Can the Stock Market Really Go Up Forever?

In the 1960s, economists popularized a theory called the “efficient market hypothesis” that became a foundational belief behind modern investing. But now, according to a new economic theory, some believe that the EMH might be fundamentally flawed.
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[@ChrisThomas-m6q]

I feel investors should be focusing on under-the-radar stocks, and considering the current rollercoaster nature of the stock market, Because 35% of my $270k portfolio comprises of plummeting stocks which were once revered and i don't know where to go here out of devastation.

[@ErinWarner-zc9jy]

I think the next big thing will be A.I. For enduring growth akin to META, it's vital to avoid impulsive decisions driven by short-term fluctuations. Prioritize patience and a long-term perspective most importantly consider financial advisory for informed buying and selling decisions.

[@annaj.osorio]

A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.

[@MagnusLarson-l1o]

This is definitely considerable! think you could suggest any professional/advisors i can get on the phone with? i'm in dire need of proper portfolio allocation

[@annaj.osorio]

“Viviana Marisa Coelho” is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment

[@Robbertskypes]

She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.

[@donovantobs]

I feel investors should be focusing on under-the-radar stocks, and considering the current rollercoaster nature of the stock market, Because 35% of my $270k portfolio comprises of plummeting stocks which were once revered and i don't know where to go here out of devastation.

[@rachelonigirl]

Thats when you hire someone to manage your money. You need a financial-advis0r straight up! Even while $270k might seem like much, one bad decision might seriously deplete it.

[@Monicamonasky-]

A good number of people discredit the effectiveness of financial advisors in exploring new markets, but over the past 10years I’ve had a financial advisor consistently restructure and diversify my portfolio/expenses and I’ve made over $3million in gains… might not be a lot but i'm financially secure.

[@kurtKking]

Could you possibly recommend a CFA you've consulted with?

[@Monicamonasky-]

Her name is. TRUDY ELIZABETH STOUFFER . Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

[@kurtKking]

I just curiously searched her up, and I have sent her an email. I hope she gets back to me soon. Thank you

[@brianwhitehawker1756]

My portfolio for the past 30 years has always been self managed and I own 3 shares of Berkshire Hathaway Class A stock (BRK:A) which I bought in at about $17,000 during the mid 90s, I'm currently liquidating some of these positions to incoporate new Gen. Stocks, any good stock recommendation on great performing stocks will be appreciated.

[@Jadechurch-ql3do]

It’s precisely at times like these that investors need to be on guard against the next certainty. You don’t have to act on every forecast, hence i will suggest you get yourself a financial-advisor that can provide you with entry and exit points on the shares/ETF you focus on.

[@yeslahykcim]

You have a very valid point, I started investing on my own and for a long time, the market was really ripping me off. I decided to hire a CFA, even though I was skeptical at first, and I beat the market by more than 9%. I thought it was a fluke until it happened two years in a row, and so I’ve been sticking to investing via an analyst.

[@codeblue11]

impressive gains! how can I get your advisor please, if you dont mind me asking? I could really use a help as of now

[@yeslahykcim]

“Lucinda Margaret Crist” is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment

[@FusunTumsavas-cq7tp]

The market's direction can swiftly change, with indexes frequently transitioning from a bear market to a bull market. It's tricky during election years. I recently inherited a lump sum and want to invest it wisely. Any tips or strategies to take advantage of this potential upswing?

[@RossiPopa]

imho, the average person finds it difficult outperforming the market on a day-to-day basis. In actuality, most people who have the necessary abilities are advisors with experience since the '08 crash and beyond

[@RusuSilva]

Agreed, I once downplayed the role of financial experts until suffering 40% portfolio loss amid 2020 lockdown, at once I consulted a pro and my portfolio was revamped thankfully. As of today, I'm just about 10% shy of my $1m goal after 100s of thousands invested.

[@RichardMoore-jg5tl]

bravo! mind sharing details of your advisor please? my job doesn't permit me the time to analyze stocks myself

[@RusuSilva]

Monica Shawn Marti is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.

[@RichardMoore-jg5tl]

Thanks for the info. I searched for her full name and found her website right away. I reviewed her credentials and did my research before reaching out to her.

[@BrewerVera]

I'm just starting to invest and keep hearing mixed opinions on asset allocation. Some say ETFs and index funds offer great broad market exposure, but I’ve also heard they include underperforming stocks that could dilute returns from stronger performers. Since my goal is to retire early, I’m not sure if I should be more selective with my choices now, or if I’m just overthinking it

[@chris-pj7rk]

I think the next big thing will be A.I. For enduring growth akin to META, it's vital to avoid impulsive decisions driven by short-term fluctuations. Prioritize patience and a long-term perspective most importantly consider financial advisory for informed buying and selling decisions.

[@johnlennon232]

A lot of folks downplay the role of advlsors until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for licensed advisors and came across someone of utmost qualifications. She's helped grow my reserve notwithstanding inflation, from $275k to $850k.

