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Stock Market Crash - Hopeless End Or Endless Hope

Corona Crisis: STOCK MARKET CRASH! HOPELESS END OR ENDLESS HOPE?

by Holistic Leave a Comment | Filed Under: Stock Market

Listen to this article


The Sensex crashed from 41952 to 25981. Marking a quick and huge fall of 38%.

Are you worried about your investments during this stock market crash?

Is this an end to stock market investments?

Let’s further find out. What if you thought there was only negative news about the stock market crash?

“You’ll never find a rainbow if you’re looking down” ― Charlie Chaplin

Table of content:

    Morgan Housel and a shock cycle
    How is this related to today’s corona crisis?
    Golden Cross & Corona
    What happens when India reaches the golden cross?

      1. Low-interest rates
      2. Fiscal Stimulus
      3. Cheaper fuel prices
      4. Recoveries and normal functioning
      5. India’s GDP in 2021

    Conclusion

Read this to find the Endless Hope even during corona crisis.

Morgan Housel and a shock cycle:

Morgan Housel is a former columnist at Motley Fool and Wall Street Journal.

He has written about a shock cycle and it goes like this.

  • At first, you don’t see bad news.
  • Then you ignore the bad news.
  • Then you deny the bad news.
  • Then you panic at the bad news.
  • Then you start to accept the bad news.
  • Then you don’t see good news.
  • Then you ignore good news.
  • Then you deny good news.
  • Then you realize you missed the good news.
  • Then you accept the good news.
  • Then you abandon your attachment to bad news.

How is this related to today’s corona crisis?

⭐ At first, you don’t see bad news. When the first news of corona in Wuhan started, it started small and was not covered by all media channels. But the news just spread.

⭐ Then you ignore the bad news. As the news seemed to be unfamiliar (as it happened in China), you did not react much to it.

⭐ Then you deny the bad news. As you couldn’t ignore it anymore, as it’s been reported everywhere and people start talking about it in all media.

⭐ Then you panic at the bad news. When you know that corona has widely spread and is taking the lives of many, you start panicking. Especially when you know that it has arrived in India and has many positive cases and find that there is no cure found yet.

⭐ Then you start to accept the bad news even if it’s painful.

⭐ Then you don’t see good news. The media doesn’t report the good news as they may look like they are not bothered about the lives that are lost. When people are losing their lives and jobs, the media feels it hard to tell the good things happening.

Some of the good news are:

The equities have become cheap and as a result, the promoters are buying shares of their own companies. Eg. Bajaj Group, Tata Group, Godrej group, and many others.

You can read the article here!

People in China (where the first corona case started) are recovering in large numbers. Italy (where a high number of cases were recorded) to relax its lockdown measures from 4th May, as the recoveries exceed the new cases. The Indian States, Kerala, and Haryana have the highest recoveries, exceeding the new cases. Are these pieces of good news getting our enough attention and building our hope?

⭐ Then you ignore good news. You fail to recognize the good news as you’re much involved in the bad news. Stock market has slowly recovering and it has crossed 33000 levels on 30th April 2020.

⭐ Then you deny good news. You concentrate on the bad news so much so, that you deny the good news. Any media promoting good news would be criticized by the people.

⭐ Then you realize you missed the good news. You slowly start realizing good news, and see how pessimist you have been all the time.

⭐ Then you accept the good news. Knowing that the risk has reduced or has completely stopped, you would start accepting the good news when you hear news like there is no increase in the corona cases and when recoveries happen.

⭐ Then you abandon your attachment to bad news. When the media and reports give good news, you slowly forget the bad news and start accepting the good news.

Golden Cross & Corona

Golden cross is not a new concept. It is a very simple and common sensical.

Golden cross in terms of the COVID 19 crisis means the day when the new recoveries exceed the new cases.

Both China and South Korea reached the golden cross. China reached the golden cross on Feb 18 and South Korea on March 13. China reached this by social distancing, lockdowns, monitoring citizens, punishments, and rewards for obeying the rules. South Korea reached this point through mass testing.

In Italy, also the recoveries exceeded the new cases. Kerala and Haryana also have recoveries, exceeding the new cases.

What happens when India reaches the golden cross?

When India reaches the golden cross, everything will be slowly back to normal. Economic activities and businesses resume in a phased manner and the stock markets will be set for recovery. Many corporates have no clue about their business plans. Because of the lockdown, people are not planning for long-term. They have no proper visions and hence no proper results.

