Stock Market & Real Estate [2019 & 2020]: MASSIVE BUBBLE then RECESSION (Negative Yields)

Stock market prediction. Real estate 2020. Negative yields what it means for you
David Jaffee with and in this video we are going to
discuss the financial implications of negative yields there is a very bad
situation going on right now in Europe where their economy is struggling the
governments of the European Union are doing everything possible to stimulate
the economy negative yields which means that for when you put money in the bank
account usually that bank will pay you interest instead the bank is actually
taking money from you that means that instead of depositing money into the
bank and receiving a little bit of interest instead when you put money into
the bank and you leave it there it’s actually losing money what is going to
happen in this situation is that there is going to be a flight towards yield
which means that situations well there’s actually two competing factors the first
is that people are going to that the yields in the United States are going to
continue to contract so right now I think the 10-year yield is around 1.8%
but there’s going to be a flight towards yield and a flight towards quality
assets that means that risky assets like real estate the stock market gold silver
crypto currencies are going to have a large influx of money being poured into
it because people are going to check or they’re going to chase returns on the
negative side negative yields means that the inflation rate is going to decrease
so in a way this is going to be this is going to be negative for real estate
because real estate is oftentimes I would say that a significant part of the
gains associated with real estate are due to inflation so when you have
negative yields it is going to decrease the inflation rate and oftentimes lead
to deflation and as a result the gains in real estate and other assets of that
nature are going to
more or less offset so I believe that when you have an economy where there are
negative deals and it’s extremely rare I can’t remember another situation where
there were ever even close to negative yields but the governments in the
European Union are doing everything possible because the economy over there
is extremely bad you have company you have countries like Portugal Ireland
Greece and Spain which are very close to going bankrupt I think there’s another
one that starts with it with an eye so Portugal Ireland there’s one more you
know Greece Spain etc but with negative yields essentially very risky assets
like stocks crypto currencies gold silver and on the lesser extent real
estate are going to do exceptionally well there is also going to be deflation
and that is going to hurt real estate so the gains from the negative yields and
from the yield shit and from money chasing yield is going to be offset in
the real estate market by the deflationary aspect of having very in
the United States having very low yields and having negative yields in the
European Union this is oftentimes going to lead to a bubble and I would expect
that probably in late 2000 I would say probably around mid 2021 because
generally speaking during the elections they’re not going to have recessions
because the incumbent president wants to make sure that he is reelected so he’s
going to do everything possible to make sure that the economy is extremely
strong that way when he’s running in order to in order to make sure that he
maximizes the amount of votes that he receives he is going to do everything
possible to pluck up the economy when we saw this this past week where he he
lobbied the Fed for a 50 basis point reduction the Fed then told him that
they would give him 25 basis points and they told the market 25 basis points and
then the following day Trump tweeted out something about Chinese tariffs in order
to give himself more ammunition now this is not a political discussion I don’t
know anything about politics if you guys knew the amount of media that I consume
you will be incredibly shocked I do read any articles I have never voted in
my life and I will never vote because I just don’t so if you want to criticize
me no problem but I do not know anything about politics this is not political all
I care about is educating you about what the best decision is for you in order to
maximize the amount of money that you have so my goal is to teach you skills
and knowledge that you can actually learn to make money so I’m just telling
you that in my opinion I believe that there will be a large recession in 2021
I do not believe that it’s going to happen next year because the election
but I do believe that there’s going to be a massive recession in 2021 and that
the and that a bubble is going to ensue and the stock market is going to do
extremely well in this negative yield environment because there’s going to be
a lot of money chasing returns and you’re gonna have things such as gold
silver the stock market crypto currencies and to a much lesser extent
real estate outperform real estate would outperform except for the fact that real
estate is going to be held back by the deflationary environment which we’re
going to offset a lot of the a lot of the returns from the yield chasing you
know from those who are chasing riskier assets with with the negative yields
that you’re essentially going to be penalised for putting your money in the
bank account let me make sure that I got everything negative eels your bank
account is going to lose you money the European economy sucks they’re trying to
stimulate this is going to lead to massive bubbles and an inflationary
economy and inflationary event in risky assets but overall it’s going to be
deflationary for things like food and groceries and even things like real
estate things that are gonna do extremely well are gonna be stocks gold
silver crypto currencies you know I’m definitely not a fan of crypto
currencies I think that it’s a scam on a lesser extent Real Estate’s going to do
gonna do well I think that there’s going to be a massive pop of the bubble and
there’s going to be a recession in 2021 and that’s about it
I’m not necessarily a Bond guy I mean I worked as an investment banker and we
almost always focused on equity’s we did M&A transactions equity
capital markets with follow inequity opera offerings and IPOs we did do a few
debt deals but in that respect we then yielded or rather we then brought in the
debt capital markets for the banks that I worked out I worked in Morgan Stanley
I also worked at CIBC World Markets and then I worked out Tatsuki Brunei which
is a much smaller boutique firm and they were when I worked with them they were
located at 40 Wall Street so I’m not as comfortable discussing the debt side of
the market as I am the equity side but at the same time I mean it’s pretty
obvious when you put money in your bank account and they take money from you you
are going to be much more hesitant to invest your money in the bank account
because for every dollar that you put in when you then go to take it out you are
going to be taking out less money as a result because people tend to invest
money in assets that treat them well you are going to invest more of your money
and you are going to chase returns in high-risk returning assets like stocks
and gold and silver and cryptocurrency and potentially real estate and that’s
about it you can go to and enter in your email
address to receive over $400 worth of free training please let me know your
thoughts about this negative yield economy that we are in and this negative
yield environment that we’re in let me know if you plan on investing more money
into the stock market what let me know whether you believe that we are going to
head into a recession in 2021 and I appreciate your attention

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23 Responses

  1. António Meneses says:


  2. Brian Thompson says:

    Time for recession proof stock.. after taking your class my watchlist is alittle different. DG, Mcd, JNJ, HD. Along with the bread a butter stocks like LMT, RTN. Any other recession resistant stock to keep an eye on?

