In a recent article, Ted Bauman investigates three possible scenarios that could lead to a stock market crash. Ted argues that although the current bull market may continue, the odds are likely to plummet. Ted, who studied in South Africa and moved to the United States, is likely to be right because of the valuable, proven success and his focus on low-cost housing projects. Ted Bauman has a good track record of helping over 14 million people in several countries.
— Ted Bauman Guru (@TedBaumanGuru) December 3, 2018
Ted states that three possible scenarios will cause the stock market to crash: –
1. Return to Average Ration
Ted often states that the market in the United States is overhauled. He uses the CAPE ratio, which compared corporate earnings to the prices of the stock to point out that most companies have a higher CAPE ratio. But Ted Bauman argues that the market will return to standard ration after a year or so, and this could have some effects to the stock market.
The first effect as Ted Bauman describes it is that investors might fear that they will not get their dividends and thus pull out. Alternatively, Ted says that the asset might be more appealing and therefore attract more investors.
2. Yield Curve
The second scenario that Ted Bauman describes is that of investors recognising the yield curve and thus invest in short-term interest rates. Ted argues that if a significant shift is to happen, then there would be an impeachment following several proceedings, which would, in turn, hurt the economy over the next several years.
3. Crash and Bounce Scenario
Lastly, Ted explains the crash and bounce scenario. A typical situation for that is expected to happen in a market where nothing is going wrong. An excellent example that Ted gives is a similar incident that took place in 1987 when there was the most significant one-day percentage drop for Dow Jones Industrial.
The Work and Life of Ted
Ted is a financial analyst and editor for several publications that have thousands of subscribers per month. Due to his unique educational background in South Africa, Ted manages to provide extensive knowledge to his readers through Banyan Hill Publishing and The Bauman Report.
Read More: www.gold-eagle.com/authors/ted-bauman