At first, Tamil Nadu had a lot of confirmed and active cases and an increase in new cases. But now the recoveries are more than the active cases. If the active cases slowly reduce and the recoveries increase, then it becomes manageable, i.e when the new recoveries exceed the new cases.

Slowly the lockdowns will get relaxed. Might be it will take a few more months or weeks to get back to normal. Once we come to this golden cross points, Indian corporate leaders will be able to plan for long-term. They will have clear vision which can intrun bring clear results. This will bring back the hope and the stock market will start to recover even better.

You can also read the following series of articles to discover how to recover your portfolio faster and better from the market crash:

How To Make Your Portfolio Recover Better & Faster From the Stock Market Crash? (Part 1)

How To Make Your Portfolio Recover Better & Faster From The Stock Market Crash—Part-2: Discover The Rewarding Nature of Portfolio Rebalancing

How To Make Your Portfolio Recover Better & Faster From The Stock Market Crash—Part-3: Play Smart with Your SIP: Stop or Continue or Increase?

The recoveries are not the only good thing that’s happening. There’s more to it.

Let’s see the positive developments during this corona crisis:

1. Low-interest rates

Reserve Bank of India changed the monetary policy to prevent economic collapse and to help liquidity in the economy. This time the loans have a lesser rate of interest. This adds to the advantage of the borrowers.

Businesses and farmers benefit, as they get business capital at a lesser rate which in turn increases production and output. Consumers pay less interest, this gives them more money to spend, which in turn increases sales. This, in turn, helps the companies and hence helps the stock market.

Investors and economists view this as a benefit to personal and corporate borrowing as it leads to economic growth. Low-interest rates hence help the stock market bounce back.

2. Fiscal Stimulus

The government financially stimulates an economy to kick-start growth during this time of crisis. It also credits money into the accounts of the poor to support businesses hit by the lockdown. India announced a $22.5 billion stimulus package to help people affected by lockdown.

3. Cheaper fuel prices

For crude oil-importing countries like India, it is a boon as it helps bring down our account deficit, fiscal deficit, and inflation. It reduces India’s foreign currency outflow, and interest rate pressure. It brings back economic activity and boosts the Indian Economy.

Eg: For every 1$ reduction in Crude, Rs.11,000 Crore is a benefit. So wherever crude oil is used, the production charges reduce and the product cost also reduces. Those goods would be available at cheaper prices.

4. Recoveries and normal functioning

In China (where the first corona case started), people recovered in large numbers. There are no fresh cases and death rates have come down. Most of the outlets are open again and are functioning as normal. This is one of the positive signs that we too will reach this position sooner and everything will get back to normal.

5. India’s GDP in 2021

All the countries’ GDP has come down due to recession. The International monetary fund (IMF) projected India’s growth at 7.4% in 2021. Amongst Emerging Market and Developing Economies (EMDEs) after Bangladesh and China, India stood third with the highest projected GDP for the year 2021.

GDP for the year 2021

Also read,
“Attention Investors! Want To Take Unfair Advantage of the CoronaVirus Crash? You Are Just One Step Away”

Conclusion

“We can complain because rose bushes have thorns, or rejoice because thorns have roses.” ― Alphonse Karr.

When there is a lot of bad stuff happening around, we fail to focus on the good. It is the same case here, as we were too involved in the bad news, we missed the good news. It’s time we talk about the positive things happening, rather than just focusing on the negative.

If you have any comments or questions, write them in the comment box below.

Or are you interested in creating a Comprehensive Financial Plan for your financial goals?

