The Karate Kid III

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Plot hole: The tournament that Daniel is in is the All Valley under 18 tournament, but we already know that he has graduated from high school and was about to attend college. His birthday is in December, so he must already be 18.

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Mr. Kesuke Miyagi: Inside you same place you karate come from.
Daniel Larusso: My karate comes from you.
Mr. Kesuke Miyagi: Ah. Only root karate come from Miyagi. Just like bonsai choose own way grow because root strong you choose own way do karate same reason.
Daniel Larusso: I do it your way.
Mr. Kesuke Miyagi: Hai. One day you do own way.

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Trivia: The expression "Cobra Kai never dies" was invented for this film; it was never uttered in the first Karate Kid movie.

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Answer: He lost all his students after he flipped out on Johnny. Without students, he couldn't pay his bills.

Greg Dwyer

Answer: Kreese strangled Johnny, after the latter lost to Daniel. This proved just what kind of teacher, as well as person, Kreese is. His students after seeing this, realised just what Cobra Kai puts in their head, as well as just what kind of person and teacher Kreese is. Specifically, after seeing Kreese strangle Johnny, they thought, "I WON'T be your student, if you're gonna treat me like that!" Therefore, they left, and Cobra Kai went out of business.

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