[@jameswood9772]

This is definitely considerable! think you could suggest any professional/advisors i can get on the phone with? i'm in dire need of proper portfolio allocation

[@johnlennon232]

“Amy Desiree Irish” is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment

[@jameswood9772]

She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.

[@socoblah]

So, in summary.....be skeptical of index investing, but you should invest your money in index funds. Thanks, that clears things up.

[@getpaid.gohome4506]

😂😂😂 This comment got me!

[@ttopero]

Trust but verify

[@3KAlexander]

I know, what's the takeaway here?

[@ricardoamendoeira3800]

The takeaway is to understand what you're putting your money into.

[@drewmqn]

1) there's (probably) a systemic risk to folks blindly buying. 2) if everyone tries just a little to put their money in areas where they are knowledgeable, there will be less risk

[@Breakfasttime630]

That’s 14 inconclusive minutes I’m never getting back

[@charliesullivan4304]

But during those 14 minutes, the stock market has risen, so we're all better off.

[@BrokeAgain]

thanks for this! didnt waste my time

[@faxexmachina921]

Welcome to economics!

[@imgorgeous03]

glad i wasn't the only one thinking that

[@Daniel-tx2vt]

The love for easy fast answers will be the death of this species I swear.

[@MarjorieRyanJoy]

I'm just starting to invest and keep hearing mixed opinions on asset allocation. Some say ETFs and index funds offer great broad market exposure, but I’ve also heard they include underperforming stocks that could dilute returns from stronger performers. Since my goal is to retire early, I’m not sure if I should be more selective with my choices now, or if I’m just overthinking it

[@MaxWell-pp9zs]

I’m nearing retirement myself, and I had similar concerns. I started investing later than most, and just relying on ETF compounding wasn’t cutting it for me either. After working with a financial advisor, I managed to restructure my investments and am now on track to retire with around $4 million. If I hadn’t sought advice, I doubt I’d be as confident in my plan right now

[@MarjorieRyanJoy]

I’m trying to figure out the best approach for my portfolio. How did you find your advisor? I feel like I need that kind of guidance

[@MaxWell-pp9zs]

I usually steer clear of recommending specific people because financial needs are so personal. But I can say that working with Emily Ava Milligan has made a world of difference for me. I noticed her strategies are tailored to fit personal goals and make sense for different needs. It might be worth exploring to see if her approach resonates with you

[@MarjorieRyanJoy]

Thanks for that. I did a quick search and found her page. I was able to email so I sent over a few questions to get more info. Appreciate you sharing

[@nonsensehelix]

this is a scam btw, all accounts are bots

[@closeben]

Makes a big deal about interviewing his school econ teacher and then barely shows any of it. This hyperedited video seems far more focused on being a KZbin video than being an informative one.

[@Skilliard]

If you want more informative videos on the topic, I recommend looking up Ben Felix. He covers the topic of index funds quite well.

[@MIKAEL212345]

so funny. they set up the whole thing, film the b-roll of them walking in and then cut from him speaking after he speaks one sentence. That same sequence could literally be used in a parody youtube video

[@mikeg9b]

That's what most of KZbin is now.

[@nicholaslogan6840]

what an annoying video

[@mikeg9b]

Especially the little skits.

[@Avo7bProject]

It attracted plenty of bots in the comments, though.

[@TheScourge007]

This video has a very high potential to mislead people into making really irresponsible investment choices. The idea that the efficient market hypothesis is not true in an absolute sense has nothing to do with what normal people should be doing with their investments. Because for people who aren't math geniuses with subscriptions to Bloomberg terminals and an ability to code trading algorithims, we are so outclassed by actual professionals that active trading is just a fast way to throw away your money. It's like being a fish at a poker table full of sharks. And the level of detail in this video is FAR too low to really provide any guidance in active investing. I hope average people basically ignore the anti-index part of this video because none of us are going to consistently out guess the trading strategies of people who spend nearly every waking moment trying to work out their strategies, nor are we going to have a good idea of what makes a good active manager of our money.

[@yeetboi268]

You're expecting too much from Morning Brew

[@thunderb00m]

Way to miss the point. No one told people to actively trade but rather consider active funds , of which there are many rather than putting everything into passive index funds. That is if you do your research and believe that the hypothesis is wrong in which case actively managed funds should beat passive ones because of their edge. There is some limit to how much value as a percentage can be held passively. Beyond that it would absolutely make no sense and active funds are needed. But no one knows what that limit it is, some say its 50%, some say much higher. If all funds are held passively then a small number of transactions could cause large swings in value because the free float is so small.

