Name: 2025 Stock Market Massive Crash Canceled
Uploaded: 2025-08-17T17:59:56.000Z
Duration: 16 min 48 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

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Almost every single indicator suggests that a recession is unavoidable.

Unless the federal reserve will cut the interest rates, we are going to have a recession.

And that's why a lot of experts suggest that the federal reserve most likely will cut the interest rate in September of this year, even though that's a horrible idea since we haven't fixed inflation yet and it's rising, it could actually hit 3 percent by the end of the year and that could damage the US economy tremendously.

On one side, when there is a recession, investors tend to sell their stocks dramatically in order to avoid potential losses.

On the other side, if you look at the stock market today, it is growing tremendously.

So, why the chances of a recession growing on one side and investors are not selling off their stocks and are not exiting their positions?

Yes, there are some investors such as Warren Buffett, but if you look at the stock market, it is growing tremendously.

So, let me explain what exactly is happening.

Chances of a recession are rising primarily because of the jobs report.

The number of jobs that have been added in May and June are less than 20 thousand, which is catastrophic for the US economy.

That clearly indicates that companies are firing people since they expect that there will be a recession and they have to cut their When people have less jobs, they have less income, they will be able to spend less money, which is going to contract the economy.

At the end of the day, the GDP grows because people are spending.

If you are not spending, the economy is not growing, the market is not growing, nothing is growing, and unemployment is clearly rising.

And the 73 thousand number of jobs being added in July most likely will be revised, so I won't be surprised if this number will also be down to 20 thousand.

And this is just the beginning, we have so much chaos in the economy.

By the end of the year, or probably by next year, it is very likely that we won't be adding any kind of jobs, in fact, we will have negative numbers every single month.

The second indicator is obviously personal spending.

It has also been going down since the beginning of the year.

First of all, in the beginning of the year, in 2025, there was a plunge.

This spike was primarily because people thought that tariffs are going to increase prices.

Obviously, they are going to increase prices, but there was so much talk about it in the media, so people panicked, they went to the stores and started buying stuff, because they thought that if they won't buy now, prices are going to rise.

But usually, when there are increases in prices, they happen gradually, they won't happen overnight, because businesses do not want to lose their clients, so they might increase prices slightly.

At its peak, some of the tariffs on China went as high as 245%, so I won't actually blame the consumers for rushing to the stores and buying new iPhones, because they thought that the next iPhone will be 3000 dollars, I can buy it now for 1000 dollars, and maybe I can sell it for 3000 dollars a few months from now.

However, since then, it has actually went down as well.

The next indicator is obviously the consumer sentiment, is how people feel about the market.

It plunged in July of 2022, and that's because since the beginning of 2022 until the summer of 2022, the Federal Reserve was on a mission of hiking the interest rates every single press conference that there was.

So many businesses went out of business, so many companies went out of business, and if you have seen the stock market, it actually crashed dramatically in 2022.

The tech stocks were in such a chaos that a lot of people thought that this is probably the end of the tech revolution, and tech companies started firing people by hundreds of thousands of people.

We already had one negative GDP growth quarter, and that's already a very bad sign, because what is a recession at the end of the day?

So if you have two negative consecutive GDP growth, we call that a recession.

Well, some people might say that we only had one, and the next one was 3% if you annualize it over the last 12 months, but I want you to check this number with a grain of salt, because that number could easily be revised.

You see, whenever we do this kind of statistics, it's very difficult to have the real numbers in the beginning, since you have part of the data, so you have the initial numbers, and then you have the rest of the data, and then you have to adjust everything in order to include all the data that came out within the next couple of months.

So this number will be revised by the end of September, and it could actually be a lot lower.

We are having trade wars with every single country.

There are a possibility of a recession arising, consumer sentiment is going down, unemployment is rising, and now if the fed will increase or lower interest rates in September, then chances of inflation will increase further, and we might have a 3% inflation rate by the end of this year.

So despite all of these signs that a recession is on the horizon, the stock market is hitting a new record.

Yes, there was a plunge in April of this year because of the liberation day.

Everybody absolutely panicked, because nobody knew what's happening.

It was as if the entire world is on a trade war.

There hasn't been anything like that since like 1920s or 1930s, since the great depression, but we don't see that happening ever again.

Now, some people might say that the stock market does not represent the economy.

Well, it does, unfortunately, whether you like that or not.

Maybe it doesn't reflect it instantly, but over the long run, it is going to impact it.

A stock market is where stocks are traded.

And we as investors, when we look at the stocks, we don't look at simply numbers.

When we look at the stocks, we see money-making machines.

So we value the stocks based on how much money they are making today and how much money they could potentially make sometime in the future.

These are, if you simplify the entire investing, you can literally just bring it down to these two fundamental questions.

So when we look at these companies and we see that they're How would they make less money now?

It will reflect in the revenues of these businesses.

So at the end of the quarter, they will have less revenue made, less earnings made, which means that now they worth a lot less.

And that's why if you look at the PE ratio of the S&P 500, it is growing because stock prices are growing, but their earnings are not catching up.

Since people are not spending money, that is clearly a clear indication of an overvaluation of the market.

And that's why if you see a lot of people say that there is an everything bubble, that the market is significantly overvalued, and there is a lot of truth to it.

So why isn't the market collapsing anytime soon?

Why investors are not selling their stocks in order to avoid potential losses?

That is the fundamental question that we have to ask ourselves.

The basic or simple answer to all of that is that there is so much artificial demand in the market.

That demand is being created by the government.

Now if you look at the government's spending and revenue for the last year, they spent 6.7 trillion dollars, but they have earned only 5 trillion dollars.

So there is almost 1.8 trillion dollars of deficit.

This is artificial spending by the government.

So when you have that so much artificial spending by the government entering into the economy, it keeps growing the economy.

Yes, the productivity isn't rising much, but it's impossible to not grow when you have so much spending created by the government.

This spending is not created by the people.

This spending is not created by the businesses.

This spending primarily created by the government and it ends up in the pockets of the people or the pockets of the government or the pockets of the corporations.

The government has to fix this problem because this is unsustainable.

And if you look at the estimates, then over the next couple of years, it will slow down to 1.5 trillion dollars.

These are the most conservative estimates that you see in front of you.

For example, in 2025, it's estimated that it will be like 1.7 trillion dollars.

However, based on the current spending that we already have, it's probably going to be about 2 trillion dollars, maybe even 2.1 trillion dollars.

Because the strategy of the current White House is that we are going to spend so much that the economy or the GDP will grow by more than 3%.

Like they even put the estimates that in order to pay back for the big beautiful bill, they will have a 4 to 5% GDP growth over the next four years.

That is not happening, no matter how you look at it, but they will continue trying to do that.

And the fundamental way to do that is by increasing the government spending because nobody in the economy can spend as much as the government.

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2025 Stock Market Massive Crash Canceled

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