Yesterday, after hiking interest rates by 0.75%, the most in a single meeting since 1994, Federal Reserve Chairman Jerome Powell said, “We’re not trying to induce a recession.” This will go down in history as one of the biggest lies ever, alongside Powell’s remarks in 2021 that inflation will be “transitory.” He probably said thisContinue reading “The Fed is Determined to Crush the US Economy”
Category Archives: Uncharted Waters 🌊
Markets on the Brink as Ukraine Declares State of Emergency
US stock indices are sitting at major long-term support levels: You can see that the S&P 500 is at its Jan. 24 low. It is crucial for the index to bounce off this level, or else it essentially confirms stocks are in a full-blown downtrend characterized by lower lows and lower highs (as opposed toContinue reading “Markets on the Brink as Ukraine Declares State of Emergency”
When Will The Stock Market Stabilize?
The short answer is: maybe not for a long time. But I want to go into a bit more detail on some of the main reasons I believe the stock market pain is not over and will likely continue, possibly for the foreseeable future. 1. Investors Are Still Bullish on Stocks There is still aContinue reading “When Will The Stock Market Stabilize?”
What is Worse: Inflation or Deflation?
Amidst all this talk about inflation lately, one could be forgiven for forgetting the existence of the yin to inflation’s yang, deflation. Joe of Heresy Financial on YouTube recently brought up an interesting point on the matter, and essentially his point was that the Fed cares way more about deflation than it does about inflation.Continue reading “What is Worse: Inflation or Deflation?”
How High Should Interest Rates Be Right Now?
We hear a lot today about how the Fed is “behind the curve” and is allowing inflation to get out of control, but how can we actually quantify this? Just how far “behind the curve” is the Fed right now? It’s difficult to say because ultimately the Fed’s decisions on interest rates are subjective andContinue reading “How High Should Interest Rates Be Right Now?”
The Stock Market is About to Experience a “Death Cross”
Helene Meisler pointed this out today: The “death cross” is when, on the daily candlestick chart, the 50-day moving average (DMA) line dips below the 200-day moving average. It is generally an indication of a significant change in direction in the markets, and always precedes massive collapses in stock prices. For instance, before the marketContinue reading “The Stock Market is About to Experience a “Death Cross””
Things Are Not Looking Good for the US Economy Right Now
Time for some fire and brimstone. First up, University of Michigan’s Consumer Sentiment chart, which has dropped down to 2008 Global Financial Crisis levels: Inflation and unaffordable housing probably has a lot to do with this. This is a gauge of the “real economy,” and the the real economy is in bad shape right now.Continue reading “Things Are Not Looking Good for the US Economy Right Now”
Japan’s Prime Minister Admits Country Has Been Overstating GDP Figures For Years
This story is from December but I completely missed it. It’s highly relevant to us in America, though, and I’ll explain why shortly. Via Bloomberg Markets: Japanese Prime Minister Fumio Kishida apologized for the government’s mishandling of economic data after media reports said it overstated construction order figures, a key numbers set used to calculateContinue reading “Japan’s Prime Minister Admits Country Has Been Overstating GDP Figures For Years”
How the Stock Market Performs Without QE, 2008-Present
To underscore my point that the rules of the game have changed and that we are now in uncharted waters when it comes to the Fed and the stock market, I think it might help to illustrate just how important the Fed’s accommodative monetary policy is for the stock market. There have been 6 stretchesContinue reading “How the Stock Market Performs Without QE, 2008-Present”
The US Economy is Not in Good Shape
There seems to be this narrative being forced out by the Brandon administration and their accomplices in the corporate media that the economy is “booming” and going gangbusters. They back it up with data that shows GDP surging and wages increasing, as well as generally strong earnings reports from public companies (Facebook, Netflix and PayPalContinue reading “The US Economy is Not in Good Shape”
Inflation is the Most Important Thing Right Now
I have been writing a lot lately about the economy and the market. I know it’s a bit of a departure from what I usually write about here, but I write about things that I believe are important. I am only one person running this website, and it’s impossible for me to write about everythingContinue reading “Inflation is the Most Important Thing Right Now”
Is it Time To Get out of the Stock Market?
“You can’t time the market.” That’s what you always hear from value investors and even professionals who are asked to give advice to newbies. And it’s largely true, at least as it concerns you: you cannot hope to time the market like the professionals do. But the thing is, market timing is extremely important. ItContinue reading “Is it Time To Get out of the Stock Market?”
Do Low Interest Rates Depress Economic Growth Over the Long-Term?
The conventional wisdom around the world is that low interest rates are conducive to higher economic growth, while higher interest rates reduce economic growth. This is certainly true. We see it consistently: economic recovery begins when interest rates get slashed, and recessions begin when interest rates get too high. It’s the way the global economyContinue reading “Do Low Interest Rates Depress Economic Growth Over the Long-Term?”
The Stock Market is in Much Worse Shape Than You Think
Everyone knows the stock market has been going through a rough patch recently. You can see the S&P 500 is down about 10% from its all-time high, the Dow is down 7.5%, and the Nasdaq is down 17.6%. But this does not tell the true story. The S&P only reflects the performance of the 500Continue reading “The Stock Market is in Much Worse Shape Than You Think”
Will The Fed Let the Stock Market Crash?
The Fed is in very tough spot here. With inflation on the rise, it has to take action to get that under control. If inflation is unchecked, it will destroy the US dollar. That’s a very extreme situation, of course, as we’re a ways off from hyperinflation, but once you get trapped in a realContinue reading “Will The Fed Let the Stock Market Crash?”
Fed: Money Printer Being Turned Off in Early March, Expect Interest Rate Hikes March 16
The summary of today’s FOMC statement along with Powell’s press conference remarks: The Federal Reserve on Wednesday signaled it is likely to raise U.S. interest rates in March and reaffirmed plans to end its bond purchases that month before launching a significant reduction in its asset holdings. Bond purchases = money printing. That’s the processContinue reading “Fed: Money Printer Being Turned Off in Early March, Expect Interest Rate Hikes March 16”
Tell ’em: Charlie also shared these charts: Why isn’t the Fed raising rates? Because they know the slightest uptick in rates could pop this whole bubble. The Fed will tell you that they’re keeping rates low because the “real economy” hasn’t yet caught up to the market. But isn’t this an implicit indictment of FedContinue reading “🔥🔥🔥”
11 SIGNS WE’RE IN A BUBBLE
On the 21st anniversary of the end of the Dot Com Bubble to the exact day, we find ourselves in yet another market bubble. Like 2000, the signs are all around us, and they go beyond just the stock market. There are certain behaviors, trends and mindsets that take hold during a speculative mania, butContinue reading “11 SIGNS WE’RE IN A BUBBLE”