How Low Can Stocks & Crypto Go? March 24th, 2025
Buckle Up: The Markets Are Testing Your Nerves—Here’s What You Need to Know
Bottom Line: My first rule of money... Never let your money and emotions cross paths. This isn’t a doomscroll—it’s a wake-up call to show you the near-worst-case scenario for stocks and crypto. Why? So, you can plan your financial future with a cool head, not a racing pulse.
The US stock market is history’s ultimate wealth-building beast. Crypto? It’s minted millionaires from early believers. Fact: Over 90% of the time, investors who try to “time” the market end up poorer than if they’d just stuck to their original investments. This is about dodging that trap.
Let’s dive into the carnage—here’s how the big dogs are faring in 2025 so far:
- DOW: -1% (up 1% last week)
- S&P 500: -3% (up less than 1% last week)
- Nasdaq: -8% (up less than 1% last week)
Stocks ended a four-week losing streak last week after having had the Nasdaq and S&P 500 enter correction territory during the previous week. While investors are still trying to sort out what will happen next with the economy – there were two developments that helped soothe some nerves during the week.
The Federal Reserve’s policy meeting ended without a change in interest rates, which was expected, however importantly they didn’t change their stance of likely implementing multiple rate cuts during the year this year. That had been in question following the tariff battles between the Trump administration and most of our trading partners...speaking of which that brought about the other meaningful development during the week.
President Trump mentioned that constructive conversations were being had with many countries that stand to face new tariffs and/or higher tariffs as we enter April. As a result, he said there may be some “flexibility” regarding the implementation of additional tariffs. The one other somewhat improved economic development came from the Atlanta Federal Reserve’s GDP Now calculation that two weeks ago suggested the US economy could contract by 2.5% in the first quarter. The most recent estimate has the number pegged at negative 1.8% - obviously not good but also trending in a better direction.
As for cryptos...
Digital coins finally ended their eight-week losing streak last week. It remains to be seen if it was a pause in the bigger picture bear market or a bottom having been put in. As for the price action...
- Bitcoin: +2% last week, -12% YTD
- Ether: +4% last week -40% YTD (ouch)
- BitwiseETF (Top 10 cryptos): Flat last week, -20% YTD
I can’t value cryptos because they have no inherent value. Stocks, though? They’ve got bones. Let’s break down the S&P 500:
- Current P/E: 28.23
- Historic Avg. P/E: 16.14
Translation: On earnings alone, the maximum downside risk is 43% drop from here—flat over the past week as prices and fundamentals were pretty much static. The market is still historically expensive; however, we have seen a 5% improvement in the fundamental value of the market during this correction cycle.
So, What’s Your Move?
If a 43% dip wouldn’t derail your life, you’re probably golden. If it would? Time to call a pro and build a plan that doesn’t leave you sweating bullets—or broke.
The markets don’t care about your feelings. Don’t let them hijack your wallet.