The 2020 Recession: How To Prepare For The Next Market Crash

welcome back to whiteboard finance my name is Marco and I'm here to help you master your money and build your wealth in this video we're going to talk about the 2020 recession and how I will help you prepare for the next market crash so if you've been following financial news you can obviously see all the articles headlines and obvious signs that were headed for a recession eventually the Fed cut rates last week when the economy is supposedly doing well there's been multiple inverted Treasury yield curves unemployment levels have been bottoming out they're at a ten-year low right now and I think that they can only go up from here they're massive layoffs at Verizon for Deutsche Bank GM Citigroup etc etc so in this video I wanted to talk about my personal prediction of when this recession will happen defensive strategies that will help you prepare for the next market crash offensive strategies that will help you prepare for the next market crash and to follow my buddy Graham Stefon smash the like button if you get value out of this video avocado toast sandals pineapple shirts insert millennial object here stay tuned you guys so if you guys have been following YouTube's financial news which is not to disparage any YouTube financial news but a lot of it is sensationalist for a reason just to get clicks and eyeballs and all that you've seen these headlines before 2013 recession 2014 recession 2015 recession the next housing bubble is gonna crash in 2016 well here we are in the middle of basically 2019 and none of that stuff has happened yet so this isn't gonna be one of those videos this is genuinely a video where I feel that you know late 2019 early to mid 2020 we will start to see the economy slow down so I do have first-hand evidence for that okay so unlike most financial youtubers I actually have a finance degree and I've actually worked in finance pretty much my whole career I just left my job at a publicly traded bank here in Northeast Ohio to pursue YouTube full-time so when I worked at this bank I'm not gonna say you know what bank it is I was a credit analyst okay so basically well it was in the krauser credit associate which is a step above an analyst but ultimately the same thing for layman's terms I analyze companies of numbers their financials their balance sheets all that stuff and just to see if they were credit worthy okay so a lot of our middle market companies that I was analyzing they were pretty much being downgraded so they would go from what we call a let's call it a 13 risk rating all the way down to a 17 or higher okay the lowest that you can go is an 18 the higher the number the worse it is so like the US government would be a credit rating of 1 right so I started to see firsthand that these middle market businesses that were businesses anywhere from like you know 50 million at 250 million dollars in revenue and you know Northeast Ohio they were starting to get down created like crazy and you can see that their numbers were getting worse year over year so this isn't just some like MSNBC headline this is my actual first-hand experience and I do know it's anecdotal but this does play into a role later in this video so also at the company I worked for and also with all the other finance companies that I've been reading about layoffs started to happen okay this means that you know banks and especially people working in the finance industry they were starting to see the writing on the wall that the economy is going to slow down another good indicator is what I mentioned earlier in this video if you look at like GM and Ford and all those other companies they're basically cutting about 10 to 15% of their workforce overseas and also domestically so with all that being said the writing is kind of on the wall and I just wanted to mention that so my ultimate prediction is that this recession will start sometime in 2020 and it's not going to be a bubble okay so it's not going to be like if you remember in oh seven we had the subprime mortgage crisis where basically people that were making 50 grand we're getting qualified for houses that cost you know five six hundred thousand dollars right these were cops and nurses living in mansions okay so this is not the issue it's not going to be like the housing bubble or it just took a little pinprick and the whole thing kind of exploded right this is going to be long and slow in my personal opinion and that because we've been pumping in artificial money into the economy for about five or six years now in my personal opinion so with that being said of this being a long and slow recession I want to start with my defensive strategy for everyone first okay so the best offense is a good defense and most championships are won because the team is very good at defense okay so the first one and a lot of these are going to sound like common sense but common sense is not always common practice remember that if that was like a tweetable quote remember that common sense is not common practice so basically the defensive strategy the first one I have is pay off all high interest debt okay really what I want to say with this is pay off all debt period if possible because these high interest debts or all debts in general those monthly recurring payments of stuff that you bought that you don't need just to impress people you don't like it's gonna drain you if you lose your job in a low and slow recession so it's gonna be kind of like death by a thousand cuts you're gonna have the house the car the furniture that you finance the thing you put on layaway you know all the stupid things that you didn't need that consumer electronics the TV the appliances all that stuff the little $50.00 a month payment here the little interest payment there it's all going to come back to bite you in the butt so number one is pay off all high interest debt number two I'm going to take a page out of my friend Dave Ramsey's book and that's a we're gonna create a three to six month emergency fund okay so you should have this anyway regardless of good economy or bad economy or recession or not you need a three to six month emergency fund because you may get laid off during this time period a lot of people a lot of companies are cutting their workforce and you may be one of them if you get laid off this will save your butt period end of story trust me I know so I graduated in December of 2010 when unemployment was almost 10 percent that means one out of every ten people that were even looking for a job were unemployed okay so with all this being said I want you start a three to six month