The fundamental reason for the sharp decline in U.S. stocks is that the bubble is too big. During the epidemic, the U.S. economy has declined and stagnated. In order to save itself, the Federal Reserve has been releasing water to stimulate the economy. Most of the money printed out of thin air will flow to the hands of companies. Companies use this money to continuously buy their own stocks, pushing up stock prices.

What happened behind the sharp decline in U.S. stocks?

Musk, the world’s richest man, predicted that a new round of financial crisis in the United States will definitely occur in the spring and summer of 2022, or 2023 at the latest. In this prediction, Musk believed that the coming of the U.S. financial crisis would be inevitable. However, coincidentally, the Indian prodigy had made the same prediction earlier, and it was highly consistent with Musk's prediction.

Of course, investors cannot use their real money to believe empty words. However, an earlier survey conducted by the US consumer news and business channel "CNBC" showed that at least half of the people believe that there will be high inflationary pressure on the economy in 2022, and are also worried that the Federal Reserve will carry out a large-scale interest rate hike this year. In other words, judging from the survey, it is obvious that the public is not optimistic about the future of the U.S. stock market and lacks confidence in continuing to rise. This undoubtedly makes investors lose the confidence to continue to be bullish, because they invest to make money. If they can't see hope, they can only leave the stock market and invest their money in other more stable places.

However, 2022 has had a bad start. While the epidemic is still raging around the world, the Russia-Ukraine conflict suddenly broke out, further throwing the global financial order and business investment into chaos. Withdrawals are being withdrawn and moves are being moved. The global stock market is jumping up and down, and the fluctuations are very violent. The most intuitive feedback on this is that the virtual market risk has suddenly become greater. After the superposition of various factors, rather than continuing to stay in the market and experiencing unknown risks, it is most prudent to temporarily leave the market.

Why does this happen? 2 reasons!

1. Unsatisfactory economic data

The U.S. ISM manufacturing index for April released overnight unexpectedly fell to the lowest level since 2020, making the market more pessimistic about the future. In addition, the GDP data just released was lower than expected, which is why the market is worried about the U.S. economy.

2. The Federal Reserve raises interest rates

In the early morning of Beijing time, it is the time when the Federal Reserve’s interest rate decision is announced. The market generally expected a rate hike of 50 basis points. If the rate hike tonight is as expected, 50 basis points, it will be good for the market. If the interest rate hike is lower than 50 basis points, it will be a big plus, and the market will start a counterattack to vent its depression; if it exceeds 50 basis points, after all, Australia is proofing, it may cause panic in the market and the stock market will plummet!

What should we do in a crisis?

As ordinary people, we can improve ourselves in these two aspects and avoid the adverse consequences and chain reactions caused by the crisis.

First, improve your core competitiveness and various skills to ensure that when encountering a wave of unemployment, you can avoid being eliminated by the company; second, have an overall view and rational consumption to retain enough cash flow to prevent loan consumption from getting into trouble.

1. Improve core competitiveness and various skills: We all know that the current workplace is becoming more and more cruel. With the rise of individuals and the recruitment changes in the talent market, the irreplaceability of some people is declining. There are so many competitors, why should the company keep you and reuse you? "You" must have irreplaceable core competitiveness and continue to create value for the enterprise.

Another aspect of the crisis is opportunity. Under the impact of the epidemic, only our country can make such wise decisions and handle it correctly. I believe that we are constantly rising amid the epidemic!