Moon gang: what in the world happened in the stock market today? Well, to put it simply taxes to be more specific, a tax increase now before we get into this video. Please remember that i am in no way a political commentator. I talk about stocks and sometimes the political arena and the stock market do overlap. Don't take me covering the news to be some sort of expression of my own political opinions, and i am certainly in no way telling you what your political opinion should be all right.

So now, let's hop into it so on the screen. Now is the s p. 500. The s p 500 is an etf, which is a fancy way to say, exchange traded fun.

Basically, the best way you can think of it is a basket that tracks 500 of the biggest companies within the united states so because of that, it's considered to be a good barometer for the overall stock market. Well, around 1 pm today it was announced that the current president is planning on. He is going to have a proposal that does increase taxes, and you could see the impact it does look more severe than it actually is, and i'm going to touch on that. This is in no way a stock market crash, i'm in no way calling for doomsday, and i think that the graphs i can show you will make you feel a little bit more comfortable because i'm sure you've been reading some pretty crazy headlines today.

My goal in this is to explain what happened and in all eventualities how it's really not that bad in terms of where we are in the overall picture of the stock market. So anyway, around 1 pm it was announced about a potential tax rate increase and the stock market dropped from around 416.78 all the way down to 411.. So if you do a quick math on that, that's about 1.5, so this does look more severe than it is. It was about a one and a half percent drop and then from there we had a balance and closed out the day at 412..

So this is the best summary of what i could find if you just need a quick takeaway from this video right here. This is from walter bloomberg on twitter biden will propose raising marginal income tax rate to 39.6 from 37, which is obviously just a 2.6 percent increase, but that is for marginal income. The bigger thing that i think more people are talking about is biden will also propose nearly doubling taxes on capital gains to 39.6 percent from people or people who are earning more than 1 million dollars. That's a quick takeaway for those of you who want more a bit more detail.

I would recommend checking out this article on bloomberg. I will make sure to link it in the description below just if you need all those details, but i just i quickly highlighted the key takeaways biden, eyeing tax rate as high as 43.4 percent. In next economic package, people earning 1 million will pay 39.6 plus obamacare levy. Total tax rates for new yorkers and californians could top 50 percent.

I don't live in new york or california, but for those of you who do if this goes out, i feel for you, president joe biden will propose almost doubling the capital gains tax rate for wealthy individuals to 39.6 percent to help pay for a raft of social Spending that addresses long-standing inequality for those earning 1 million or more. This means that the federal tax rates for wealthy investors could be as high as 43.4 percent. The new marginal 39.6 rate would be an increase from the current base rate of 20. There is more details in here.

I implore you to read this. Please do your own due diligence, please feel free to fact check me, i'm just trying to present. What's going on and more importantly, uh. Yes, increased taxes.

It makes sense that especially these wealthy individuals, a lot of these people are the people who really kind of control the stock market. They have a lot of money in the market, so when they see tax rates this high, it becomes kind of a risk-off environment of like right there like when you also increase taxes. It's now all like. Do you with an increase in taxes? Do you also want to take the extra risk of just the overall stock market so right there that obviously scared some people away and that's what caused the stock market to drop? I know this looks severe, but the one thing i want to point out to you is first of all, from the start of 2021.

Until now, the s p 500 is still up 10, usually year over year. We do expect the stock market to gain seven percent. That's a big average that a lot of us point to seven to eight percent right now, we're already up above that we're up 10. This.

This isn't a doomsday. Some people talk about bear markets, the i guess statistical measure for bear market is when we drop 20 from that high, so we're not even close to that. The all-time high happened a couple days ago, literally as recent as april 16th. Just so you know, i am filming this on april 22nd, so my point is not that long ago we already hit an all-time high, like literally the market has never been this high, so whenever's talking about doomsday stock market crashing.

I would argue i i just don't see it we're not that far off at the literal all-time high. That was four. Let's just call it 418 right now we're trading at 412.. We haven't come down that much roughly, you know.

Actually, we could get the exact number for you uh, so from that all-time high, we're down 1.35 percent, it's okay, um, and if you want to feel better about it, let's just zoom out when in doubt zoom out. So if we look at this so on the screen now is basically the low from march of 2020 until now the stock market, because of many things uh that could be literally a whole nother video. But my point is look at how much we've come uh. We bounced off of 219 all the way up to 417..

It's just been up up up, i mean from this low until where we are now we're up 79.93 percent. I think it's okay for us to take a one, two percent dip. Of course, i don't know this could become something bigger. I just don't think it will um so anything out there like just don't let your emotions drive your investing decisions right now, if you're seeing a little bit of a red day in the market, we drop point.

Nine percent from open to close, don't let this the fear of like oh, my god, it's crashing it just hasn't happened. Yet we're not seeing that in the market, i'm just trying to make. You feel a little bit better and i'm trying to point out the stats. The facts here the market's been on an incredible rally from march of 2020 until now, honestly, even without this tax rate increase announcement.

If we look at the rsi here that stands for relative strength index, which maps out it just maps out bullish to bearish momentum, it has values of zero to 100. Typically, if something's over 70, it's considered to be very very bullish, also considered to be overbought below 30 is considered to be very bearish, also considered to be oversold. So even without this announcement look at that, we were over 70.. It was already considered to be overbought, which means like there was a good statistical chance of a healthy reversion.

I said healthy, very intentionally because the stock market - it doesn't always just go up. Yes, you should expect healthy corrections and, honestly, i thought we were already due for one without this news and i think, if anything, this news is just going to kind of prompt that, like a little bit of a healthy traction, a healthy retraction potentially to one of These support levels - i have mapped out 410 below that we have 405. Of course 400 is the key psychological level. So that's what i'm personally watching 410 405 400 below 400.

If we break below that yeah, there might be a little bit for a bit of a concern, but i'm in still in no way calling for a doomsday or anything like that, because the stock market has absolutely been on fire from march of 2020. All the way up until now, so don't let these big announcements like fool you for anything yeah. This will hit the market um people. They don't want to pay higher taxes.

They will pull money out of the stock market. It's a natural reaction but uh. My point in making this is just trying to express that it's not as bad as some of these headlines will make it to seem to believe. But who knows, these are my own opinions, i'm in no way financial advisor.

I would love to get your thoughts in a comment below. Do you think that this isn't somehow doomsday? Personally, i'm not on board with that? I don't think that the stock market is craption crashing, but i maybe i'm getting it wrong. I would love to know your thoughts in a comment below if you enjoyed this video, i would appreciate it if you could drop a like. Also, if you want to leave a comment, all that stuff does help with uh help me out with the youtube algorithm.

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