Market corrections, pullbacks, crashes, and scams are terms you must have heard quite a bit, but what do they actually mean?

Let’s explain with a simple potato story. Imagine you are selling potatoes in town. The price is usually stable, and business is good. One day, a rumor suddenly spreads: "There will be a French fries festival, and the best French fry winner can win a grand prize!" As soon as the news comes out, everyone rushes to buy potatoes, demand surges, and prices rise accordingly. This situation is a natural reaction when market demand increases.

Next, some traders appear, buying large quantities of potatoes, deliberately creating a shortage, and driving up prices. At this point, prices have risen by 60%. But soon, the government intervenes and announces that the supply of potatoes in the market is sufficient, calming everyone’s panic, and prices adjust back down, decreasing by about 10%.

This phenomenon is called a "market adjustment." After an excessive market reaction, prices will correct themselves and return to a more reasonable level.

However, new sellers emerge in the market. After hearing about the rising potato prices, they come with even more potatoes to sell. As supply in the market increases, prices drop again, this time by 25%. This is what we call a "market pullback," a temporary price decline caused by new competition or increased supply.

But the story doesn’t end there. Suddenly, the government decides to import a large quantity of cheap potatoes. At this point, panic ensues, and people stop buying local potatoes. As a result, prices plummet by 50%. This is a "market crash"—a sharp price drop triggered by unexpected news or significant events.

Finally, the truth is revealed: there was no French fries festival; those traders fabricated the lie just to inflate prices. Once the news spreads, the market completely collapses, and prices nearly reach zero. This is a typical "market scam"; when the market is manipulated and people lose trust, prices experience catastrophic declines.

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