Why Markets Crash In The Fall, The Luck Of Bill Gates (w/ Morgan Housel), Why We Don't Set Goals For Our Advisors

The Compound and Friends

Josh Brown

Business News, News, Investing, Business

4.7 • 2.2K Ratings

🗓️ 11 September 2020

⏱️ 68 minutes

🔗️ Recording | iTunes | RSS

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Summary

This week on The Compound Show - why investors and market watchers are captivated by the months of September and October. Plus, Josh talks with Morgan Housel about the stupendous luck of Bill Gates, the piracy of Cornelius Vanderbilt and what we need to know about the Psychology of Money. Morgan's new book is now available wherever fine books are sold (or downloaded). Plus, the message Josh gave his firm's employees on the eve of their seventh anniversary, and why there are no goals set for financial advisors who work there. Leave us a rating and review, they really go a long way! Hosted on Acast. See acast.com/privacy for more information. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Hey guys it's downtown welcome back hope you're well rested hope you're ready for
0:06.3	fall we had a pretty nasty sell-off at the end of last week continuing into this week and then a little bit of a recovery, but many of the
0:16.4	highest flying tech stocks fell 15 or 20 percent, even the really big ones like Apple.
0:23.0	Tesla was down about 34% from its all-time high
0:28.0	into the low point, which I think was Tuesday of this week,
0:32.0	or yesterday. Seasonally speaking, September and October, like
0:37.4	right around this time of year, loom large in the imaginations of market watchers. People that know the history, they look out for these two
0:46.5	months. The peak for the stock market back in 1929, after going up hundreds of percentage points happened right around now.
0:56.2	It was right before Labor Day weekend of that year that stocks just after years and years just magically stopped going up.
1:05.6	Nothing specifically happened.
1:07.6	People just seem to have returned from the beach
1:10.6	and decided not to pay higher prices anymore. And that was the stock market top.
1:17.0	A few weeks later the crash came. Now there wasn't any significance about either the day the market stopped going up after Labor Day or the day it decided to crash.
1:30.0	I wrote a book about stock market pundits throughout history and when you do the historical
1:35.8	research it's very clear that no one in particular had seen the crash coming and there
1:42.4	wasn't really any news that caused it. The closest
1:45.9	thing we have as an answer as to why the market might have crashed in October of
1:52.4	1929 is actually pretty flimsy. There was a guy
1:56.2	named Roger Babson who was a big-time business and finance guru and he was giving a speech that happened to have been broadcast onto the
2:06.4	New York Stock Exchange during the week of the crash and he was giving this
2:11.4	speech from hundreds of miles away up in Massachusetts where his namesake college still stands, right, Babson College? That's the guy.
2:21.0	Some of the things he was saying were hitting the primitive the the market action that week to Babson's remarks and giving him the credit
	...

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