THE BOTTOM LINE: Historical crashes and where the market stands today


This week:

  • A rough week for Blue Apron and Snap both of which went public in 2017. Blue Apron went public at the end of June, at $US10 a share, and has been slowly declining since. This week, Northcoast Research published the first Wall Street price target for the stock at $US2 a share. Snap gained 44% on its first day of trading in March but has since been coming down and closed below its $US17 IPO price for the first time on Monday. Morgan Stanley analyst Brian Nowak downgraded the stock on Tuesday from overweight to equal weight and cut his price target from $US28 to $US16 a share.
  • Business Insider executive editor Sara Silverstein discusses a recent research note from Fundstrat’s Tom Lee says bitcoin could be a true substitute for gold and cannibalise some of the $US7.5 trillion market. Lee estimates the cryptocurrency could be worth $US20,300 by 2022. This estimate is based largely on the assumption that bitcoin can increase its share of the “alternative currency” market, which is mostly gold, from 0.7% to 5%.
  • Scott Nations, chief investment officer of NationsShares and author of “A History of the United States in Five Crashes” discusses lessons from history. Nations says the all of the modern-day crashes have some sort of a financial contraption and an external catalyst that often has nothing to do with the markets. He discusses some of the financial contraptions today that could pose a risk in the future. Nations also talks about the current low level of volatility in the market and what to do in the event of a crash.
  • John Manley, chief US equity strategist for Wells Fargo Funds, spoke to Business Insider senior markets reporter Joe Ciolli and discussed the potential side effects of the Federal Reserve unwinding its unprecedented monetary stimulus. He shared his thoughts on how to play a market top and stressed the importance of investor flexibility. Manley explained why a healthy dose of pessimism is always good for an investor and discussed the dynamic of rapidly growing, technically advanced companies like Amazon shaking up various industries.

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