 Good day, film investors. I have found an amazing video by Peter Lynch that explains everything you need to know about investing, so enjoy it. Are you concerned about the volatility in the financial markets today? Do you think something needs to be done to reduce it? I love volatility. I remember when in 1972 the market went down dramatically and Taco Bell went from 14 to 1. They had no debt, they never had a restaurant close, and I started buying at 7, but I kept on to it and it went to 1, and it was the largest position in Magellan in 1978 when it was bought out by $42 by Pepsi-Cola, and I think it would have gone to 400 if they didn't buy it out. I think volatility is terrific. I think it is very, I think these calls are very important. I don't think the market going up 80 points one day and down 80 the next is a good thing for the public. I think that's not a very good thing, but I think all these callers and all these other things to keep the volatility down each day is important, but the market is going to go up and down. Well, human nature hasn't changed a lot in 25,000 years, and some of them will come out of left field and the market will go down or the market will go up, so volatility will occur, the markets will continue to have these ups and downs. I think that's a great opportunity if people can understand what they own, if they don't understand what they own they can own mutual funds, try to figure out mutual funds they own and keep adding to it. Basically, corporate profits have grown about 8% a year historically, so corporate profits double about every nine years. The stock market ought to double about every nine years, so I think the next market's about 3,800 today, 3,700. I'm pretty convinced the next 3,800 points will be up. It won't be down. The next 500 points, the next 600 points, I don't know which way they're going, so the market ought to double in the next eight or nine years. It ought to double again in the eight or nine years after that, because profits will go up 8% a year and stocks will fall. That's all there is to it. But you should study history, and history's the important thing you learn from. What you learn from history is the market goes down. It goes down a lot. The math is simple. There's been 93 years this century. This is easy to do. The market's had 50 declines of 10% or more, so 50 declines in 93 years, about once every two years, the market falls 10%. We call that a correction. That means that's a euphemism for losing a lot of money rapidly, but we call it a correction. So 50 declines in 93 years, about once every two years, the market falls 10%. Of those 50 declines, 15 have been 25% or more. That's known as a bear market. We've had 15 declines in 93 years. So every six years, the market's going to have a 25% decline. That's all you need to know. You need to know the market's going to go down sometime. If you're not ready for that, you shouldn't own stocks. And it's good when it happens. If you like a stock of 14 that goes to six, that's great. You understand the company, you look at the balance sheet, and they're doing fine, and you're hoping to get to 22 with it. 14 to 22 is terrific. 6 to 22 is exceptional. So you take advantage of these declines. They're going to happen. No one knows when they're going to happen. People tell you about it after the fact that they predicted it, but they predicted it 53 times. So you can take advantage of the volatility in the market if you understand what you're own. A lot of times people buy on the basis, the stock has gone down this much, how much further can you go down? I remember when Polaroid went from 130 to 100, people said, here's this great company, great record. But it ever gets below 100, you know, just buy every share, you know, and it could get below 100. A lot of people bought on that basis saying, look, it's got 135 to 100. It's not 95, what a buy. Within a year, it was 18. And this is kind of with no debt. I mean, it was just so overpriced. It went down. I did the same thing in my, I think my first or second year of fidelity. Kaiser Industries had gone from $26 this year to 16. I said, how much lower can it go? It's 16. So I think we bought one of the biggest blocks ever on the New York, on the America Stock Exchange of Kaiser Industries at 14. I said, you know, it's gone from 26 to 16. How much lower can it go? Well, at 10, I called my mother and said, Mom, you got to look at this Kaiser Industries. I mean, how much lower can it go? It's gone from 26 to 10. Well, it went to six, it went to five, it went to four, it went to three. And I ended up fortunately, this happened rapidly, I would probably be still caddying or working at the stop and shop, but it happened fast. It was able to, it was compressed. And at three, I figured out, you know, there's something very wrong here because Kaiser Industries owns 40% of Kaiser Steel, they own 40% of Kaiser Aluminum, they own 32% of Kaiser Cement, they own Kaiser Broadcast, they own Kaiser Santa Gravel, Kaiser Engineers, they own Jeep, they own business after business, and they had no debt. Now I learned this very early, this might be a breakthrough for some people. It's very hard to go bankrupt if you don't have any debt. It's tricky. Some people got approached that, it's a real achievement, but they had no debt. And the whole company at three was selling at about 75 million. In that point, it was equal to buying one Boeing 747. I said, there's something wrong with this company selling for 75 million. I was a little premature at 16. But I said, everything's fine. And eventually this will work out. And they, what they did is they gave away all their shares to their shareholders. They passed out shares in Kaiser Cement, they passed out shares in Kaiser Aluminum, they passed out their public shares in Kaiser Steel, they sold all the other businesses, and you got about 50 dollars a share. And, but if you didn't understand the company, if you're just buying on the fact that stock had come from 26 to 16, and then it came to 10, what would you do when it went to nine? What would you do when it went to eight? What would you do when it went to seven? This is the problem that people have is they sell stocks because they didn't know why they bought it, then it went down, and they don't know what to do now. Do you flip a coin? Do you walk around the block? You know, what do you do? It's psychiatrists that haven't worked so far. I've never seen them running in the psychological psychiatry fund. I've never seen this with the SEC to make it through as a mutual fund. So they haven't seen the help. I've tried prayer, that hasn't worked. So if you don't understand the company, you have this problem when they go down. Eventually, they always come back. This one is, this one doesn't work either. People think RCA just about to get back to its 1929 high when General Lecker took it over. A lot of double knits never came back. Remember those beauties? Floppy disks, Western Union. The list goes on and on. People saying it'll come back. Well, it doesn't have to come back. Here's another one you hear all the time. It's $3.00. How much can I lose? I've had people call me up saying, I'm thinking of buying the stock at $3.00. How much can I lose? Well, again, you may need a piece of paper for this, but if you put $20,000 in the stock at $50,000, or your neighbor put $20,000 at $50,000 into the stock, and you put $20,000 at $3,000, and it goes to $0,000, you lose exactly the same amount of money. Everything. And people say, it's $3.00. How much can I lose? Well, if you put a million dollars on it, you can lose a million dollars. This may be a reason to research a stock. The fact that a stock is $3,000 down from $100,000 doesn't mean you should buy it. And in fact, short sellers, people that really make money in stocks, they don't short Walmart, they don't short Home Depot, they don't short the great companies, Johnson and Johnson. They short stocks down from $80,000 to $7,000. They'd like to short it at $16,000 or $22,000, but they figured out at $7,000 that this company is going to go to $0,000. They just haven't blown taps on this thing yet. It's going to $0,000, and they're selling short at $7,000, they're selling short at $6,000, at $5,000, at $4,000, at $3,000, at $2,000, at $1.25,000. And you know to sell something short, you need a buyer. Somebody has to buy the damn thing. And you want to, who's buying this thing? It's these people saying it's three. How much lower can it go? Thank you, Peter. If you enjoyed his mindset and how we structured it when it comes to investing, please check my free stock market course, investing course, where we are summarizing Peter Lynch's book. Also, subscribe to this channel. And that's it. Click like if you enjoyed this. Thank you and I'll see you in the next video.