emergency fund okay the third one were being defensive here this is not offense this is defense if you already have positions established in the market do not panic cell okay this is like when I poker player or a gambler goes on tilt and they just go crazy do not panic sell this is the worst thing you can do you've spent all this time and money investing into these companies and you see them go 10 15 20 percent down you're thinking holy crap let me get rid of this falling knife right no do not panic sell if you look at historic charts you will see that even in oh seven and Oh 8 when most the stock market was losing 40 percent of its value all those companies pretty much doubled over time over the next 10 years that's pretty much how I've built my own personal stock portfolio since I was 18 years old so I'm 31 right now at the time of this recording it's 20 19 I started investing about 13 years ago and like oh six right around there right when I graduated high school lost my butt in the recession but ever since then you know you could have been a monkey throwing darts at a dartboard and made money in this market so do not panic sell okay so now let's talk about the offensive strategies so once you've done all of the defensive strategies that I've talked about in terms of building your emergency fund and making sure not to panic cell you need to go on the offensive okay so you can't win if you're not playing good offense and for those of you that can't read my hieroglyphics this says offensive so basically you need to start building your war chest okay so you got to build your war chest and that war chest is going to have all your money and gold bars and silver and you know this and that and it's glowing filled with money okay I wish I had like a yellow marker but that's not gonna show up anyway so just pay attention once you start building your war chest this is the money that you're gonna use to invest and this is the money that's going to grow for you most fortunes are made during a recession okay let me repeat that most fortunes are made during a recession if you picked up a bunch of rental properties in Oh 708 they've pretty much doubled in value if not tripled in value at this point and you've also been making a nice cash flow this whole time okay that's just one example look at stocks a lot of my stocks I've gained almost a hundred percent on since the last recession okay granted that was a very big bubble and almost like a once-in-a-lifetime opportunity but any correction is a time for scooping up more assets so you need to save as much money as possible to use to invest and you need to grow that warchest okay so once you've grown that warchest you need to do number two okay this remember this is gonna be in my personal opinion at a low and slow and long recession it's you need to systematically invest okay so you need to automate your savings and your investing okay so what we call in financial terms this is dollar cost averaging down okay so if this is the market right now and the recession is making a do one of these we're it's low and slow you need to buy at regular intervals whether it's once once a month once a week once a quarter whatever me I'm plugging invest in the same basket of stocks or ETF probably once a month just so I make sure if I think that the recession is gonna be low and slow I'm picking it up here for fifty bucks a share forty six to share forty or share thirty seven a share do you see what I'm saying so with all this being said you're gonna dollar-cost average and end up somewhere in the middle of all these prices and then when the market picks back up you're gonna be somewhere around here your basis but the price the stock is going to be up there okay makes sense and then finally this one has nothing to do with investing but is being on the offensive so that's why I put it in the offensive category okay what you need to start doing and I know this sounds scary to some of you and this is number three is update your resume okay update your resume and start networking your butt off go on LinkedIn get then premiums started going to all the networking events in your area because if you do lose your job you're already one step ahead and either the hiring process at a new company or you're already making connections that could save your butt during a layoff okay so now this only applies that if you think you're actually going to get laid off if you own your own business obviously you don't need to do this but if you're a w-2 employee or an office worker or just someone that's looking for a new job you absolutely need to update your resume and put yourself out there you know be a mover and a shaker or shake some hands kiss some babies you know slap people on the on the shoulder whatever go get a drink with them networking is all about who you know not what you know and when it comes to getting a job this has got me multiple jobs in the past so the best time to find a job is when you already have a job so that's why we're being offensive so even if you're already employed go on the offensive okay and if you want to know how to negotiate a salary or create a brag book watch my previous video on negotiating a salary brag book is very important so ultimately in summary you guys these are very simple but again common sense is not common practice you need to be defensive so make sure you have that little nest egg you need to get rid of all your debt you need to basically make sure that all your Ducks are in a row financially and then you can go on the offensive and take advantage and prosper from the upcoming recession so whether the recession is going to happen in 2020 or not or if it's going to happen in 2021 there definitely is going to be a global economic slowdown and I think the United States has been printing a lot of funny money over the last five six years that's just my personal opinion if you got value out of this video please give it a like please share it on social media or with a friend and as always have a prosperous day [Music]

Channel: Marko - WhiteBoard Finance

Views: 379,226

Rating: 4.866775 out of 5

Keywords: 2020 recession, 2020 recession how to prepare, the 2020 recession, market crash 2020, the next market crash, economic crash 2020, economic crash, next financial crisis, next financial crisis 2020, next financial crash, 2020 market correction, financial crises, recession 2020, recession, how to prepare for the next recession, how to prepare for the next global recession, stock market crash 2020, stock market crash, market crash

Id: jvymyRS0Vug

Length: 12min 59sec (779 seconds)

Published: Wed Aug 14 2019