[@TheScourge007]

@@thunderb00m I'm not missing the point as you may notice I also talked about how it's unrealistic to expect viewers to know the difference between a well managed active manager and the average bad active manager. because most active managers under-perform indexes. And the point about "what if a lot of people pull their money out at the same time", that happens under active management too! Literally happens every time there is a recession. That is not an argument against passive management! Further, active management includes that done by massive pension funds or closed funds of super geniuses like the Medallion Fund. Those are plenty big institutions that trade so much more than passive funds do that they could be a small fraction of total funds and still a majority of trading decisions, like the video even acknowledges. Finally, even if we did reach a point where indexes were distorting the market's ability to do price discovery, that doesn't mean it would be a good idea to go into active management with your portfolio. Because unless your active management can take advantage of that faster and smarter than massive institutions and smaller but incredibly skilled closed funds, your portfolio is still on the losing end of that competition. And as your results get eaten alive by super-high information, super-high skill, super-fast response time algorithms from the world's best traders, other passive investors will decide to not follow in such a failing strategy. So at that point, if we think it's important to reduce passive investing to keep market price discovery working, the only answer is using an organization that can force coordination across hundreds of millions of people: the government. And the obvious way to do that would be to shift the tax system into pension plans or sovereign wealth funds that both have the resources to actively trade with high knowledge and skill, and can absorb large amounts of starter funds. But just telling people to make decisions that for the average investor are worse for their financial health is a terrible idea.

[@IakonaWayne]

These professionals you speak of often underperform the market themselves, only special hedge funds and family offices consistently outperform .

[@bio-hazzard1233]

@@thunderb00m I thought etfs are constantly buying and selling the individual stocks to have the right percentage balance; so how would the price be volatile due to low volume?

[@cetriyasArtnComicsChannel]

Ok. Do we have other choices? How do we prep for retirement?

[@ster2600]

Real estate presents one alternative, though it's also volatile and potentially in a bubble for the very same reasons

[@tianlechen]

Buy things that actually contribute to your retirement like housing, insurance or healthcare. Or high interest savings.

[@jemiez9383]

Start to diversify your investment. Buy foreign countries stocks and other assets to mitigate the risk of losing it all in The US. The US moment as the hegemony is disappearing and weakening as time passed by.

[@Thebt7]

Step 1: maximize your income potential (if you haven't already) i.e. what's the highest paying role you can achieve in your career or starting a small business based on proven business model (what ever you can do to bring income into your house for as long as possible) sounds simple and obvious but plenty of people get laxed from 30-50. Go home watch tv all evening, don't learn any new skills, do the minimum at their job etc etc step 2: don't always follow the market (diversification to build wealth at the start is not your friend) concentrate on your circle of competence when investing. If you have a particular skill then look at companies which that skill will give you advantage in knowledge and know how of what makes that business or industry tick. Something that an analyst sitting in wall street wont know. We now have access to plenty of local investments via fractional share apps. step 3: once you have investments and they are growing and only once you are nearing your target retirement amount that's when you focus on diversification. Bonds, cash, property etc. Its not always wish to buy a property early on in your investment journey if that means you are borrowing way too much and at waay to high interest rates. Debt to equity ratios matter to give your investment portfolio the right amount of leverage. The current issue with the investment meta (other than passive stock investing) is borrowing alot and buying property. This second meta is banking on inflation growing and growing year on year end to deflate the debt away. $500k loan wont seem like much in 25 years when the average starting wage goes up (which it does just slowly). The issue for people as been not switching jobs and staying at the same company forever and not getting wage increases marked to market.

[@Eikomaniac]

diversify! if you can afford it, keep investing and reap the immense benefits 10+ yrs down the line. otherwise just hold back for a bit with bonds or the like, safer investments, till you feel more comfortable to invest in the market again

[@seyiagboola]

I can't believe they skipped over the actual reason why the market might be inflated by 500x

[@wentan7]

Honestly there really no other or better way. Most of us have a long time horizon of investing. If it does crash 20-50% most of us are ok with waiting 5 year for it to recover. For older folks in retirement i hope they diverfied in low volitility fixed income assets.

[@CL-yp1bs]

Yes sir, big crash is when I will take up a second job to buy buy buy more... wait it out, and meet you on the other side :)

[@Rick_Cooks]

@@CL-yp1bs Be glad if you get to keep your main job if a big crash actually happens

[@KSS184]

It’s not just 500 biggest companies. There are requirements for a company to be even considered to be a part of sp500, such as four consistent quarters of profitability. Annually approx 25-30 companies are dropped/replaced. It’s the winners club, that’s why it’s going up.

[@antiquehealbot6543]

To a certain degree, yes. But VTI which follows the entire US stock market has very similar performance. Standard&Poors are not doing much work.

[@stevenparkison7780]

1:05 host discovers what an exponential function looks like. Fun fact, compounding interest is also an exponential function. It shouldn´t be surprising that the market's value also increases exponentially, over long periods.

[@nicolasgirard2808]

Will it keep increasing when the population starts falling?

[@yeetboi268]

@@nicolasgirard2808 population isn't the only factor for increase/decrease of productivity

[@nicolasgirard2808]

@@yeetboi268 no but it means less customers for businesses to sell to and less workers to supply those goods. Overall a shrinking economy is likely if the population is shrinking.

