So, based on what just happened over the past few weeks, should you just completely liquidate all your growth and get all in on value? Should you rotate your portfolio immediately to avoid further losses? Well, let me answer that with a simple story: let's say that you want a tracksuit, let's say in the d-distraction or a sweater: let's just use this sweater, i think it's simpler and that sweater is a hundred dollars and you drive to the store and somehow by The time you get to the store that sweater is now on sale and now you can buy it for fifty dollars. Would you not have second thoughts about it and you say: well, i'm not really sure i want that sweater at 50, just because the price drop. I mean you're gon na pay, 50 bucks get out of there and say thank you, lord jesus. I can got the sweater for 50 bucks less than what i intended to pay.

Thank you or let me give another example. Let's say that you buy this weather for 100, there's no discounts, you buy the sweater 100, you get home, you go to sleep. Wake up the next morning you find out the entire store has gone on sale and that sweater you just paid 100 for - is now selling for 50. Now would you immediately go on ebay and try to sell your sweater for 50 because you don't want to hold on to that sweater, because now it's 50? Oh, my god, i have to panic, sell my sweater right now, because it's just 50 bucks poor, we'll just wear it, enjoy and say well that sucks, but i mean i guess it is what it is, but i'm still going to enjoy my sweater.

It's still the same amount of sweater, it's the same story with stocks with stocks. What you get is, you know: incremental ownership in companies and businesses in tangible and intangible property, and the fact is that the willingness of certain people to pay a certain price for a partial ownership of that in any single day or week or month doesn't really take Away from the business, it means most likely nothing for the business, so i think you have to have that mindset before you make a decision on whether you want to buy, sell or hold a certain stock or a certain category of stocks like growth. Now what just happened with the fed is very interesting. When the fed came out, as i predicted and announced hey, the interest rates will be raised higher than what we initially told you, everybody panicked, so the entire market, even bitcoin, even like cryptocurrency value stock, everybody just sold off everything.

It was a stampede out of everything. Everybody's going cash heavy and the question is in this situation with everything bottoming out. Is this now a good time to sell and rotate? Well, i'm going to answer you with a simple calculation. Now, whenever you have this massive panic sell-off like we had over the past two weeks, you have to slow the f down.

Basically, you have to play it like a professional athlete. If you go to a game as a baseball player or as a basketball player or in the mma business whatever and you're, just completely berserked and like oh and you know, you're gon na jose aldo yourself out of a match, pretty much shout out to them and Make community, but basically you have to slow things down otherwise you're gon na panic, your way into a really bad situation and if you're talking about businesses. Let's understand what happened over the past few weeks that the value of any of these businesses you're holding on to has changed now. Obviously, we all know the federal reserve basically put out their minutes and in the minutes they indicated they're going to raise interest rates.

Much higher than originally expected, of course, they didn't specifically say a number, but that alone was enough for everybody to panic, sell the entire market. Now the question is at this point is not whether you should sell, because it's quite simple to see that this is a panic, sale and there's going to be a correction back. The question is: should you buy more now at this point if you're interested in growth? Basically, tech companies with a lot of upside, should you buy now, because everything just panic sold like crazy? Well, not necessarily because we might be in a very crazy situation where we're sitting around around september october and we might be tempted to pull the trigger too soon and miss out on the christmas sales, because, right now we can get probably a sale. You know right before black friday, whatever, but if we have patients, we know that in december the christmas sales are going to come on and it's going to be way more lucrative to buy the same amount of businesses.

So while it's clear that we see that this whole thing was a panic sale - and this is at least for me - not a good time to liquidate any positions, because everything got oversold like crazy - it's also not the best time to get in on stocks. I'm actually excited about, except for a few that i am always buying like a tesla or pallenti, regardless of the market situation. So how do we know when this christmas sale is coming? That's a really important question. Let me show you so how do you figure out this moment? When is this christmas cell coming? Well, you have to be a detective and a good one.

You have to come and look at the crime scene and basically examine everything. Look at what the witnesses are saying: who's credible who's, not who has motives to lie. Who doesn't what is the circumstance telling you everything has to be examined for you to make the best estimate of what the hell is going on on this crime scene? Of course, you might be wrong. I might be wrong.

I've been wrong multiple times before, but this is a method that most often did not actually works. So basically look at it this way. The first thing we have as an indicator is the federal reserve, basically saying well we're going to have minimal interest rate hikes, and then they came back and they fixed their version. Well, it's not going to be as minimal so right there and then we know there's a credibility issue with this.

