“None of this means, however, that a business or stock is an intelligent purchase simply because it is unpopular; a contrarian approach is just as foolish as a follow-the-crowd strategy. What’s required is thinking rather than polling. Unfortunately, Bertrand Russell’s observation about life in general applies with unusual force in the financial world: “Most men would rather die than think. Many do.” – Warren Buffett
Marc Faber has been one of the most outspoken and well researched bears over the last couple of years. Predicting anything and everything from an outright collapse to a prolonged bear market. With that in mind, it appears that Mr. Faber has finally capitulated on his bearish stance….
“I’m an investor, and I invest,” he told CNBC. “Do I want to buy European sovereign bonds at a negative yield where I’m sure to lose some money — not a lot of money, but some money — or do I want to be in some blue chip stocks? If I take a 10-year view, I think I will make more money in blue chip stocks.”
Listen, being a bear in a bull market is one of the most difficult things out there. No matter how good your research is, you begin to question your sanity and everything else in between. I remember shorting sub-prime lenders in 2006 and then wondering how it was possible for them to still increase in value. For another 18 months. When they did finally collapse, in the summer of 2008, some of them went from $70-80 a share to penny stocks in a matter of weeks.
Point being, I believe Marc Faber is switching to the long side at the maximum pain threshold. He is tired of this bull market proving him wrong, he is tired of everyone in the financial media making fun of him and he is tired of losing money/opportunity. Yet, there is another way to look at this. When a bear like Marc Faber finally throws in the tower, it is highly probable that the market top almost there. If not there already.
March 14th, 2015: We have a great show for you this week. Hedge fund managers Matthew Demeter and Alex Dvorkin discuss the following topics….
Don’t miss this one and join us again next Saturday.
Listen to the podcast by clicking on the player above. If you prefer iTunes, please Click Here
3/13/2015 – A big down day with the Dow Jones down 146 points (-0.81%) points and the Nasdaq down 21 points (-0.44%).
Going into the end of February my subscribers knew that we were facing a major turning point at the Dow 18,320 (+/- 50 points) and that it would occur on February 27th (+/- 1 trading day). If you are wondering, yes, +/- 1 trading day included March 2nd.
My advice was also rather simple, to go short right at the top. The actual top arrived on March 2nd at the Dow 18,285. In the final analysis I have missed it by 15-35 Dow points or 0.08%. Close enough. Since then, the Dow is down -3.7% Are we about to bounce or is this sell-off just getting started? Click Here to find out.
So, how was I able to predict the exact top well in advance?
I use two primary analytic tools and none of them have anything to do with technical analysis, fundamental analysis, quant, Elliot Wave, the Dow theory or the such. My unique mathematical and timing work took me over 10 years of trial and error to develop and I am not even done. Further, it goes well beyond all of the tools mention above. Let me give you an example and its application to March 2nd.
1. Cyclical Composition Of The Stock Market.
There are at least 50 cycles moving within the stock market at any one time. From long-term cycles spanning 100 years or more to cycles oscillating with 4 minute Intraday periodicity. What we see on a 2-Dimensional Price/Time chart is a shadow of what is really going on behind the scenes.
What we see on the stock chart is the summation of all cycles into a singular composite. As per example above. What complicates the analysis is the fact that these cycles are not continuous. They shift and jump according to their own DNA sequence type of a mechanism. Meaning, it is a dynamic system that needs constant adjustment. However, once you know how these cycles behave and their order, you should be able to predict the stock market with astonishing accuracy.
Now, a number of incredibly important TIME cycles were arriving on February 27th (+/- 1 trading day). That meant the market was likely to top out at that TIME. The next question was….. WHERE?
2. Mathematical Stock Market Composition.
That is where my mathematical work comes in. As I have suggested previously, the stock market has a mathematical structure that it traces out behind the scenes. It is hidden , unless you know exactly what to look for. Again, the market traces out this structure in 3-Dimensional space. Once you know how to measure it, you should be able predict exactly where the next turning point is. I describe the whole process in great detail in my Timed Value book.
For instance, this same work indicated that a powerful point of force was located at the Dow 18,320 (+/- 50 points). In my subsequent communications to my subscribers I have indicated that the exact hit would be at 18,310 and that I would go 100% short at 18,300. The Dow topped out at 18,285 (15 points away) on March 2nd and I went short soon after. It was as simple as that.
Now, the more important question is, are we about to bounce or will this sell-off accelerate down. Click Here to find out. If would you like to learn more about the process I use, you can start with two free chapters from my book Timed Value
Long-term, my work 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. March 13th, 2015 InvestWithAlex.com
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A rather simple, but accurate look at today’s market environment. Unfortunately, the guy backtracks by suggesting we won’t see any sort of a decline in the equity prices over the next 12-18 months because the FED will not raise interest rates. Due to the strong dollar. In other words, continue to BUY (according to him).
