How Low Can Stocks & Crypto Go? March 17th, 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. I want you cashing in on both—without choking on rookie mistakes. 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: -2% (after a -2% gut punch last week)
- S&P 500: -4% (-1% last week)
- Nasdaq: -8% (-less than 1% last week)
A major relief rally on Friday after the Nasdaq and S&P 500 had entered correction territory saved the week from looking much worse than it does heading into this week. The major averages were still all lower for the week and the year, and specifically for the DOW it was the worst week in nearly two years. Yes, Trump tariff fears and slowing consumer sentiment continued to be major contributing factors, however in reality, this was a market that was in need of a correction following historic gains that had let to a historically pricey market. The great illustration of that point was the price action for stocks following last week’s two critically important inflation reports.
Both the Consumer Price Index and the Producer Price Index showed moderating inflation, and both came in lower than expected. That’s great news for stocks and yet the market continued to selloff following those reports on Wednesday and Thursday. It remains to be seen if we’ve seen the worst of it for this cycle, however on a personal note I moved a significant amount of money I had on the sidelines into the market just prior to Thursday’s close in anticipation that it might be. If nothing else, the market-wide selling created good value in select stocks. The big news to watch in the markets this week will be the Federal Reserve’s policy meeting. The markets are currently pricing in a 97% likelihood of interest rate policy remaining unchanged – however, even if that’s the case, what the Fed says in terms of the potential for when future interest rate cuts may occur will be a significant market mover. As for cryptos...
Digital coins are bleeding for an eighth straight week, post-Trump-election euphoria long gone. It was another week of losses for most digital tokens as the risk off trade continues to hurt the riskiest assets of all.
- Bitcoin: -2% last week, -12% YTD
- Ether: -8% last week -44% YTD (ouch)
- BitwiseETF (Top 10 cryptos): Off a bit 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: 28.17
- Historic Avg. P/E: 16.14
Translation: On earnings alone, the maximum downside risk is 43% drop from here—slightly better than last week’s 44% as price declines outpaced the fundamentals’ slide. 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 44% 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.