose a great portion of our 401’s and there is another housing market crash they have managed to chip away yet another chuck of middle imcome households. Sooner or later it will only be the very poor and the very rich! We need a solution to bring back the middle income and a solution for more and more folks to have the opportunity to move beyond lower income! We have done our best to prepare for what life might throw at us short term and long time, but I do believe it is going to be a bummpy ride, so buckle up my prepper friends.
For example, the United States has a set of thresholds in place to guard against crashes. If the Dow Jones Industrial Average (DJIA) falls 2,400 points (threshold 2) before 1:00 p.m., the market will be frozen for an hour. If it falls below 3,600 points (threshold 3), the market closes for the day. Other countries have similar measures in place. The problem with this method today is that if one stock exchange closes, shares can often still be bought or sold in other exchanges, which can cause the preventative measures to backfire.
In the recent statement, the head of research at Fundstrat Global Advisors pointed out two major types of crypto players — those who are “using it and have wallets in crypto,” and those who belong to a speculative side of the market. According to Lee, those two sides of the crypto community should find a way for “sort of interacting with each other” for crypto investors not to get burnt by crashes like this.

When Tobin’s Q is in its uppermost quartile, as it is today, it suggests this reward/risk equation is not at all favorable for investors. In other words, these “fat tails” get even fatter during these periods thus investors should look to hedge their portfolios against large declines. And this is precisely the “asset inflation” Taleb was referring to in the interview mentioned at the top of this post.


Investors bore the emotional scars from the crash for the next four years. On June 1, 2012, they panicked over a poor May jobs report and the eurozone debt crisis. The Dow dropped 275 points. The 10-year benchmark Treasury yield dropped to 1.443 during intraday trading. This was the lowest rate in more than 200 years. It signaled that the confidence that evaporated during 2008 had not quite returned to Wall Street. 

Of course, that's an average and the market's return is seldom steady and predictable. Yet, it's important to remember that these attractive returns include many periods when the markets have lost a quarter or half their value, or worse. As a result, even if you know a crash is coming at some point, which it very likely is at some point in the coming years, then it's not a reason to avoid stocks. Provided you can stick with it you'll likely see decent returns from diversified global stocks even including the catastrophic crashes that scare you.
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