Okay folks, so two people will look at a chart like this that shows the S P 500 returns over the last 80 years and one will say wow, It looks like every single dip, no matter what the reason was, was a huge buying opportunity. Even if you bought in at the tops, you still made money and another person would look at the same exact chart and say 80 years of an overall bull trend. Talk about overextended. Get ready for that great reset.

We've got a super bubble on our hands. Better cash out now and stay on the sidelines. at least then you won't get your rear end handed to you. Haven't you ever heard of? Don't Chase.

This market's been overvalued for at least 75 of the last 80 years. But the truth is, while both people are very, very prevalent in every single market condition in the long run, being a bear is very, very tough business. In fact, it's very close to bankruptcy type of business. Why? Well, because markets overall go up over time and that's because remember, markets track companies.

It's easy to forget when we're tied up and looking at what the Fed is going to do and we're tied up in Russia and tied up in a million other things. That the inherent value of companies is based on the inherent value they provide to customers and what they're able to get in return for that. Healthy companies over time make more money, they get more productive, they innovate and add new services and products. And if they don't what happens, well they get tossed aside like a dog on the street and new competitors come in and snatch all their customers.

That pushes the overall market to consistently search for a competitive edge and consistently try to add more and more value for customers, which accelerates the actual value behind the companies. And it's why it's so difficult to be a bear over the long run, unless you genuinely believe that we are at peak innovation as a human race. If you think about the long-term growth of the stock market, what does that really mean? it means that despite bearish calls being the most heavily clicked and closely watched in almost any market condition, well, historically, they have almost always aged to be useless. if you had to choose between being a blind permabul and a blind perma bear.

Well, historically, up to this point, you would have statistically been much, much, much, much better off just being a permabull. And that doesn't mean that you can't be pessimistic from time to time about short to medium term conditions. I'm fairly pessimistic about the current situation that we're in right now, and I've explained why, but I am incredibly and jaw-droppingly optimistic about the overall context, the overall long-term growth trajectory, pessimistic about the current day, but very, very optimistic about the long run. And the reason that's so important for me to mention is because you cannot let your short to medium term pessimism derail your long-term optimism.

My level of conviction in the overall growth of the stock market over the upcoming five to ten years is more than my conviction in the short to medium term pessimism, and is historically a lot more relevant than my short to medium term pessimism. A telltale sign of derailing your optimism with your short to medium term pessimism is for example, making extremely rash decisions for long-term high conviction plays during a period of time where you've now gotten a little bit more bearish. for example, selling everything and rotating into a completely different sector that you don't even like over the long run and there's just hot in the moment or selling out of your entire portfolio despite the fact that you yourself told yourself that you wouldn't or any sort of decision that is not long term in nature. Over the course of the last two months, especially, you've seen a lot of people completely rotate their entire long term objective over short to medium term problems.

And in a world where market pessimists tend to get a lot more attention than market optimists, this is a huge stinking problem. Short-term pessimism can help you gauge some of the best opportunities to add more on dips, But long run chronic pessimism is a disease. And it's a disease that's very similar to laziness. Your brain often uses that as a subconscious excuse to stop you from taking any sort of action.

Think about it. If you're an optimist, that's pretty damn hard work, isn't it? You have to go and research companies. You have to value them. You have to wait to make sure to buy it at a price that makes sense.

You have to follow up and make sure that it deserves your conviction. and you have to risk your hard earned capital. But being a pessimist, it's really, really easy. All you have to do is stay all cash and smirk at the idiots that are in the market that are seen volatility.

Forget about the market. Who cares. It's all a bubble. Anyways, at any price, sitting on the sidelines is really, really easy.

There's no personal risk, there's no effort, there's no chance of loss, at least not from equity dropping. and whatever happens over time, you feel good about yourself because you're like, well, if it went up. Yeah, that's what happens in a bubble. It goes up until it pops, And if it went down, you're like, yeah, that's good because I knew that it was overvalued.

