Stock Market: Warren Buffett Shows Us How to Make Money
After having spent more than 70 years in the stock market and having earned a fortune from past crises, Warren Buffett is the right man to learn about investing from. After the March 2020 stock market crash, most analysts, including me, were anticipating another crash. But that’s the thing with a crash: you don’t know when and how it will come. How does Buffett make money in a correction?
The stock market crashes when a macro event blurs the future of business and creates panic among investors. If you are expecting the worst, you have already priced in your fear in the stock price. For instance, in the March 2020 crash, there was a sudden surge in the coronavirus cases, and all major economies announced nationwide lockdowns. This blurred the future of business.
At times of crisis, people lose trust in the market and other investment instruments. Hence, they pull out all their cash and invest in gold. As the stock market sees a huge outflow of money, it crashes.
Last year, the stock market recovered quickly after the March …
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