Industry Cycles

Hi, I'm Phil Town. Today, we're talking about how industry cycles affect investing. So let's j Well, if you're working in the world, you probably have an idea that industries go through ups and downs, and so does the stock market. It goes through highs and lows. In fact, all the way back in the 1930s, the guy who founded this type of investing, Rule 1 investing, Ben Graham, who is Warren Buffett's teacher, by the way, said that really it's just about following market fluctuations. So yes, we should be probably paying attention to the market ups and downs, to the industry ups and downs. And the reason why is because the essence of great investing, Warren Buffett boiled down to this. We want to sell when there's greed, and we want to buy when there's fear. And these cycles are cycles of greed and fear. Whenever the world's going really good, everybody gets more greedy, things are getting better and better. I'm going to buy the market. Everybody can make money. It's just I'll just buy because my neighbor's made a fortune. So that happens in all markets, and that greed starts to stimulate a market to a point where people are paying way too much for the assets that they're getting. And then eventually that bubble pops, and it gets more and more scary as we come out of a pop bubble. People sell off everything We might be heading for one of those things in the near future right now, right? So when that happens, then fear starts to get more and more. People are afraid of losing their retirement. They're afraid of what's going to happen in the future. And everybody gets short-term thinking about, oh, I got to get out of this. And they sell things for super low prices. And that is working to our benefit. So we follow Warren and just we sell when things get pricey and it's greedy, and we buy when there's fear in the market. Well that's it for this week's video. If you're new here or if you found this helpful, just subscribe to our channel for more education Thanks. Bye.