Being a chronic pessimist is sort of like sitting in a classroom and making fun of that one kid that goes and raises his hands and puts in a lot of effort to answer each and every single question. lol. What a loser for putting in the effort. I'd rather just sit here and do nothing.

He could be wrong, People could laugh at him. and the reason that I bring this up is because you had a lot of chronic pessimism after oh, 1809 and it pretty much lasted all the way to 2019 2020. Then after the 20 drop, you got that pessimism over Kovid. and then all of a sudden the Fed pumped everything up too high And companies are all garbage because there's a lot of tech companies and software companies that have factored in too much blah blah blah blah.

And then you got a cyclical downturn and you got some more pain towards the beginning of this year. But now you're starting to see in the retail community a lot of that chronic pessimism coming back. This idea that I never want to put myself out there and risk anything. This idea that I'm going to sell out of all my long-term positions and just wait it out.

This idea that I'm going to magically know the time to buy back in this idea that we need to sell as fast as possible because it's only going to get worse. I just don't see how good can come from the future. This idea that this time is different, but in my view, I think this is a completely wrong way to use pessimism. The amount of pessimism in the market is a gauge to you not to decide to quit the market or question the purpose of even being in the market, but rather to gauge how hard you buy the market, how fast, and how quick you scale in aging, how hard you can buy dips before the pessimism inevitably leaves and optimism comes back.

So anyways, in the last part of this video, I want to walk you through some of the big reasons why you should be very, very optimistic over the long run here: Reasons that despite short-term macro setbacks, you need to be incredibly incredibly optimistic about the overall future. Number one is that I believe that we are on the verge of dramatic acceleration and productivity growth that we've never seen before, which are going to drive insane sales capacity and future earnings capacity. And that's largely thanks to the tech sector and how the tech sector is going to influence all of the other sectors of the economy. The biggest companies Microsoft, Apple, Google, Alphabet, Facebook, Amazon, Netflix appeared out of basically thin air in the last few decades and have driven a dramatic amount of stock market returns.

The impact of tech that they created and tech outside of them also drove a huge amount of stock market returns throughout the entire stock market, But tech is still only about 10 of the Us Gdp. However, subsections of tech are growing faster and faster than the overall economy of the Us. A study from Iab found that the Internet economy grew seven times faster than the total U.s economy. But in terms of rapidly accelerating new economic growth and industries that are going to come out of thin air, look no further than A.i Gartner Research estimates that even in the next year, Ai software market revenue is going to jump about 21.3 percent, broken down in sectors: knowledge management at 31.5 growth, Virtual Assistance at 14.7 Autonomous vehicles 20.1 Digital Workplace at 20, crowdsourced data at 19.8 and all others 21.4 for an average of 21.3 percent.

This is an industry that is in its infancy right now and is dramatically scaling up fast. Similar to a lot of the other technological advances that we've had in the last two decades, is going to have a huge impact on literally everything. Even in the short run, 48 of Cios in a recent executive survey said that they have already deployed or planned to deploy Ai and machine learning technologies within the next 12 months. If you look at the estimated market size shift from 2019 to 2030, I mean, it's nothing short of mind-blowing.

You're going from nine billion dollars to 253 billion in 2030, and that's still likely to be again in its infancy. You're creating an entire new market out of basically nothing, and Ai will make every business substantially more efficient. There are countless other examples of different technologies that are emerging just like this and are going to have just as big, if not a bigger impact. And don't forget that software companies will be able to sell this Ai software throughout the world, bringing in insane revenue and a lot of the best Ai companies are going to be based, most likely in the Us.

We'll see if U.s tax policy screws them over enough to get them to move, but so far it seems like it makes the most sense for them to be in the Us and they are here now. According to research, this is likely going to be one of America's fastest growing and biggest industries, and much of those gains are yet to be factored into the market. Arc and Vests Say what you want about them and say how the fed is tightened. They're fun to oblivion, but they make a really good and obvious point in a broader context vision of where we're going.