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Jey S
Jey S
24. September, 2021.
I have been using Holistic Investment Planners for the last three years. Mr. Srinivasavaradhan answered all my questions and doubts very patiently during the first free consultation. I was able to clearly define my short-, medium- and long-term goals once I signed up for the comprehensive plan and got their investment plan suggestion to achieve my goals. They are very polite and highly professional whenever I contact them for any queries or make investments. They never pressurize you to invest on their recommended financial products. I would have been lost money by investing directly without their help since I do not have time and knowledge about different financial products. Risk planning is also done as part of financial planning. Truly, they are holistic planners when it comes to your financial planning. They help you to define your life goals, understand your financial resources and establish a plan to invest towards reaching those goals. They do review your plan as you progress to make sure that you are on correct path to achieve those goals. Kudos to the team and keep up the good work!!! I am happy that I found holistic investment planners for my financial planning and management.
aksaswadkar
aksaswadkar
24. September, 2021.
I was about to retire and really not understanding how to invest money to have financial freedom and fulfilling my goals. Was desperately searching on internet way out and fortunately came across Holistic Investment Planners. I read number of articles on their website and realized that this is the agency which I want and engaged their services for my retirement planning. It is an excellent experience to be associated with Holistic. Right from day one our interaction was fantastic and they gave me such a wonderful plan that I had never imagined. I am fortunate enough to be in the client list of Holistic. I have recommended Holistic to my friends as well.
Lionel Faber
Lionel Faber
16. September, 2021.
I've been availing their services for the past year. They are highly knowledgeable in the field and are very patient with all doubts and queries. Personalized financial planning is provided keeping your short term, medium term and long term goals in mind. They do not pressurize you to purchase schemes of their choice. They provide their input and suggestions and leave the decision up to you which shows their honesty and high principle.
Sridhar
Sridhar
8. September, 2021.
Financial planning brings peace in life. Holistic Investment have supported in arriving financial plan based on future goals. My investments are regular since then. They are professionals in their business, will recommend others.
Nitesh Agrawal
Nitesh Agrawal
6. September, 2021.
I have been using Holistic Investment Planners from last one year. The journey has been fantastic. Being a finance person myself I always thought we can look after and plan own finances also. However, due to lack of time and deciplain the things are not always as desired. After joining with Holistic Investment for the first time Icame to know the Financial goals and quantified them. Some dreams were unrealistic based on the earnings and savings so had a reality check. Also got the information and deciplain of investing on regular and more rewarding securities. I definetly suggest to use Holistic Investment Planners. They are professionals, available and hear youor full story before presenting plans. They are flexile in the sense if there are some urgent deviations required, they help to plan the same. For all professionals/individuals I would suggest using professional help of Holistic Investment Planners for best results in long term investment and financial goals achivements. Last advise will be to start early in your life. It really pays well to start in the beginning itself else the dreams needs to adjust :)
Swetha Vasanth
Swetha Vasanth
6. September, 2021.
This is my first year service with the Holistic Team and I would say that they are very much helpful in creating a financial plan and follow ups during the year. I would definitely suggest them if anyone who is willing to proceed with their savings professionally.
Joseph Mathias
Joseph Mathias
6. September, 2021.
I came to know about Holistic Investment Planners online while searching for different investment ideas. Once I contacted them the journey was very smooth. Mr. Ramalingam explained all the aspects of Financial planning in detail and it opened my mind. I realized how important it is to have a Financial planning. Mr. Rajan suggested all the requirements as per my goals and made a Investment plan keeping in mind of my goals. I started my Investment journey with them. I wish I had done it some years back then it would have been in a different level. Review meetings were held every six month to check the implementation of the plan and check the results as per the requirements and to check if any changes required. Overall it was a good experience with Holistic Investment team and would like to continue in the years to come.
Srinvas Kannan
Srinvas Kannan
30. July, 2021.
I came across Holistic investment planners almost 5-6 years back, but I did not have the trust since I had met a few of them who did not sound promising. Then I started investing through a financial advisor of my friend. After 4 years of investing the returns were very low. I was disappointed and started looking for financial advisors when I came across Holistic investment. I had a detailed discussion about my goals and the way they would approach achieving my goal before deciding to switch my investments to them. After a thorough analysis of my then existing portfolios, they suggested new ones and we zeroed-in on 6 schemes/funds where our investment would be split. I am glad I made the decision of switching over and taking Holistic planner's advise, my returns are handsome and I only wish I could have taken their help/advise 5 years back itself. Neverthless, I would like to recommend their services for investment and financial advise if someone is serious about their investments.
Shivaram Andiappan Selvaraj
Shivaram Andiappan Selvaraj
3. July, 2021.
I got a free first time consultation. I got my doubts resolved. They also gave additional advises for investment planning which was also useful.
Nellai B
Nellai B
26. June, 2021.
I have been associated with them for the past three years. They are very professional and polite in answering all our questions. I have complete trust in their suggestions. I strongly recommend for anyone. I am looking forward to have strong and successful association with them.
Google rating score: 4.4 of 5,
based on 61 reviews

