...harder economic times are ahead, and people can't take as much risk - losing money on the stock market (and not taking profits before they're gone) is double whammy to personal finances if one loses job as well
...uncannily, US household allocations to stocks knew to pre-empt before recession is declared. Either this is because they needed to sell stocks to raise cash to tie through living expenses OR the markets were on the backfoot well before the recession was officially declared, possibly Both.
...yes, many are playing with living expenses money (that they cannot afford to lose) and speculating. An online slot machine equivalent.
...and too often discipline is hard to maintain- stay happy with the gains made earlier ; the only way to lose them would be to continue in the game, as that's how people lose money in the casino, spending the entire day at it, winning then losing them all back and more. Free buffet thrown in to keep punters away from running with their gains.
BREAKING: US households' allocation to stocks fell 1.3 percentage points in Q1 2025, to 43.1%, the lowest since Q1 2024. This marks the largest quarterly decline since the 2022 bear market. However, households’ stock allocation as a percentage of financial assets is still well above the 2000 Dot-Com Bubble peak of 38.7%. To put this into perspective, at the low of the 2008 Financial Crisis, allocation to equities was at 19.0%. Furthermore, current allocation to cash stands at 14%, near an all-time low. Retail remains heavily exposed to the stock market.