They pinpoint certain areas of time where innovation drove a huge amount of growth. The invention of the steam engine, railways, internal combustion engine, and then the telephone, personal automobile, and electricity. Things that dramatically increase the ability of the economy to grow drove economic growth in a way that otherwise would have been impossible. Then the scale of innovation dropped off from big inventions until personal computers came out, and then of course the internet became widespread.

Now they are arguing that we are going through transformation in five different new categories and we're going through them right now: energy storage, Ai, robotics, genome sequencing, and blockchain technology. And they argue that much like the invention of electricity, a new major invention can give about 30 years of insane growth until you get that invention penetrating most sectors. That's the same thing that happened with the computer and the internet. Insane growth as companies and sectors scaled into that.

And that's the same thing that's going to happen as you get new technological advances. As you get new technologies that we've never even factored into any sort of analysis versions of computer technology, energy storage, ai that we've never even comprehended, you look at energy storage precedence Research argues that the energy storage market will go from a 25 billion dollar market to a 224 billion dollar market. In a similar way, the robotics industry is expected to grow at a compounding annual growth rate of about 15 to 20 percent through 2030.. innovations in any of these categories are going to help Innovations in every category.

And what about some of the more foofy and hard to analyze industries, or at least forecast industries that are coming in the upcoming decade like the Metaverse. It seems obvious that as we go into the future, we're going to be more and more immersed into the digital world. And as we get immersed into that, there's going to be a lot more monetization and economic growth that can be hacked, even if you just look at the last 20 years, we've had some insane scaling up of technology in all businesses, and we've had some insane productivity gains almost everywhere. Looking at the past and then looking at the future, you have to ask yourself, are companies going to continue to figure out how to earn more money? Are they going to continue to come up with new and better products to sell to customers? Are they going to figure out how to provide more value to them? If the answer is yes, then you're a long-term bull.

Lastly, and this one is a bit more Us-based I do think that there's going to be a lot of opportunities in emerging markets, but you have to recognize the dominance of the U.s market. The U.s is quite simply a capital superpower, and capital Superpowers tend to grab the biggest market shares of new capital. It's tough to fail when you run the show. 55.9 of the total world equity market is Us-based That means for every one global dollar invested, about 56 cents of that is in U.s exchanges.

That's despite the Us only accounting for 24 of world Gdp. You look at the runner-ups in terms of markets. Japan is at 7.4 percent, China at 5.4 and the Uk at 4.1 It doesn't even come close. Remember China's number three here at only 5.4 But China's share of world Gdp is 15.12 which isn't super far behind the Us yet.

Investors have chosen to put 10x the equity value in the Us than they have in China, and you know why that is. It's simple, global capital needs a home, and global capital is attracted to environments that are easy to invest in. Have economies with long and successful histories, have good infrastructure, are relatively business friendly, and as seen as at least relatively trustworthy and transparent. And quite simply, when you're combining all those factors, nothing comes close to the Us, which is why so much capital likes to invest in the Us, and why so many foreign companies list on U.s exchanges? Because the confidence in the framework of investing within the Us is much more than the confidence of investing in the framework of, say, China.

We can moan and groan about the Us U.s politics, even the Sec, and how they manage to regulate markets. But but the fact of the matter is in comparison to everything else. Investors still think this is by far the best market to invest in. Heavily financed countries tend to innovate a lot faster than the rest and tend to have superior financial returns.

I have no doubt there's going to be some emerging markets that far outpace the United States in terms of Gdp growth, but how many of them are going to have stock markets that have the degree of trust that the Us Stock market has and are going to be able to consistently beat something like, say, the S P 500.? So anyways, folks, I would say that regardless of what we're going through right now, the back and forth, the ebbs and flows. Truth is that we have a lot to look forward to. There's going to be an insane amount of growth and we're all going to have a very, very good time. We just want to make sure that we're setting ourselves up properly to enjoy it, making sure not to make rash decisions, making sure to learn if we do make rash decisions so that we can set ourselves up to win the next time.

and we don't make those bad decisions again. And overall, looking at the broader context. Anyways, folks that caps off the video. If you have any questions, feel free to reach out to us below or join us on zip creator circle.

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