[@TheModeler99]

@@nicolasgirard2808 Exactly, growth will definitely slow down drastically as population crisis hits. My strategy is to assume a low rate of return. SP500 is 10%, I estimate 5% for myself

[@ELIjuzDatBOy]

People dont understand that the prices of things are never going back down. This inflation is deeper than we think. Those buying groceries are well aware that the real inflation is much over 10%. The increments dont match our income, yet certain investors still earn over $365,000 in stocks and assets. Wish I could accomplish that.

[@TerranceAblao]

Very possible! especially at this moment. Profits can be made in many different ways, but such intricate transactions should only be handled by seasoned market professionals.

[@moparalex]

Brian demonstrates an excellent understanding of market trends, making well informed decisions that leads to consistent profit

[@henrycbn]

I'm surprised that you just mentioned and recommend Mr Brian Nelson. I met him at a conference in 2018 and we have been working together ever since.

[@MankerRalph]

Any specific guide. I'm from Georgia how do I go about this? I think I'm interested how can I get in touch with Mr Brian Nelson

[@moparalex]

he's mostly on Telegrams, using the user-name

[@notKhalid]

the exponential growth you're referring to in the beginning of the vid by pointing at the graph should not be the reason to delve into this issue, what you showed was just compounding asset plotted on a graph, that curve always stays the same 😂

[@benitabussell5053]

Market highs are often followed by corrections but timing them is difficult. Some analysts predict a "massive" correction, making me consider adjusting my $850k portfolio or exploring defensive investments.

[@RickWatson-xu6gw]

Consider diversifying your portfolio with a mix of stocks and stable assets. Seeking professional advice now could provide valuable insights and strategies to navigate market uncertainties and protect your investments.

[@A_francis]

Having an investment advisor is the best approach to the stock market right now. I was going solo without much success until my wife introduced me to an advisor. I've achieved over 80% capital growth this year, excluding dividends.

[@RobbStonee]

Pls how can I reach this expert, I need someone to help me manage my portfolio

[@A_francis]

*Marissa Lynn Babula* is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.

[@ScottStraw]

Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon.

[@karlxmit]

Yes, but we should look at it in constant dollar ie against inflation.

[@realharo]

Overall productivity can go up, with innovative companies and technological advances.

[@kyrond]

Also at logarithmic scale. Increase from 10$ to 20$ is much more than 1000$ to 1500$, but at the scale 10->20 will look completely flat.

[@TheOOOOOOOOOOOOOOO]

​@@realharo do real wages go up with increases in productivity?

[@tren-y2m]

S&P goes up at an average 11% compared to inflation which grows at an average of 2.34% over the last 20 years. I get what you are saying, but it doesnt apply here

[@snwbm]

That depends on weather the productivity increases are due to experience and talent, or technology. A person with experience and or talent can absolutely receive higher wages for their productivity.​@TheOOOOOOOOOOOOOOO

[@scottarmstrong11]

Newbies need to learn the ropes, know how much risk they can handle and diversify their portfolio. Some folks get help from money experts or do their homework before making investment moves. It's all about being smart with your funds.

[@emiliabucks33]

Generally , the stock market provides a platform for buying and selling shares of publicly traded companies, offering potential opportunities for investors to grow their wealth, but it's essential to approach it with knowledge and caution.

[@Johnlarry12]

That's correct. At first, I wasn't too pleased with my gains compared to my previous performances, I was doing so poorly, I thought I needed to diversify into better assets, so I got in touch with an investment-advisor. That same year, I pulled a net gain of £550k, which is about 10 times more than I average on...

[@frankbarnes22]

I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?

[@Johnlarry12]

Finding financial advisors like Carol Vivian Constable who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.

[@frankbarnes22]

Wow, her track record looks really good from what I found online. I'll take a chance and see how it goes. Thanks for the info

[@AddilynTuffin]

Is the stock market getting better or this some election time manipulation to entice new investor? My portfolio has done well all year, but now I’m feeling the pinch. My returns have dropped significantly by 6%, and the market’s all over the place. What do i do?

[@PauleAraiza]

IMO this rate cut will a create new buying opportunity, but given the current market uncertainty, have you considered consulting a fiduciary advisor?

[@PapiChulo-t1s]

Over $6 trillion is in money markets earning high interest, but Fed rate cuts will push this money into equities. A crash/recession can be discussed after that shift. My financial advisor has helped me understand the market, gaining 25% this year under her guidance.

[@SlowrideHome91]

@@PapiChulo-t1s I’ve managed my investment portfolio for 10 years. Initially, it performed well, but recently, it has been losing money. I need to find a way to stop these losses and start seeing growth again. How can i reach this advisor?

[@PapiChulo-t1s]

There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Victoria Louisa Saylor ” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look her up.

[@SlowrideHome91]

Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon.

[@mariusfacktor3597]

If you look at the Price to Earnings Ratio (PE Ratio) of the overall market, it's a bit on the high side, but not very far from where it usually is. If passive investing arbitrarily increases the price of S&P500 stocks then we'd see the PE ratios steadily increase. But again, it's in the usual range. Company earnings have been rising and that is the main reason why their stock price increases. Disciplined active investors will stick to value investing and pull out of companies that are overvalued. These companies will fall in market cap as a result and then passive investors will buy less of them.

