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Bill Gross Compares Global Financial Markets To A Giant Ponzi Scheme

It’s a breath of fresh air when a big money manager speaks the truth instead of perpetuating “Now is a buying opportunity of a lifetime” line of thinking. Bill Gross delivers again.

The global financial markets are a “shell game” thanks to government interventions like quantitative easing, and once the manipulation stops, the markets may drop, bond legend Bill Gross said Wednesday.

The only problem with the above is “may drop”. “Will drop” would be a much more accurate statement. Watch the video below, it is worth 3 minutes of your time.

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Bill Gross Compares Global Financial Markets To A Giant Ponzi Scheme Google

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The FED: Now Powerless, Awaiting Hard Impact

Daily Chart Uly 29 InvestWithAlex

7/29/2015 – Another positive day with the Dow Jones up 121 points (+0.69%) and the Nasdaq up 22 points (+0.44%). 

As predicted here yesterday, Janet Yellen and the FED continue to beat around the bush. Here is my take on all of this. They are either really…really stupid -OR- they understand exactly where we are and literally feel paralyzed.

Further, from what I can tell, no one out there shares my view. A view I deem to be very accurate from a sheer stand point of what my mathematical and timing work shows happening in our capital markets over the next 24 months.

Sometimes a picture is worth a thousand words. The picture below is, more or less, exactly where the FED finds itself today. The plane is on fire, there is no hope, impact is imminent and it is just a matter of time.

plane on fire

That is to say, it is too late, they have missed the boat on raising interest rates. Let me give you a hypothetical example. What do you think will happen if the stock market crashes 25-30% between now and November, bringing the US Economy to screeching halt……in the very same fashion it did in 2008?

And if you believe that is impossible, you shouldn’t be investing in capital markets. Period. 

Well, the FED will find itself in an impossible situation. There is very little they will be able to do in order to backstop the market and/or prevent a severe recession. Remember, the interest rates are still at zero. Another round of QE? Most certainly, but there is no reason to believe that the bond market won’t throw a fit this time around.  In other words, checkmate and game over for the Fed!!!

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. July 29th, 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: Now Powerless, Awaiting Hard Impact  Google

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Why Short Sellers Should Drool All Over Facebook

Facebook FB - InvestWithAlex

When Twitter (TWTR) was selling at $48, I wrote this….Why Twitter (TWTR) Should Go On Your “Stocks To Short” List  Less than 6 months later it is trading 35% lower. With that in mind, I continue to maintain that the worst is yet to come for the company. By the time upcoming bear market ends, Twitter should be below $10.

Now, here is why short sellers should drool all over Facebook.

And while I might eat crow for dinner tonight, this view is a longer-term one. Even if Facebook (FB) reports great earnings and jumps higher later on today, I continue to believe that Facebook is one of the best shorts out there. That is to say, if a jump does occur, use it as an opportunity to load up on the short side. That is, after upward pressure, if any, dissipates and the stock reverses.

While most investors today will laugh at me when I suggest that Facebook (FB) will see $20 a share over the next 3 years, I will laugh back when it does. I promise. Here is why……

  • As discussed over the last few days, Facebook is massively overpriced. At its $275 Billion market cap, the company is now worth more than GE. At 10th the revenue base and a P/E of 95. I guarantee you, investors in Facebook today will look back in 2-3 years and wonder “What the hell were we thinking”.
  • I am beginning to notice quite a bit of fraudulent activity on Facebook when it comes to likes, promotions, paid advertising, etc… That is firsthand knowledge, but you can Google the same and do your own research. That suggests the Facebook is running out of growth and its multiple is not justified. By a long shot.
  • See those massive gaps all the way down to $20 a share? Yep, they will have to be closed at some point.
  • We are on a verge of a multi-year substantial bear market. Click Here. When such bear markets develop, if past is any history, such overvalued and over hyped stocks tend to lose 80-90% of their value. Just as the gaps above suggest. I don’t know why this time would be any different.
  • Short interest is low.

Finally, even at $20 a share, Facebook will be extremely overpriced. In other words, I just gave you a 80% gainer, but its up to you what you do with it. As always, TIMING is the key here.

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Why Short Sellers Should Drool All Over Facebook Google

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Cold War Accelerates As Ruble Plunges

cold-war-investwithalex

As I have mentioned before, forget everything else. This is the most important issue and it will impact all of us. A quick update on the subject matter.

Most people will argue against my World War 3 forecast by saying that any such war is impossible in today’s day and age. I would disagree, as would our scientific community. It is just a matter of time now. My report outlines exactly WHEN it will start.

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Cold War Accelerates As Ruble Plunges  Google

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Is Janet Yellen Ready For Her Market Hazing?

Daily Chart Uly 28 InvestWithAlex

7/28/2015 – A positive day with the Dow Jones up 188 points (+1.08%) and the Nasdaq up 49 points (+0.98%) 

Well, as was discussed here last night, Dennis Gartman maintains his perfect “reverse” turning point track record. With that in mind, the stock market continues to behave as per our internal forecast. If you would like to find out what happens next, please Click Here. 

Tomorrow we have the Fed interest rate decision. And since they have been SO accommodating  to the market over the last few years, we shouldn’t expect anything surprising. Which brings us to my two primary Fed related themes.

First, I continue to maintain that the FED has missed the window of opportunity to raise interest rates. It is too late now. Why?  They needed to reload their recession fighting tool kit before the next recession or bear market strikes. The problem is………we are already there as per my mathematical and timing work. That will become evident to everyone else over the next 12 months.

That is to say, the stock market/economy will collapse while interest rates remain at ZERO. What will they do…..another round of QE? Most certainly, but that won’t save the day. The bond market might react to such a development in a negative way this time around, driving yields higher, not lower.

