 Good day fellow investors. You always want my view and I have received a lot of comments. Tell us what you see and what you view and what is your opinion about what's going on. So today I'm going to give you my view on the markets. What do I think about the stock market now from my always long-term perspective and I will back it up with the data I see most important with the factors I see most important to look at now. Before I want to share a story I come I was born in Istria small part of Croatia Italian father Dutch mother practically I was not born in Croatia I was born in the Socialist Federative Republic of Yugoslavia communist country. So in that short time that I lived in Croatia in Yugoslavia I have seen a lot of things happen in my life I've seen hyperinflation I have seen countries go bust I have seen currencies go bust I have seen that go bust I have seen stock market booms I have seen stock market busts and I have seen stock markets that never ever recovered let me show you I started investing on the Croatian stock market index 2002 and invested a lot 2003 2004 and then enjoyed the run up up to 2005 6 then I sold everything because I thought it was crazy overvalued the stock market doubled again and everybody oh this will be so great so great 2009 there was of course the crash and the stock market the Croatian stock market never recovered and the country even never recovered the Croatian GDP is lower than it was in 1989 so my point here is okay I come from Croatia where everything that goes on works on a smaller scale and the country doesn't have the potential the monetary potential the power to save itself or to kick the can more down the road so if they make a mistake they have to pay for that mistake and the payment the reckoning they come soon and similar patterns that I have seen in Croatia stock market boom that recklessness and so are being seen all around the world which eventually will come to the end so that's my long long term view eventually the day of reckoning will come so we have to be prepared for both the stock market to go further up but also for a big big crash which by the way can come in many forms stock markets can go up and you would still think it's a crash so I come from a perspective where I expect anything to happen so I'm ready for everything and that's the way I like to be positioned prepared because anything can happen in the markets let me elaborate on that further there are a few things that are the key components of my view long-term view on the markets that is used recklessly all around the world valuations don't matter as growth is the key and profitability is expected to always come and always grow book values are so old-fashioned stocks and real estate can only go up and even if there is a correction or a bear market it won't last long as you have seen above in Croatia it can last very long and if you invest in index funds you can only do well so this is what the market thinks and this is also what I think are the keys and what you have to be very very careful because as Benjamin Graham used to say be greedy when others are fearful and be very fearful when others are greedy I think that greed is very very high now so I'm very very fearful let's start with that if you look at European household debt to GDP it went up from in the 2000s but now it has been declining so everybody is very very happy no worries things are getting better better and better right even if the US has a higher household debt to GDP ratio things are getting better it was very crazy in the 2000s 2008 now it's good right now I wouldn't say that because if you look at the total debt it has been just going up since I was born in third quarter of 1983 the total debt of the US increased 10 times which is very very significant and also it's at a much higher level than it was in the financial bubble of 2007 which means that okay this debt will be a burden and if you look at interest rates you can see that the debt has started to increase since the 1980s very very significantly or in other words since when interest rates have been constantly declining a turnaround in interest rates would lead to a very very painful deleveraging and a lot of changes in this world on the debt cycle I have seen it evolve twice Yugoslavia the country where I was born went bust because of the debt cycle and then in the 2000s the whole of Croatia was again high on debt and we can say that it again went bust because of the previously issued very very high and very expensive debt for such a small frontier country and just to show you the example of the recklessness of that if you go to casa.it where you buy the Zillow of the Italy where you can buy houses I have here found a random house for 450 000 euro you need to buy that you get an interest rate of 1.23 because the uribor is negative so and you get zero down payment zero antici pocarimie you really can buy a house with zero down payment for 30 years the fixed rate is a little bit higher 2.7 percent which is extremely crazy for Italy so this is an example of the reckless debt if interest rates go to 5 percent this house will be worth 200 000 and that would be a terrible terrible situation for whole of the economy because it's fueled by debt so it is completely unsustainable further the Fed thinks and the general opinion is that the global synchronized economic growth can be managed by carefully assessing what should be the interest rate level trying to keep inflation under control that's something that nobody never managed to do in the past so I find it highly unlikely that they will manage to do it in the future perhaps they will manage to do it for one year three four years but if we have a crash after four years your returns will still be negative and that's why I like to look at the long-term short-term moves they are irrelevant for your long-term investing performance there are many who say okay when the market inverts we are going to short we're going to be prepared that's impossible because it might be a correction and then you get prepared and then you lose then might be another correction then you get prepared and then you lose and then it's very difficult for non-professionals to time these things so the only thing a non-professional can do is to be prepared perhaps even renounce a little bit of returns that you would get if you are fully invested or if you do what everybody else is doing so you renounce a little bit but it gives you the protection and the power to do so much more when the opportunity knocks so to conclude on that and I will do all the other topics that I see very important in other videos not to crowd you with information to conclude on that I think as there is a lot of that and it's all well until everything goes well however when things start to turn when the world starts to change then you see okay then you see who is swimming naked when the tide shifts you see who is swimming naked and Warren Buffett constantly keeps telling us that so wherever you're invested try to look underwater I know perhaps it won't be sexy but try to look at who is swimming naked that should be the focus of every investor that now is invested or tries to invest the money to see okay what if it shifts what happens some things are going to do well some things are very well protected will be affected but perhaps not wiped out as many other investments will be so I'm going to finish here on that we're going to continue on interest rates valuations macroeconomics dividends how that works who is swimming naked and all those kind of things in future videos thank you for watching I'll see you in the next video