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Yo Canada, Your Real Estate Is Way Overpriced.

Canada-US-debt

In October of 2013 I did the unthinkable. I came out and stated that the US real estate market was topping out its “Dead Cat Bounce” leg and that the subsequent decline in real estate prices will make 2006-2010 decline look timid by comparison. You can see the full report here Real Estate Collapse 2.0 Why, How & When as my opinion hasn’t changed.  And while we haven’t seen substantial declines just YET, the market is rolling over as we speak. That is to say, the worst is yet to come.

And if you thought California real estate was expensive, just take a look north of the border. The situation in Canada is equivalent to the hottest markets in the US, with one primary difference. Canadian real estate was a late bloomer and their speculative cycle didn’t really get going until after 2002. Since their real estate cycle was about 8-10 years behind, they were not impacted by the real estate collapse in the US. Further, when the next round of financing (by the FED) showed up in 2008, Canadian Real Estate simply continued to accelerate as if nothing has happened.

Basically, Canadian real estate is where the US real estate was 9 years ago. The cycles confirm that as well. When this particular liquidity party ends (happening now) and the stock market shifts into the bear market, I would fully expect Canadian real estate to collapse. It is never different. Our friends at DoctorHousingBubble.com have a wonderful piece on Canadian real estate I encourage you to check it out. The Canadian housing bubble makes California real estate look sensible: Crash in energy prices will put pressure on home values up north as Canadians go into maximum leverage.

Plus, Garth Turner’s Blog “Greater Fool” is a great place to follow 

Z30

Yo Canada, Your Real Estate Is Way Overpriced. Google

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Will Stocks Surge In 2015…. Just As They Did In 1999?

Daily Chart January 2nd

1/2/2015 – A mixed day with the Dow Jones up 9 points (+0.06%) and the Nasdaq down 9 points (-0.20%). 

A great year for InvestWithAlex.com. We were able to beat the pants off the Dow and 95% of money and hedge fund managers out there. Delivering a risk averse gain of 19.80% Vs the Dow’s +8.17%.

In the meantime, the stock market continues to perform just as anticipated. That’s one of the reasons I shut down shop on December 23rd and took a well deserved break. Telling my subscribers that the market will not do anything until 2015 rolls around. If you would like to find out what happens next, please Click Here.

Now, during this down time so many “Bullish” articles came out that I almost blew a fuse. Almost. I am sure you have seen them, “The Secular Bull Market Is Just Starting, The Dow 20,000, Bears Will Get Run Over (what bears?), 2015 is Another 1999”, etc….. You get the picture.

The case for a bull market is fairly straight forward……..

  • Most technical indicators have turned positive.
  • The advance/decline line has turned up.
  • The number of new 52-week highs has been expending.
  • The Dow Theory continues to confirm a bull market.
  • Most markets are at an all time high.
  • Seasonality suggests that the bull market will continue.
  • Republicans will bring business back. Presidential cycle suggests up markets.
  • Oil prices are falling and that’s great for the overall economy.
  • Corporate earnings are great, unemployment is low, fundamentals are good, confidence is up, etc……
  • Oh and I almost forgot, everyone will get a Ferrari along with a massive tax return in early 2015.

In fact, if all of the facts above don’t make you want to pawn your left kidney and buy every stock under the sun, I don’t what will.

My response is………..so what? 

All of the above is already well know and discounted by the market. As I have suggested so many times before, the market moves according to its own mathematical points of force, not fundamental data. Consider the following. Most of the bullish points above were just as relevant on September 19th as they are today. Yet, the stock market proceeded to top out and then decline close to 10% in a matter 3 short weeks.

That is to say, don’t for a second believe that this market cannot decline here, despite all the bullish sentiment.  As a matter of fact, that is exactly when the market tend to “eat it”. Perhaps even faster than it bounced off of its October lows.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. 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 2014/15-2017 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 here. 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. January 2nd, 2014  InvestWithAlex.com

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

Will Stocks Surge In 2015…. Just As They Did In 1999? Google

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BlackRock: Most Of Corporate Earnings Growth Is Accounting Driven

s&p ratio

I have long argued that most of corporate earnings growth over the last five years came as a result of 3 primary drivers….