[@pan_salceson]

Instant downvote for bad X axis in the thumbnail (all dates were 1950). As a data analyst I get easily triggered by this, and it sits badly with an attempt to be data-driven and objective, sorry, guys ): EDIT: Thank you for fixing this! Now I can watch it, downvote removed :D

[@ster2600]

Hahaha well spotted

[@sudo_garrett]

@pan_salceson i think they fixed it.

[@pan_salceson]

@@sudo_garrett YEAH!

[@the1337fleet]

1:28 "why is this happening" Exponential curves are exponential everywhere. If you zoom into the 1980s or 1990s, would we find a similar curve shape?

[@justinmiller7150]

Why is he showing graphs of the market with a linear scale?

[@carultch]

Because logarithmic scales are for people who don't have enough paper to make their point a lot more obvious.

[@richardhudson1243]

Biggest lesson i learnt in 2023 in the stock market is that nobody knows what is going to happen next, so practice some humility and low a strategy with a long term edge.

[@avamadison-r9p]

Nobody knows anything; You need to create your own process, manage risk, and stick to the plan, through thick or thin, While also continuously learning from mistakes and improving.

[@maiadazz]

Uncertainty... it took me 5 years to stop trying to predict what’s about to happen in market based on charts studying, cause you never know. not having a mentor cost me 5 years of pain I learn to go we’re the market is wanting to go and keep it simple with discipline.

[@michaelstrawberry]

Could you kindly elaborate on the advisor's background and qualifications?

[@maiadazz]

Finding financial advisors like Sophia Maurine Lanting who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.

[@saraFinn-u6g]

I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an email shortly.

[@Riggsnic_co]

The average stock in my portfolio has been cut in half, and the only way to make money this year has been to either short or to trade long in very short time frames. I'm still at a crossroads deciding if to liquidate my dipping $117k stock portfolio, what’s the best way to take advantage of this market?

[@stevieDon-c3t]

It’s precisely at times like these that investors need to be on guard against the next certainty. You don’t have to act on every forecast, hence i will suggest you get yourself a financial-advisor.

[@Nicole_Andys]

I agree, having a financial - advisor for investing is genius! Not long ago amidst the pandemic crash in March 2020, I was really having investing nightmare prior touching base with advisor. In a nutshell, i've accrued over $550k with the help of my advisor from an initial $120k investment thus far.

[@Crystal__sage-b7k]

That's impressive!, I could really use the expertise of this advisors , my portfolio has been down bad....who’s the person guiding you.

[@Nicole_Andys]

There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Carol Vivian Constable’’ for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.

[@Crystal__sage-b7k]

Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.

[@pingnick]

Part of the problem perhaps is that you’re not using logarithmic plotting on the early graphs you showed BUT nevertheless important ideas discussed here

[@_santos13]

So… 14:30 of video to say nothing.

[@Linck192]

I looked at the PE ratio chart of the S&P 500 since 2007 and I don't see any clear upward trend, so I don't think the S&P is increasingly getting overvalued because of this culture of index funds

[@osbaldotheVtenman]

I believe that the exaggerated representation of large cap companies within index funds and consequently the large swaths of capital flowing into these companies is not necessarily a problem that is created by index funds, more so just amplified. I think it can be better attributed to our current dominant economic system that not only stands by the wayside as companies unscrupulously collect monopolistic power, but in addition has also historically encouraged said practice. The USA has only recently started to provide more vitality to the long dormant trust busting machine which in the past had successfully made space for other companies to compete and take market share from the big guys. The USA has, for about half a century (if not more), been quite happy to look the other way as long as 'line go up' for the longest. I would argue that the core incentives of a capitalist system are directly opposed to solving this conundrum, but that's another conversation.

[@AndrewMaloney-zi3hi]

"For every $1 entering the market, the overall value of the market goes up $5... So the market is moving 500 times faster" Eh? How did 5x become 500x in the same sentence? And what does "moving faster" even mean?? This video is all hat and no cattle.

[@artemaeus]

Reminds me of how Japan's stock market hit a high in the late 80s/early 90s and only just now is recovered(ish). People always say stonks go up but I dont think that will be true forever.

[@amanasd26]

Must be amazing to have the confidence to put out the most useless nothing burger of a video and pass it off as expertise.

[@GoodnotGreat88]

What I find interesting is that everyone these days says passive beats active, meanwhile 95% of buying and selling is still active and they set the price that all the passive investors pay. On top of that all of the big financial firms still have active trade departments because they believe they can beat the market with active trading.

[@mikeg9b]

A question that could have been asked is, "Why has the U.S. market wildly outperformed just about all other stock markets in the world?" Will this continue? I'm dumping my developed markets and emerging market index funds because their returns have been garbage next to U.S. market returns. And I've had those funds for over 10 years, so the U.S. outperformance is a long-term phenomenon.

