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Let’s Talk About FED Baby

Daily Chart September 24 InvestWithAlex

9/24/2015 – Another down day with the Dow Jones down 78 points (-0.48%) and the Nasdaq down 18 points (-0.38%) 

If you think I have been bearish, consider what Societe Generale’s Albert Edwards has to say. ALBERT EDWARDS WARNS: The next US recession will surprise investors, and a desperate Fed’s next move will be unprecedented

The next US recession will probably arrive a lot sooner than most investors expect and will likely see more desperate monetary experimentation from the Fed. Bob [Janjuah of Nomura] and I thought that this time we would see deeply negative interest rates in the US (and Europe). Sweden has led the way, dipping their toe below the water line with their current -0.35% policy rates but there will be more, much more along these lines. For if -0.35% is possible, why not – 3.5% or less? It goes without saying that deeply negative interest rates would be accompanied by a massively expanded QE4 in the US. The last seven years of exploding central bank balance sheets will seem like Bundesbank monetary austerity compared to what is to come.

Well, if -3.5% is possible, than why the hell not -50%?

I’ll tell you why. First, that would equal outright monetization. If that actually happens, my investment advice would be very simple. Invest in guns, ammo and canned food. Is the FED that stupid and irresponsible? They have brought us thus far, but that would definitely be something else.

As I have mentioned here many times before, the FED is unlikely to raise rates anytime soon. Which brings me to my point #2. Negative interest rates and QE  4, …5….6….. will have no impact on our capital markets and the overall economy.

Why? 

There is nothing to invest in. Notice, I didn’t say to speculate in. It is as simple as that. The stock market is in a massive bubble, by all traditional measures. The US Economy has plenty of spare capacity as is evident from the negative wage growth (inflation adjusted). Deflationary forces are re-appearing again, etc….

Point being, while the FED can literally drop money for a helicopter, they won’t be able to steer that money towards anything productive or good. Yes, some of it will go towards speculation, share buybacks, wars, etc…., but that will just create an even bigger bubble down the road.

In other words, the FED has already lost this game. It’s just that most investors don’t realize it yet.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2015-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2015-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 24th, 2015  InvestWithAlex.com

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Let’s Talk About FED Baby Google

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Just A Friendly Reminder From Carl Icahn

Soros Fund has a large short position. Just a few weeks ago, Jim Rogers said the following Jim Rogers: Major Correction Ahead…Central Banks To Panic. Now, Carl Icahn is warning people that we are once again at 2000 and 2007 tops.

“What is better…..making 1-2% or losing 30% as people did in 2008? Right now is extremely dangerous.”

Forget about my line of thinking here for a second. Who else do you need to tell you that we are in a massive bubble and that a big correction is coming. Warren Buffett? Actually, WSJ ‘Buffett Indicator’ Flashes Warning for Stocks

Anyway, if you are sick and tired of your typical Wall Street analysis…… “We are in the early stages of a secular bull market and right now is a buying opportunity of a lifetime”, do yourself a favor and watch the video below.

z33

What Carl Icahn Thinks You Should Do In Today’s Market Google

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What Investors Ought To Know About Today’s Stock Market

Daily Chart September 23 InvestWithAlex

9/23/2015 – Another down day with the Dow Jones down 51 points (-0.31%) and the Nasdaq down 4 points (-0.08%) 

The stock market is confused and so are most traders. From one vantage point, we are sitting on a buying opportunity of a lifetime. For instance, S&P 500: What’s on Tap for the Rest of 2015? 6 Reasons to Expect a Rally. From another, this apparent bear market is just starting. Stocks Will Slide Much More — Here’s How to Avoid the Pain of 2008

To complicate matters even more, most traders and Elliot Wave technicians I know expect the re-test of August’s lows before any sort of a rally materializes. Only if it was that easy.

Who is right? 

Even if I knew I wouldn’t tell you, but let’s take a closer look at those 6 reasons to be bullish. My comments are in greed.

1. History: Panic declines, like in August, tend to be followed by a period of testing and another low or at least a test of the initial panic low.

That is absolutely correct. However, how is that bullish is lost on me. 

2. Historical evidence: There have been 21 panic drops similar to the August one. 10 of them tested or broke the initial panic low before going higher. Five of them were a v-shaped recovery. Even three of the six instances that rolled over into a new bear market saw sizeable rallies after breaking the initial panic low.

Fair enough. We have rallied 1560 points on the Dow off of August 24th low or 10.2%. NDX was up 17.5%. Is that not sizeable enough? Just as a reference point, in 1929 the bounce was 12-13%. That was followed by a 50% drop. Again, I am failing to see how this is bullish. 

3. Seasonality: Late September to early October is one of the worst times for the S&P 500 in terms of seasonality (view S&P 500 seasonality chart).

Actually, it is October-November. I am staring to think that this article is written by a bear. 

4. Statistically: The S&P 500 ended August with a loss of more than 5%. This has happened 13 times since 1928. The September thereafter was positive only 4 out of 13 times.

OK, another worthless data point, but good to know. 

5. Post-Triple-Witching weakness: Since 1991, there have been 33 Triple-Witching Friday’s that ended in the red (like last Friday). Some 24 were followed by a weekly loss.

OK, another worthless data point. This is not indicative of anything. 

6. Elliott Wave Theory: According to Elliott Wave Theory, stocks move in segments of either three or five waves (this is a highly simplified explanation). Thus far, the S&P 500 has fallen in three waves. The current bounce looks like a wave 4 retracement, to be followed by another wave down (wave 5 — see labels on chart). Alternatively, the decline could only be three waves and lead to new all-time highs without prior new low.

Again, if it was this simple all Elliott Wave practitioners and/or followers would be billionaires by now. Plus, I am still confused about how this is bullish for stocks. 