  3. BestStockStrategy says:

    Do you think we'll see a bubble then a recession?

  4. Ion Grigoras says:

    I don’t think that negative rates are possible in America, a lot of banks will go bankrupt.
    As far as bonds, wouldn’t put my socks in them, ever. Back in the 80’ was a different story.
    If 2021 brings us a recession, we know what to do, sell calls for the duration of the correction/recession.
    And real estate will come to a halt and pull back a bit, man I don’t miss the days when I was land-lording !!
    Happy Thursday.

  5. Ellie Crawford says:

    I also think that we'll see the bull market continue and then a stock market recession. but only until after the election.

  6. Hannah Fry says:

    Why do you think real estate will do well in an deflationary environment?

  7. Jasmine Bennett says:

    What about bank stocks? Will they do well in the stock market?

  8. Naomi Howard says:

    What about buying real estate and renting apartments?

  9. Mary Bryant says:

    Do you recommend buying stock market apartment REITs?

  10. Zara Duncan says:

    Excellent video, how does this change your stock options trading strategy?

  11. Lara Lane says:

    Your videos are very authentic. I wouldn't be surprised if you become one of the more popular stock market channels on YouTube.

  12. Jamie Scherer says:

    Why is the interest rate in my bank account so high if they are not paying interest at all in Europe?

  13. Chewie 13 says:

    I don’t buy calls, but if one bought an aug 16th 143 Call on TLT last week for .05 the returns would have been unreal. (Selling it over 1.5). Low probability but interesting phenomenon.

  14. W S says:

    Good video. 100% agree that a recession will not happen until after the election.

  15. Chewie 13 says:

    By the way, staying away from politics and/or twitter is so smart. I wasted two days with twitter crap ending with my conclusion that-big waste of time. So oversell love your videos with so much precise information. Thanks again David.

  16. Shaun Afandiyev says:

    Youre really smart, more importantly a good teacher.

  17. adivin3 says:

    Recession only if Trump doesn’t get re-elected.

  18. Collis Williams says:

    Why do you think cryptocurrency is a scam? I value your opinion, but I also own crypto because even though I haven't trusted it, I couldn't help noticing that it was making people money.

  19. Jon Ward says:

    I strongly believe that if it were not for the Plunge Protection Team manipulating the markets back in the latter part of 2018, we would already be in the beginning part of a recession here in the United States. If natural forces were to prevail, I would agree with you 100%. In a worse case scenario, the US Government will implement another stimulus package to prop up the markets again. With that said, I don’t have any money in the stock market. I’m waiting for another correction/crash before I buy any stocks. I will continue to sell options, though. We will make a mint whenever the correction happens! I also agree with your assessment on gold and silver…

  20. Richard Rodriguez says:

    Its called the PIIGS portugal, Ireland, italy greece, spain

  21. John Lin says:

    I'm kind of surprised by this video because in the past, I recall (maybe incorrectly? maybe my memory is off) you discussed why you should listen to people about predicting the economy or stocks, etc but you made a video doing such. (or maybe that's what I got out of Fooled by Randomness by that a-hole Nassim Nicholas Taleb)

    You didn't mention the inverted yield curve – which I didn't know an old Duke MBA professor of mine had "discovered" was a pretty good predictor of a recession:

    Then again, you had mentioned you didn't really consume the news much.

    Japan has practiced negative interest rates in the 1990s, and I think in the 2000s and also more recently to encourage consumer spending.

    Personally, it'll be interesting to see when we have a slow down / recession. We're now in the longest expansion of the U.S. economy in the modern era. I do think the trade war with China will help slow down the economy. China's devaluation of the RMB definitely caused a scare earlier this week. Additionally, I think China is waiting Trump out and could dump a lot of U.S. treasures in September 2020 to ensure Trump's defeat.

    You should vote. At the very least, in local elections that are close to you that affect you pretty directly. People immigrant from other nations from dictatorships and do like to exercise their right to vote.

  22. joesemo says:

    OK. If you are positive that Recession and a Grey/Black Swan scenario is on the way. Then why not take 5%-10% of your portfolio and buy some SPY/SPX Puts like One Year+ out. called LEAPS. Ladder the strikes 1 at a time downward starting at 260, 259, 258,257 etc. and then sell weekly way,way out of the money calls to make income while your waiting for the end of the world. POOR MAN COVERED CALLS. Then when the shizzle hits the fizzle you have a ton of cheap Puts sitting In The Money.

  23. Edward C says:

    Why do you say negative rates cause deflation?

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