[@ILoveTinfoilHats]

Not just the last 10 years. Look at the last 100 years. The US simply has more investment in technology and a freer market.

[@gregmohr9367]

Quality based indexes are nice too. MOAT, COWZ, QUAL, VIGI, VIG

[@JosephDickson]

Not all index funds are created equally. Speculation can and does occur.

[@dandelions907]

As long as someone else is bidding higher than wat I bought it for I'm perfectly fine with it 😅

[@michaelsmith4904]

lol that just supports this video's hypothesis

[@davidnitschmann7857]

you must be trolling

[@nooodisaster]

What am I supposed to do with this information?

[@ricasacasari1883]

Just to be aware that the increase of passive investment using ETFs is increasing artificially the value of stocks and on the milder scenario this approach is holding up the value of stocks because people are blindly investing on them without knowing if the companies on the fund are healthy or not

[@michaelglass3863]

There's mention of index mutual funds, but as someone who learned the hard way that every time the fund is rebalanced and had to pay taxes... I'd recommend an index ETF if using a brokerage account. 401ks and Roth IRAs don't need to worry about this.

[@unplugged182]

1:10 ever heard of a log scale??

[@tonyvisente5286]

The real question is, how can the market grow infinitely if we live in finite world

[@mariusfacktor3597]

Technological innovation. Computer chips are made from silica sand which is one of the most abundant resources on the planet. We basically have unlimited of this stuff. We might have limited fossil fuels but we have almost unlimited solar, wind, and nuclear. I'm with you that we need to be really careful in protecting Earth's resources but that doesn't necessarily mean less economic growth.

[@mikeg9b]

@@mariusfacktor3597 Good reply.

[@briceking669]

The stock market is a reflection of inflation. It will go up as long as the dollar continues being devalued (so forever until it busts). The sad thing is you may not actually be ahead even though you look like you will because of purchasing power goes down but it's one of the better bad options. Especially when considering you have to pay capital gains on your "growth". The government will always get their cut.

[@TrulyS2345]

In short, active traders decide the price of each stock bcz passive investing only makes 5% of the daily volume.. Hence, S&P 500 does not distort the market valuations.. This is for the people who missed the point and watched video without paying attention.

[@Rej-gc5zi]

If the stock market collapses in the United States permanently, we'd have a lot more to worry about than just the stock market going down.

[@aloksrivastava7938]

Everything dies eventually.

[@2394098234509]

This is basically a facsimile of every single one of the 1 million+ "is there an ETF bubble?" articles

[@dodiloi]

The short amswear is yes. Inflation makes prices go up forever. Which drive more profits and more value fpr companies

[@YashendraShuklaTheOG]

I think some people misunderstand. Almost everyone KNOWS its a bubble. However, the stock market isn't based on valuation, its based on sentiment. Human behavior dictates they want the number to go up. So yes, while a massive financial crisis will eventually break the bubble, it will rise up again. Think about it. This isn't the 1800s where you have a gold mine in your backyard to inefficiently mine for gold. Where are people going to put their money? As long as we use made up numbers in a made up spreadsheet to trade made up parts of a company, the eventual end goal will be to make number go up. Its a shared delusion, and over time has become as integral to economics and financial security of humanity as the fiat currency not backed by anything.

[@chiefenumclaw7960]

The fiat currency is backed by jets and drones.

[@nashmonti120]

I like this comment because it points out that the American dollar being a fiat currency with manipulation from the fed is more active in creating this bubble than funds, which I think is apparent to anyone paying attention.

[@turnopsverdsen9578]

Yup. I don't care about the technical of "being in a recession" or not and neither does anyone else. I have stocks, therefore I want stocks to go up. Stocks only go down when stocks are sold. Ergo, as long as people don't panic sell (the cause of literally all stock market crashes), stocks will continue to go up. Stockholders magically generate value with this one easy trick (at the expense of non-stockholders). Weird to me how many people completely fail to realize that sentiment is literally the only thing that matters in determining how much a stock is worth. It's just an indicator of what someone will buy it from you for.

[@FullLengthInterstates]

fiat currency, absent effective monetary policy, is not backed by anything. As long as the fed is willing to stomp the economy to return to 2% inflation, fiat currency is effectively backed by the productive capacity of the currency's entire sphere of influence, as demand has to scale with supply to maintain the ratio.

[@agemanzi7792]

line goes up...

[@chasejones8302]

half the market is owned by those outside the US and all of those economies will be shrinking.

[@spencerkrispin8932]

Stocks only go up

[@francescoalberga3819]

This video is a little misguided and should have mentioned the Grossman-Stiglitz paradox: It’s an equilibrium and just because someone sells out of the index fund doesn’t mean that they cash it out completely it could mean that they move it to an active fund. Good premise of video tho

[@TheOOOOOOOOOOOOOOO]

@10:00 shouldn't it be 5 times instead of 500 times? Did you mean 500%?