Second, every FED Chairman since Paul Volcker, and to a certain extent before, has been baptized by fire of a large scale market sell-off. Let me give you an example.

  • Paul  (The Iron Will) Volcker: Took office in August of 1979. Last down leg of a 1966-1982 bear market started in April of 1981. Baptized by fire 1.5 years into his tenure.
  • Alan (The Master Printer) Greenspan: Took office in August of 1987. Baptized by fire just two months later, when the crash of 1987 took place.
  • Ben (The Savior) Bernanke: Took office in February of 2006. The 2007-2009 bear leg started in October of 2007. Baptized by fire 1.75 years into his tenure.
  • Janet (Everything is Peachy) Yellen: Took office in February of 2014. Now 1.5 years into her tenure.

I am sorry to tell you this Ms.Yellen, but if the trend above holds true, you are about to get creamed along with every other bull out there. Just saying!!!

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. July 28th, 2015  InvestWithAlex.com

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

Is Janet Yellen Ready For Her Market Hazing Google

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Dispelling The Myth Of Long-Term Stock Market Prosperity

Nikkea2

Take a look at this Nikkei 225 stock chart. The index is still 50% down from its top 25 years ago. In the past I have identified two even longer periods within the US stock market when inflation adjusted returns remained at zero. That is, 1790 to 1860, a 70 year period of time and 1899 to 1949, a 50 year market cycle.

That would be incomprehensible to most investors today. For instance, take a look at this typical write up of how 50% of Americans are somehow missing out on this magical wealth generating engine that is the stock market.

More Than Half of All Americans Could Be Set Up for Financial Disappointment — Here’s Why

More than half of Americans are set up for financial disappointment According to the Money Pulse survey released in April by Bankrate, a whopping 52% of adult Americans don’t have a single cent invested in the stock market. This includes individual stocks as well as stock-based investments such as a mutual fund.

I would argue that they the smart ones, not the other way around. Take a look at the S&P chart below. That is an inflation adjusted return since 2000 or lack thereof. What’s worse, we are on a verge the next bear leg.

So, instead of trying to scare people into the stock market, financial professionals should spend more time on minimizing risk the “unlucky” 50% are about to suffer. If you would be interested  in learning exactly when this bear market will start, please Click Here

S&P inflation adjusted

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Dispelling The Myth Of Long-Term Stock Market Prosperity  Google

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Did Our Secular Bear Market Terminate In 2009? Keep Dreaming

1-aWhen it comes to the overall stock market or individual stocks, investors are always able to find at least a dozen data points to support their investment decision. Whatever that decision might be.

Lately, quite a few people have been coming out of the woodwork in an attempt to justify today’s bull market. Here is one of the dumbest I have seen in a while…..Stocks just did something they haven’t done since 1904

“The S&P 500 did something in the first half of 2015 that it has not done since 1904 — the S&P 500 posted two consecutive (back to back) quarters of 0% gains,” Lee said. “In fact, this has happened only one other time in the past 125 years, for either the Dow and the S&P 500.”

The last time this happened, it was the Dow that stood still for six months in 1904. But then something else happened: Stocks surged 43% over the next two quarters.

I love pocking holes in historic financial analysis when people have failed to do their homework. You can’t compare 1904 to 2015, but not for the reasons you might think. At that time we were in a totally different location within the 1899-1914 secular bear market. Today, we are at the end of this same cycle.

Meaning, the stock market is more likely to decline 43% here than to surge higher. Why? Because that’s what markets do at the end of their respective 17-18 year secular bear market cycles. Ex: 1913-1914, 1946-1949, 1981-1982 and 2015-2017.

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Did Our Secular Bear Market Terminate In 2009? Keep Dreaming Google

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Why Only A Fool Would Buy Stocks Here

Daily Chart Uly 27 InvestWithAlex

7/27/2015 – Another negative day with the Dow Jones down 128 points (-0.73%) and the Nasdaq down 49 points (-0.96%) 

I think I might have found a “100% sure bet” investment strategy. Just do the complete opposite of what Dennis Gartman is doing or saying. For instance……..

Seriously….which one is it Mr. Gartman? How can anyone make money by jumping between short-term extremes. At least for now the stock market is oversold and warrants some sort of a bounce. Will we get one? That is yet to be seen, but it would be smart to at least prepare for one. In other words, you might be a fool to go short here. 

On a more serious note, it appears the overall stock market is dying a slow death.

S&P 500 Propped Up by Just 2 Sectors Shows Bull Market Aging

More than 100 percent of this year’s increase in the Standard & Poor’s 500 Index is attributable to two sectors, health-care and retail. That’s the tightest clustering for an advancing year since at least 2000, data compiled by Bloomberg show.

We have been talking about exactly this for quite a while. And you don’t have to look further than NYSE (largest index by capitalization) to understand today’s market setup in its entirety. Here is what it is.

  • The NYSE hasn’t gone anywhere in over 13 months and is now down 3-4%.
  • That means the market is either building a massive base from which to start a multi-year bull run or it is distributing before a massive leg down.
  • Since Shiller’s P/E is at 27 (3rd highest level on record – right behind 1929 and 2000 tops) it is fairly easy to guess which way the market will break. .

Finally, with only a few highly speculative companies supporting the entire tech sector, it is not looking good. No QE, slowing earnings, interest rate hikes, no CAPEX, no liquidity etc….. I am having a very difficult time imagining what would save this market at this juncture. An outright miracle? Friendly aliens landing on the White House lawn? I honestly don’t know what that would be.

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. July 27th, 2015  InvestWithAlex.com

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

Why Only A Fool Would Buy Stocks Here Google