All of the above is just noise. In reality, one must look at the long-term structure and the fundamentals. The stock market is incredibly overpriced, by most traditional measures. I have beaten this point to death on this blog over the last few years. Technically, the market did a quite of a bit of damage on the downside in August. Suggesting that a bear market might have already started. And that should be your primary concern.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2015-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2015-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 23rd, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

What Investors Ought To Know About Today’s Stock Market  Google

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Does America Crave War?

cold-war-investwithalex

WOW....things are now moving a lot faster than even I have anticipated in my report/book Nuclear World War 3 Is Coming Soon.When, How & Why Once again, while our government and media feed us irrelevant issues such as Iran, Isis, Syria, etc….., the real game is being played on Russia’s eastern front.

Here is the latest you need to know as we follow the blueprint in my report.

You know things are starting to get serious when the US/NATO start building up their nuclear arsenal on the Russian border. Don’t think for a second that Russia won’t retaliate. The only good news is, all wars have their own timing. And this one won’t start until the timeline outlined in my book fires off. But make no mistake, we are moving in that direction. Our only hope is that our next president can cool things off for a bit.

Which brings me to the last republican debate and the question above. I couldn’t stomach watching it for more than 20 minutes, but I got everything I needed to know in that short time span.

I typically pay attention to little things that most people overlook. When Carly Fiorina talked about our American military might and how she will “kick everyone’s ass” without even holding a dialogue, including Putin’s, she got a standing round of applause. When Rand Paul suggested the other side of the coin, dialogue and working together, he nearly got laughed off the stage.

My conclusion is simple. America wants and/or craves war.

Listen, I am not smart enough to figure out who is right or wrong here, most likely no one, but this will come back to haunt us all. In the meantime, no one has been able to offer me a legitimate answer to the following question…..What are the US/NATO troops doing on the Russian border? No one.

Finally, it is important to remind you of a simple truth.

“Put your sword back into its place. For all who take the sword will perish by the sword.”

Z31

Does America Crave War?  Google

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Why The Stock Market Should Be 50% Lower

Daily Chart September 22 InvestWithAlex

9/22/2015 – A down day with the Dow Jones down 182 points (-1.10%) and the Nasdaq down 72 points (-1.50%) 

I couldn’t agree more with Mark Spitznagel here. Apparently he made over a Billion (at least Intraday) during August’s market drop. It appears that our fundamental and market views match up to about 95%. So, instead of me yapping about this for the 100th time, I will let Mark tell you what he thinks.

“If August was scary for people, they ain’t seen nothin’ yet.”

If you participate in financial markets, this interview is definitely worth a few minutes of your time.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2015-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2015-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 22nd, 2015  InvestWithAlex.com

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Why The Stock Market Should Be 50% Lower  Google

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10-Year Note: All Systems Are A Go For A Double Bottom

10 Year Note Chart InvestWithAlex

I sold my large 10-Year Treasury Note position in January of this year, after a 12 months holding period. At that juncture I wasn’t yet confident about what the FED bureaucrats were about to do or how aggressive they would be. That ended up being a good move as treasuries have remained in a fairly tight trading range over the last 10 months.

With that in mind, I believe the picture has now clarified as I shift back to my original assessment. That is, we will see a double bottom in rates before this bear market of 2015-2017 in equities completes itself. And as my previous posts indicate, I believe the FED will no longer raise interest rates at this juncture. Particularly, if the stock market takes a beating, something that I very much expect, while the US Economy slides back into a recessionary environment. Something that is now becoming evident.

Generally speaking, the BOND Market is more intelligent. Yields not surging higher is indicative of what the bond market sees. What does it see? Exactly that, a significant recession and a possible bear market.

Finally, 30-Year bear markets in Bond Yields DO NOT end in a V shape fashion. Typically there is a double or a triple bottom. Plus, there is a number of large gaps in the 10-Year treasury, suggesting that the bond market will retest it’s 2012 and 2013 yield lows. Possibly taking the market as low as 1.5-1.6%.

Impossible? On the contrary, that is exactly what I expect to see over the next 12-24 months. As the FED itself suggested, the next round of QE and negative interest rates might be just around the corner.

z32

10-Year Note: All Systems Are A Go For A Double Bottom Google

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The FED Has Lost Control And Credibility

Daily Chart September 21 InvestWithAlex

9/21/2015 – A positive day with the Dow Jones up 125 points (+0.77%) and the Nasdaq up 2 points (+0.04%) 

The FED generals are out in force to proclaim that the FED hike is still possible later on this year. Nothing new here, they have been feeding this to investors since the beginning of this year.

With that in mind, someone should tell the FED that their credibility is now gone. Most investors have figured out by now that they will not raise. Not in October and not next year. For the reasons outlined here, Can The Stock Market Crash Due To The FED’s Inability To Raise Interest Rates? and here The FED Blinks. How Will The Market React?

In terms of the stock market, it might be as simple as this. Occam’s razor says the stock market is in a downtrend

trend is your friend investwithalex

In addition to that, the Dow Theory (if you are a follower) has confirmed a shift into a bear market at the same time. So much so that the stock market would have to stage quite a rally, pushing itself to new highs, just to force itself out of this longer-term bearish pattern.

Is that impossible?

Not necessarily, but you better have a good response to the following question…..why would it?

  • Are earnings about to surge higher? Especially now that the liquidity is drying up and stock buybacks are slowing down.
  • Will the US Economy stage some sort of a miraculous recovery and surge higher?
  • Will the FED flood the market with QE-4..5…6 and negative interest rates?
  • Are we in a “this time is different” environment where the stocks are no longer expensive?

And you if you have answered “YES” to any of the above, you might want max out your margin and load up on stocks here.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2015-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2015-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 21st, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

The FED Has Lost Control And Credibility  Google