[@CAG83]

This was my thought as well. Huge difference between 5x and 500x

[@mariusfacktor3597]

8:16 Investing $1 changes the market by $0.01 9:47 Investing $1 changes the market by $5.00 That's 500X

[@dr.davespinballrestoration3764]

The market goes up as the inflation of our money goes up. The dollar worth less inflates the high numbers of the stock market.

[@zerolosstraderZLT]

What if it's not impossible to see the future? What if someone no longer has to "PREDICT" the future? What if someone can simply... see it?

[@guillaumenicolas3814]

I think one of the benefit if not the main benefit is the compouding interests with dividends paid and reinvested to generate more dividends etc With index funds like said in the video the actual amount of an individual share does not matter

[@TundraKaffe1]

The index funds goin up is just the money supply growing

[@Zharath]

The efficient market hypothesis has absolutely nothing to do with why the stock market trends upwards. You can seriously question whether the stock market can go up forever or whether index funds are as safe as they are sometimes made out to be, but your video is doing neither of those things.

[@ffff3c]

Sorry but the author doesn't have a great gasp of economic concepts in this video....: - the graph goes up faster because it's compounding. If you restrict the graph to end earlier, eg 1990, it would look the same. - "stock always go up" because corporations are one major way we invest our human ingenuity and effort, and thus is the sum of a large swath of output of humanity, which mostly go up unless there are major sawn events (world wars, pandemics) - index works better than actively managed, because you also tend to diversify in a way that's less biased All the talk about efficient market hypothesis is interesting but really besides the point

[@jeffb876]

The S&P 500 IS actively managed. Nearly 180 stocks have been replaced since 2015! It's chock full of some of the most profitable companies in the world. Stock prices always have been and always will be based on supply and demand alone. Let's not complicate it! There's a limited SUPPLY of shares of each of the companies in the index, and an increasing DEMAND to own a share of these incredibly profitable companies. If you don't know what's in the box, do a little research (It's easier than ever thanks to the Internet) OR... Let the pros do the research for you at a very cheap expense ratio and BUY THE INDEX!

[@drunkenaviator4427]

If you believe that the downfall of Capitalism is nearing, then don't invest in index funds. If you believe that Capitalism will remain, then invest index funds.

[@racist_007]

If you're talking about developed economies like north america or Europe, then yes, you are right to be a bit sceptical about the index funds invested in the stock markets of those countries. But as far as developing economies are concerned, index funds are a no brainer. Atleast for the next 50 years

[@SanaatanSatyaHai]

To summarize - I'll lay my theory, nice and logical, and then drop a big, dramatic 'HAVING SAID THAT'-and immediately do a complete 180. Thanks that helps !

[@josephlance9262]

Didn’t even answer the question that is the title of this video? Or even really address it? Just talked about index funds

[@His.Lordship]

The whole s&p and really any index makes no sense and is a bubble or the product of unjust unearned wealth concentration as long as its price rises faster than overall economic growth.

[@ttopero]

One thing that’s a mystery & rarely discussed is the weighted setup of index funds & ETFs. Is the value held of each company the same, based on the % of total cap rate of all companies, etc. Would like that education

[@tehpanda64]

When you ask: "can the stock market can go up forever?" You are either asking if there can be more people seeking to invest than there are people looking to divest forever. or alternatively: can money inflate perpetually. To both of which I say: maybe?

[@denzel1832]

YES (I am invested in the stockmarket please buy more so mine go up)

[@Jrav27]

Brownian motion (i.e., what underpins the efficient market hypothesis) is not an adequate representation of the risk in the market.

[@Deadeye313]

The stock market will go up for the foreseeable future. Why? We have no other choice. With non-governmental pensions virtually exstinct, everyone is forced to buy stocks to retire, and since not everyone has time or expertise to properly research individual stocks, then index investing will be the way to go for the foreseeable future.

[@powdork]

Doesn't the massive rise in the market also align with when share buyback programs started?

[@idkmax5977]

I had same question Thank you so much for such a wonderful video , it one of the most favorite videos of mine about investments

[@wherami]

This is what they have told people for decades lol it only goes up. Till it’s all gone

[@cloudyeight]

Wow. I'm trying not to be negative but that was a waste of time. You completely missed the opportunity to talk about how you valuate companies.

[@amsalmeron]

Great video! However, I think it's crucial to remind people that the S&P 500 is not the world, but rather a collection of the largest profitable US-listed companies. Once you take into account an ETF like VT, much of these so-called issues (namely, overvalued stocks) become irrelevant. Furthermore, index funds allow you to target the cheapest stocks in the local and global market, which have historically and consistently produced superior returns to the most expensive stocks. Finally, the market does not continue to go up based on trust or fate, but rather because we expect companies (whichever they are) to continue to produce profits over time. Hence, people are willing to pay a higher price for them now to access these profits well into the future and so on.

