Being 80% Buffett

    On March 9, the US stock market plunged, the three major stock indexes closed down more than 7%, Buffett: "I lived 89 years, the second time in my life to see the US stock market circuit breaker."

    On March 12, the US stock market plunged again and closed down 9.9%, the third time in history.

    Stocks continued their plunge on March 16, ending the day down 12.93 percent. The fourth circuit breaker in history:

    On March 19, the US stock market still plunged, closing the day down 6.3%. This is the fourth circuit breaker in 10 days, and the fifth in the history. That's right, you've got 80% of Warren Buffett's life experience in 10 days.

    The reasons for the stock market plunge in the US can be summarized as follows :1. COVID-19 is the fuse, which gradually impacts normal economic activities and life in society, leading to a decline in risk preference and an increase in risk aversion among investors; 2. The impact of the epidemic spread to the global oil demand decline, coupled with the outbreak of a price war between Saudi Arabia and Russia caused the global crude oil price to plunge, down 55.0% in this month alone, resulting in the us stock market and high-yield bond market in the energy sector prices also fell sharply; 3. Us public companies have continued to buy back shares on a large scale over the past decade. Buybacks can help improve the earnings per share of listed companies and boost stock prices by making shares more attractive. In addition, passive trading, represented by exchange-traded Funds (ETF), is prevalent. On the one hand, the expansion of passive trading means that large-cap stocks can be bought more, and eventually form a clear market bubble.