I disagree. I won’t go into details, but my mathematical and timing work suggests that the FED will raise rates in June/July. Further, the dollar is topping out here and should reverse soon. This supports the FED case. And as soon as investors get this wake up call, expect rapid multiple contraction, just as described in the video below.
3/12/2015 – An up day with the Dow Jones up 259 points (1.47%) and the Nasdaq up 43 points (0.89%)
It has been my premise that the stock market has disconnected from any sort of economic reality a while ago. And while numerous Macro Economic indicators are literally collapsing, as covered here previously, the stock market is sitting near all time highs.
Earlier today Intel (INTC) slashed its Q1 revenue forecast by 7%. The bad old days may be back for Intel and other PC stalwarts Blaming it mostly on weaker demand and stronger dollar.
The change in revenue outlook is a result of weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain.The company believes the changes to demand and inventory patterns are caused by lower than expected Windows XP refresh in small and medium business and increasingly challenging macroeconomic and currency conditions, particularly in Europe.
Most financial pundits were quick to dismiss this lower guidance as a “one time event” limited to tech stalwarts. I, however, think there is a much bigger story there. I believe Intel is just the first large company to guide lower. Many more will follow.
Again, in addition to Macro data collapsing, the GDP expectations are also being adjusted down. By 20-50%, depending on the source. That is to say, it is just a matter of time before others start guiding lower as well. If not now, Q2 should do the trick. Once that realization sets in, it won’t be long before the stock market starts playing catch up with the fundamental data below.
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. March 12th, 2015 InvestWithAlex.com
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Intel (INTC) Guides Down. Are Others About To Follow? Google
“Acknowledge the complexity of the world and resist the impression that you easily understand it. People are too quick to accept conventional wisdom, because it sounds basically true and it tends to be reinforced by both their peers and opinion leaders, many of whome have never looked at whether the facts support the received wisdom. It’s a basic fact of life that many things “everybody knows” turn out to be wrong.”
― Jim Rogers
I firmly believe that the only people investors should be listening to right about now are the people who got 2000 and 2007 meltdowns right. Everyone else is just blowing smoke. Crispin Odey, the founder of London-based Odey Asset Management, is one of those people. He does not hold back….
“I just think that you and I have got grandstand seats here [to an imminent market shock] and my point is having found myself in the second quarter of last year selling a lot of equities and starting to go short, I found out just how illiquid it all was. You never actually see it until people try and get out of these things.”
That’s quite a powerful statement and I wholeheartedly agree. A lot of gold in this The Sydney Morning Herald article and it is definitely worth 5 minutes of your time. He goes on to say…
“For me, what I find very interesting is given the risk of recession, how is it the West stock market can be hitting all-time highs? History tends to be not very generous in this regard. If you get a recession in a low inflation environment it tends to impact the ratings of stocks dramatically. It was akin to “watching the markets take drunken bow after drunken bow. It’s amazing that nobody else is on the same page.”
The upcoming recession and the approaching stock market meltdown are so easy to see, I am not sure why the 99% go on missing it. The attitude was exactly the same at 2000 and 2007 tops. Greed or stupidity? I am not sure, but it is amazing indeed.
Top Hedge Fund Manager: No Liquidity, Stock Market Shock Is Imminent Google
3/11/2015 – Another down day with the Dow Jones down 26 points (-0.15%) and the Nasdaq down 10 points (-0.20%).
Over the last couple of years one investment strategy in particular worked like magic. If you were to buy every correction, you would have been greatly rewarded. In record time. It then comes as no surprise that today’s correction is viewed, by most market participants, in the very same fashion.
The question is…..should it be?
I would exercise extreme caution here. Here is why. In addition to the very well know fundamental issues such as bubble valuation levels and upcoming interest rate increases, we are also dealing with with excessively bullish mindset.
This is anecdotal, but I saw the same mindset at 2000 and 2007 tops. Just last night I had dinner with a big money manager who told me in no uncertain terms “We won’t see another 10-20% correction for as long as Obama is in office (I have no idea why). Plus, the FED will backstop every sell-off and that anyone who believes otherwise will lose money.”
Perhaps. At the same time, I would rather rely on actual data points and my mathematical/timing work. Not pie in the sky dreams perpetuated by the FED and 6 year of bull market. That is to say, when a bear market kicks in and does go through a 20% (or more) correction, 99% of the investors out there will be left behind holding the bag of HOPE. Just as before. Don’t be one of those people.
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. March 11th, 2015 InvestWithAlex.com
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