[@stevenlarson3316]

I think this is just a case of there not being any other good options to store value. US Index funds have a proven track record and they are extremely liquid. There's not many assets like that. The risk mostly comes from some kind of structural down turn in the markets like the housing crisis in 2008. Without that kind of fundamental catalyst I see no reason why index fund investors would de-risk. Even if the markets start curving straight up they will still probably find support on the way back down. If you are in the chaos at the top it will still feel like a crash, but for everyone else bought in low, it will just be a wild ride.

[@mujtaba21]

I've been thinking of this for a while and we don't have an answer to the question yet. However, as I've been watching this video, I remembered what a crazy guy called Michael Saylor says; He claims that there is a system that we could always funnel money into and not be worried about it. It would always take our money and can grow forever because it doesn't have to generate equivalent cash flow. It can exist for retirement, investment, hedging, maintaining value, growth, hope ... Ahhh, if that guy's idea just came true and we had that system

[@3abxo390]

So... Did he answer the question? Can it go up forever? Why or why not? What's the takeaway from this video? Does it have any substance? Any message?

[@peterrange4625]

You have some good points, and folks should be worried about the degree to which people are piling into index funds. Returns should be a reward for taking on risk. Also a bias to American markets is a big problem, remember past returns are not predictive of future performance. Just because the American market has been the top performer for the past 100 years does not mean it will continue to be. In fact I think that’s unlikely. At the same time you neglected to take into account log returns (look at how all these charts hockey stick upwards) and inflation.

[@shaunrosenberg4568]

Since the video didn't answer it, a solution is to diversify. With everything going into the S&P 500 put a little bit of money into a funds that track small caps and international stocks as well. Those aren't as overvalued.

[@BetaProductionz]

The US stock market is overvalued for the same reason that every other US asset is overvalued- The US dollars reserve currency status. The global demand for dollars allows the government to print more money at lower interest rates and any other country. Those dollars, in the hands of the rest of the world, get spent buying up dollar denominated assets like American real estate, farmland and equities. So long as we maintain our world reserve currency status, line will continue going up on everything in the US. Once we stop though, oh boy.

[@marcialabrahantes3369]

A raising tide lifts all boats. Extra liquidity just goes into Crypto

[@Charlie-gf4mv]

The reason given for WHY invest in index funds is completely wrong, it has little to do with the efficient market hypothesis. It is about diversification, and as many say, diversification is the only free lunch in finance.

[@IakonaWayne]

Complex systems in a game theoretic always adapt , im always weary of just put it in the s & p 500 or just buy a house . Both of these markets are not efficient especially the housing market . And increasing over the last 10 years the same for the stock market.

[@vipermoon_]

I think it's going to depend on US Dollar and United States global dominance. If that continues, okay. If not, yes this is/will be a bubble.

[@donovan4444]

There's another huge risk you may have overlooked. As the largest generation still, baby boomers are going to start needing to use their disproportionately large index fund money to pay for retirement costs. As they withdraw their money, the new money might not be enough to replace it and we could enter a downward spiral fueled by "get out last and you lose most"

[@sturmeko]

Life is like Monopoly game, either you keep buying companies and win or keep buying products of companies (stepping on owned squares) and lose.

[@MIKAEL212345]

I really wish this video was more in depth on the consequences of more people in index funds. A theory I've read says that as more people invest in index funds, actively managed funds becomes more profitable so the problem is self correcting.

[@caigenproject]

The good thing is that the market doesn't care about what's true. only about what "most people think" (or better, what the most dollars think). so as long as de majority isn't sceptical, it doesn't matter what the actual dynamics are.

[@mikeg9b]

I invest in index funds. I realize that, for index funds to work, there has to be some active investors influencing stock prices. The few investors who are smart enough to do that well will beat the market and are justifiably rewarded. I'm not one of them.

[@Rizhiy13]

Just plot earnings vs price and it will explain everything. P/E ratio is a bit higher than average currently, but so is expected growth.

[@whyyoureadingmynamesir]

When every youtube video wants to be a "vox" video... all vox-clones now... Can you actually try to be clear and concise instead of making a "cool" yt vid

[@RWROW]

Would have been useful to talk about fundamental valuation of stocks and how far passive investing has driven stock prices above levels that fundamental valuation would suggest are sensible. What will tip stock prices down till they are closer to fundamental values and when? No one knows.

[@Corner5tone]

Excellent video production, I'm very impressed by that! That said, your description of the reasoning behind the efficient market hypothesis is somewhat off - Ben Felix of the Rational Reminder podcast has some excellent explainer videos of what is precisely contained in the efficient markets hypothesis.

[@faijro9260]

What is the reason for this extra money coming into the stock market? Is it because people who can't afford a home now invest in the stock market instead, or is it just improved financial literacy?

[@ZadieBear]

How about: Investing, no matter the vehicle, is always a risk. Pay attention and don't get caught holding the bag.

[@RiccardoGabarriniKazeatari]

The theory is based on the idea these passive investments are uninformed investments, but since they buy basically the stock market as a whole, they are investments on the economy of the country. And ppl do know that in the long run the country will be fine

[@Feds_the_Freds]

TINA, actively investing is just worse, and stocks have the best riskprofile (well, especially for young people)