Google Reviews

Jey S
Jey S
24. September, 2021.
I have been using Holistic Investment Planners for the last three years. Mr. Srinivasavaradhan answered all my questions and doubts very patiently during the first free consultation. I was able to clearly define my short-, medium- and long-term goals once I signed up for the comprehensive plan and got their investment plan suggestion to achieve my goals. They are very polite and highly professional whenever I contact them for any queries or make investments. They never pressurize you to invest on their recommended financial products. I would have been lost money by investing directly without their help since I do not have time and knowledge about different financial products. Risk planning is also done as part of financial planning. Truly, they are holistic planners when it comes to your financial planning. They help you to define your life goals, understand your financial resources and establish a plan to invest towards reaching those goals. They do review your plan as you progress to make sure that you are on correct path to achieve those goals. Kudos to the team and keep up the good work!!! I am happy that I found holistic investment planners for my financial planning and management.
aksaswadkar
aksaswadkar
24. September, 2021.
I was about to retire and really not understanding how to invest money to have financial freedom and fulfilling my goals. Was desperately searching on internet way out and fortunately came across Holistic Investment Planners. I read number of articles on their website and realized that this is the agency which I want and engaged their services for my retirement planning. It is an excellent experience to be associated with Holistic. Right from day one our interaction was fantastic and they gave me such a wonderful plan that I had never imagined. I am fortunate enough to be in the client list of Holistic. I have recommended Holistic to my friends as well.
Lionel Faber
Lionel Faber
16. September, 2021.
I've been availing their services for the past year. They are highly knowledgeable in the field and are very patient with all doubts and queries. Personalized financial planning is provided keeping your short term, medium term and long term goals in mind. They do not pressurize you to purchase schemes of their choice. They provide their input and suggestions and leave the decision up to you which shows their honesty and high principle.
Sridhar
Sridhar
8. September, 2021.
Financial planning brings peace in life. Holistic Investment have supported in arriving financial plan based on future goals. My investments are regular since then. They are professionals in their business, will recommend others.
Nitesh Agrawal
Nitesh Agrawal
6. September, 2021.
I have been using Holistic Investment Planners from last one year. The journey has been fantastic. Being a finance person myself I always thought we can look after and plan own finances also. However, due to lack of time and deciplain the things are not always as desired. After joining with Holistic Investment for the first time Icame to know the Financial goals and quantified them. Some dreams were unrealistic based on the earnings and savings so had a reality check. Also got the information and deciplain of investing on regular and more rewarding securities. I definetly suggest to use Holistic Investment Planners. They are professionals, available and hear youor full story before presenting plans. They are flexile in the sense if there are some urgent deviations required, they help to plan the same. For all professionals/individuals I would suggest using professional help of Holistic Investment Planners for best results in long term investment and financial goals achivements. Last advise will be to start early in your life. It really pays well to start in the beginning itself else the dreams needs to adjust :)
Swetha Vasanth
Swetha Vasanth
6. September, 2021.
This is my first year service with the Holistic Team and I would say that they are very much helpful in creating a financial plan and follow ups during the year. I would definitely suggest them if anyone who is willing to proceed with their savings professionally.
Joseph Mathias
Joseph Mathias
6. September, 2021.
I came to know about Holistic Investment Planners online while searching for different investment ideas. Once I contacted them the journey was very smooth. Mr. Ramalingam explained all the aspects of Financial planning in detail and it opened my mind. I realized how important it is to have a Financial planning. Mr. Rajan suggested all the requirements as per my goals and made a Investment plan keeping in mind of my goals. I started my Investment journey with them. I wish I had done it some years back then it would have been in a different level. Review meetings were held every six month to check the implementation of the plan and check the results as per the requirements and to check if any changes required. Overall it was a good experience with Holistic Investment team and would like to continue in the years to come.
Srinvas Kannan
Srinvas Kannan
30. July, 2021.
I came across Holistic investment planners almost 5-6 years back, but I did not have the trust since I had met a few of them who did not sound promising. Then I started investing through a financial advisor of my friend. After 4 years of investing the returns were very low. I was disappointed and started looking for financial advisors when I came across Holistic investment. I had a detailed discussion about my goals and the way they would approach achieving my goal before deciding to switch my investments to them. After a thorough analysis of my then existing portfolios, they suggested new ones and we zeroed-in on 6 schemes/funds where our investment would be split. I am glad I made the decision of switching over and taking Holistic planner's advise, my returns are handsome and I only wish I could have taken their help/advise 5 years back itself. Neverthless, I would like to recommend their services for investment and financial advise if someone is serious about their investments.
Shivaram Andiappan Selvaraj
Shivaram Andiappan Selvaraj
3. July, 2021.
I got a free first time consultation. I got my doubts resolved. They also gave additional advises for investment planning which was also useful.
Nellai B
Nellai B
26. June, 2021.
I have been associated with them for the past three years. They are very professional and polite in answering all our questions. I have complete trust in their suggestions. I strongly recommend for anyone. I am looking forward to have strong and successful association with them.
Google rating score: 4.4 of 5,
based on 61 reviews

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