Witness this witness suspect has now changed their story within just a couple of months and in our time let's say a couple of minutes, so we came to the scene. They told us something else about the interest rates now, they're changing the story a little bit. I'm already a little bit suspicious of the fed. Now the second thing is well, who has incentive, slash, motive to lie, and in this scenario, of course, you understand who has the motive to not be truthful about what they're about to do? The threat is trying not to spook the market.

The politicians want you to just chill and try to keep it quiet as possible. So we know they do have an incentive, slash motive, not to let you know how bad it's going to be and, of course you have to look at the evidence in the room. Now the evidence in the room is the cpi numbers and what the mathematics are saying about it. Now the cpi numbers are about 6.8, as of november, probably about 7.

At this point already - and we do have mathematical evidence of how much interest rates we should see at a seven percent inflation. So of course, me tom. The hypothetical detective are looking at the scene and saying well, this doesn't add up what i'm seeing on the floor. Doesn't end up with what the fed is telling me what's going on plus the fed has a credibility issue, so i'm thinking there should be something more here, they're, not telling me everything they know now.

The real question here, of course, is what does the market think? Of course, we can clearly deduct that the fed is definitely not telling us everything they need to tell us about what the interest rates eventually will be they're currently guiding to about one percent point: nine percent by the end of 2022 - that's not gon na be enough. Obviously i made a whole video explaining why look at the tail rule. It is basically an explanation of how you should calculate interest rates in inflation times to stop inflation. Just in a short summary, if you want kind of a rule of thumb, quick calculation, it's about 1.5 x - but of course it's a very complicated formula, but it's definitely not point nine percent when you have a seven percent inflation now.

The question is: is this already priced into the market? I don't think so because, just looking this morning, goldman sachs just came out with a paper saying well, there's gon na be four interest rate hikes just in 2022, but when you read the report they're, basically guiding to under one percent by the end of 2022. So it's basically the market consensus. So when i look at all these evidence, i'm basically saying well, the fed is not being honest. The market is not pricing it in because they'll have to raise interest beyond one percent this year, so that creates an opportunity for a massive pullback which would allow that christmas moment for you to buy growth at a cheaper price.

Now, for that to happen, you do need to understand that there's a lot of assumptions that you have to make here, don't just end the video here. We have a really important part coming up check this out, because knowing the timing is not going to be enough, you still have to a make the right decision. If you buy a shitty company, it's not going to help you the fact that it's discounted, a company, that's trash, is still trash, whether it's discounted or not discounted. It's like a bad sweater.

Don't want to buy it now. The second thing is, you want to be able to understand when the supply chain issues will be sold, because the supply chain issues in this case is basically a lighter fluid being poured onto this fire. Until you stop this pouring of lighter fluid, you can't put out the fire. So the question is: when the supply chain issues will be eased and in our case you have to assume it has to happen in the second half of 2022 and change.

Number three has to be an increasing competition in the market. If we keep consolidating, if we keep creating this non-competitive markets in the us, there's gon na be very tough time to get these guys to lower their prices, because that's essentially what we need to happen now. The only way to do it is to break apart. All these monopolies and completely go and create this competitive environment where competition is going to help deflation by creating more price pressure downwards.

Now that, of course, in itself it's not an easy thing to do and, as you should know, the anti-trust authority in the us has not been the best at doing that, but they have to start thinking of ways to completely create this competitive environment, because that's the Only thing that can contribute to this price pushing downwards. Now. You also have to assume that the us has to create gdp growth in the second half of 2022 and a significant one, because if they raise interest rates their own debt, the u.s government has that it has to service. The debt becomes way more expensive and unless the gdp goes up and as a result, the tax income goes up, they can't pay for that and they'll have to just print more money to pay, for you know servicing that that essentially increasing inflationary pressures, if you print More money, basically, this means jack.

Now you do also have to understand that, for this whole thing to work, you also have to assume that by the second half of 2022, the pandemic is going to become an endemic and will all learn to live with it. Instead of battling and basically going into lockdowns and all this thing, so you do have to understand that the assumptions here are not easy, but probable, because if you don't assume these five factors, essentially you're betting against the us economy. Now, beyond the fact that means you're a douchebag, it's also a foolish bet. I mean this is still the strongest and the best economy in the world and betting against it.

That's not a very good bet. So, if you do that, good luck to you, i'm not! I'm going to bet that this thing actually works out, but i'm gon na wait for the price to go down to a level when i can get it for the christmas sale, not jump the gun right now now. I hope this was helpful. Let me know below, if you want to support the channel five bucks a month, the link is below join the patreon join us.

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