  1. Zero interest rates.
  2. QE.
  3. Share buyback

Making today’s stock market one of the most expensive ever. In net historical terms. Unbeknownst to me, I left another driver out. BlackRock brings it home.  BLACKROCK: Accounting Trickery Has Boosted S&P 500 Profits By 86% 

It becomes tempting to take on too much leverage, use financial wizardry to reward shareholders or even stretch accounting principles. S&P 500 profits are 86% higher than they would be if accounting standards of the national accounts were used, Pelham Smithers Associates notes. And the gap between the two measures is widening, the research firm finds.

In other words, it is not enough to borrow money at zero interest rates to institute share buybacks in order to drive earnings higher. By the way, the overall US economy now operates on the same principal. Companies must now stretch their accounting principals in order to show some sort of a earnings growth. Propelling today’s overall valuation and stock market levels from “crazy” to “it doesn’t matter anymore”.

Z31

BlackRock: Most Of Corporate Earnings Growth Is Accounting Driven Google

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What Do You Think About Buying Netflix Right Now – Daily Podcast

Visitor Question: What Do You Think About Buying Netflix Right Now?
Listen to our short 5-10 minute podcast to find out. Plus, don’t forget to email me your questions.
nflx

z33

What Do You Think About Buying Netflix Right Now – Daily Podcast Google

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Our Total Debt Cannot Possibly Be Repaid…Now What

total debt USA investwithalex

An important macro look at the state of total debt and its impact on our financial markets. It’s a quick read and I highly recommend it.  The World on the Verge of Another Financial Crisis.

Most people don’t comprehend that we are living in a protracted debt crisis with no possible solution, because the majority of money (about 98 per cent) in today’s economies in the U.S., the U.K., Canada and Europe is debt-money, primarily generated by private banks when they issue loans. The problem is that the sum total of these debts—which can never be repaid no matter how much the economy grows

I couldn’t agree more. The problem is, this debt has spread though every level and every sector of our economy. Including our financial markets. And there lies the problem. Over the last few decades this debt explosion has been used to propel our economy and markets higher. Unfortunately, the velocity of credit is now slowing down or non existent. With interest rates close to zero, there is very little the FED can do now. QE or not.

That means we are at a point of inflection. We either let this debt collapse and liquidate through a deflationary depression -OR- it will be inflated away. One thing is certain, whichever scenario plays out, it’s not going to be a pretty picture.

Z31

Our Total Debt Cannot Possibly Be Repaid…Now What Google

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No 10% Correction In 2015 Either. A Contrarian Bet.

daily chart ADecember22 2014

12/22/2014 – A positive day with the Dow Jones up 154 points (+0.87%)  and the Nasdaq up 16 points (+0.34%). 

It’s no secret that today’s stock market and valuation levels have long ago detached from any sort of fundamental reality. Thanks to the FED, zero interest rates, QE and margin driven speculative fever.

With that in mind, when financial media claims that every sell-off is quickly recovered, the days of 10% are behind us and that a 10% correction is now a contrarian view, you know that they have “jumped the shark”. The 10% stock market correction you never notice.

On a second thought, perhaps they are right. Maybe you should go out and buy every stock under the sun. Better yet, why don’t you mortgage your house, pawn your left kidney, max out your margin and buy every out of money call option you see. After all, it’s a sure bet. Just as it was in January of 2000 and October of 2007.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. 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 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: 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. December 22nd, 2014 InvestWithAlex.com

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

No 10% Correction In 2015 Either. A Contrarian Bet. Google

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The US Economy Is Doing Great. Why Are You So Bearish? – Daily Podcast

Visitor Question: It appears both the US Economy and the stock market are doing very well. Why are you so bearish? 
Listen to our short 5-10 minute podcast to find out. Plus, don’t forget to email me your questions.

z33

The US Economy Is Doing Great. Why Are You So Bearish? – Daily Podcast Google

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Investment Wisdom Of The Day

wall street monkeyRaven, a 6 year old chimpanzee, became the 22nd most successful money manager in the USA by throwing darts at a list of internet companies. Raven created her own index, dubbed MonkeyDex, and in 1999 delivered a 213% gain, outperforming more than 6,000 professional brokers on Wall Street.

z32

Investment Wisdom Of The Day  Google