Tag: daily update

3/6/2015 – A big down day with the Dow Jones down 280 points (-1.54%) and the Nasdaq down 55 points (-1.11%)

I have been warning everyone since last week that low volatility at the time was coming to an end. We are starting to see the evidence of that this week. In fact, the stock market continues to perform exactly as forecasted (for our premium subscribers). If you would like to find out what happens next, please Click Here.  

In the meantime, big/smart money continues to warn investors. As I do.

Ray Dalio, billionaire investor and founder of Bridgewater Associates states,

“It’s the end of the supercycle. It’s the end of the great debt cycle. Central banks have largely lost their power to ease… We now have a situation in which we have largely no spreads and so as a result the transmission mechanism of monetary policy will be less effective. This is a big thing… So I worry on the downside ’cause the downside will come.

Let me put it this way. The only thing that stands between investors and an outright market collapse is misguided faith in the FED. In their ability to control the economy and markets. I wouldn’t want to be in that situation.

“Corporate debt was $3.5 trillion– in 2007, arguably a period and– many would describe as bubbly. It’s 7 trillion now. So it’s gone from 3.5 trillion to 7 trillion. As you know, most of that mix has been in more highly leveraged stuff, Covenant-Lite loans– high yield, that’s where the majority of the rise has been. And if you look at corporations have been using it for, it’s all financial engineering.” -Stan Druckenmiller

Again, this is scary. Borrowing money and then buying your own inflated stock in share buybacks to perpetuate the cycle of speculation is insanity. Yet, that is exactly what most corporates are doing today. In other words, this is just a legal way of getting a Ponzi Scheme going.  There is no other way to describe it. The consequences will be felt and seen as soon as the tide goes out.

“In the past 20 to 30 years, credit has grown to such an extreme globally that debt levels and the ability to service that debt are at risk, relative to the private investment world. Why doesn’t the debt supercycle keep expanding? Because there are limits. The implications are much lower growth, less inflation, lower interest rates, and less profit growth. We brought consumption forward and issued one giant credit card for the past 30 years. Now the bill is coming due. Investors need to get used to low returns, and low growth, inflation, and interest rates for a long time” – Bill Gross

BINGO. I couldn’t agree more. Yes, that probably means that you won’t see the Dow 20K or the S&P 2,500 for quite some time. Perhaps decades. Impossible? Here is a history lesson for you. Between 1897 and 1949, yes a 52 year period of time, the Dow compounded at less than 2% per year and below the rate of inflation. Don’t for a second think that this scenario cannot happen again.

“Notably, equities are not well supported by current valuations, while monetary policy is limited by high debt levels and interest rates that are already close to zero. We are now faced with a geopolitical situation as dangerous as any we have faced since World War II” – Lord Rothschild

Not only are our financial markets in a bubble territory, the current US Administration is hell bent on starting a war with Russia. As a result, invest accordingly.

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. 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 6th, 2015  InvestWithAlex.com

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Big/Smart Money Is Warning You About Upcoming Market Collapse. Are You Listening? Google

3/2/2015 – An up day with the Dow Jones up 153 points (+0.84%) and the Nasdaq up 45 points (+0.90%). 

The stock market continues to behave as forecasted. If you would like to find out what happens next, please Click Here. 

First, a brief history lesson. The last time the Nasdaq hit 5,000 was in March of 2000. It didn’t stay at that level for very long, a few trading days if I remember correctly. Once the blow off top was set, the index proceeded to collapse 75% in 2 years. Yeah, yeah……I know…..it’s different this time. At least according to the mainstream media, today’s valuation levels are supported by earning (an assumption that I have dismantled here quite a number of times).

With that in mind, 5000 is an important level not only from a psychological point of view, but from a technical one as well. Double tops of such big proportions are incredibly important as they often represent major turning points. Insiders tend to agree.

• Why the ‘Smart Money’ Is Bailing Out of the Bull Market
• Massive Insider Selling as Market Hits Record Highs

The first link deserves at least 5 minutes of your time. It presents a fairly good overview of the majority of the things I have covered here over the last few months. Insider selling, overvaluation, excessive bullishness, overbought indicators, speculation, debt fueled buybacks, slowing earnings, weak economic data, etc….

The only remaining question is…….will the Nasdaq break through 5,000 and keep going higher, an outcome most investors anticipate  – OR- will it test this double top, back off and then sell-off? If you have been reading my blog for any length of time, I think you know the answer to that questions.

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 2nd, 2015  InvestWithAlex.com

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NASDAQ Hits 5,000 As Insiders Accelerate Selling Google

2/27/2015- A down day with the Dow Jones down 81 points (-0.45%) and the Nasdaq down 24 points (-0.49%)

The stock market continues to perform as expected. If you would like to find out what happens next, please Click Here. 

Billionaire investor and hedge fund manager Crispin Odey, of Odey Asset Management, recently shared some food for thought.

• I think equity markets will get devastated. 
• Major economies are entering a recession that will be remembered in a hundred years. 
• Bearish opportunity to short stocks looks as great as it was in 2007-2009.

He goes on to say….

We are in the first stage of this downturn. It is too early to see what will happen – a change of this magnitude means the darkness and mist is very great. We will make some mistakes but with our thinking we won’t make the major mistakes. The problem is where you stand – I am amazed to see so many are fully invested given that equities are already fighting the downtrend. Mid and smallcaps have moved into bear markets and much relies on large caps to keep the whole thing going and they are very exposed to international trade.

I mostly agree with Mr. Odey’s economic assessment at this juncture. And while most people would label me as a “perma bear” I would have to disagree with the extent of his bearishness. I know….crazy. Here is why the decline of 2015-2017 will not be as great as the collapse of 2007-2009 and why it is certain that we will not see the crash of 1929-32 nor another great depression. At least for the time being.

This conclusion comes out of my mathematical and timing work. As I have said so many times before, we are now in the final stages of a secular bear market that started in January of 2000. The decline of 2007-2009 was a mid cycle panic. We had the same massive declines in all previous bear markets. For instance, 1907-1908, 1937 crash, 1973-1974.

What does that mean?

It simply means that final secular bear market declines of 1912-1914, 1946-1949 and 1981-1982 are never as violent as mid-cycle panics. That is to say, while the decline of 2015-2017 will be substantial, leading to big losses, it won’t be as violent nor as deep as the decline of 2007-2009.

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. February 27th, 2015  InvestWithAlex.com

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Billionaire Investor: The Best Shorting Opportunity Since 2007-09 Is NOW!!! Google

2/26/2015 – Another mixed day with the Dow Jones down 10 points (-0.06%) and the Nasdaq up 20 points (+0.42%) 

It is not often that someones comes out and calls like it is. Societe Generale’s notoriously bearish strategist, Albert Edwards, did just that.

The US recovery story is a fraud: SocGen bear

“The downturn in U.S. profits is accelerating and it is not just an energy or U.S. dollar phenomenon – a broad swathe of U.S. economic data has disappointed in February,”

I couldn’t agree more. We have covered this in great detail over the last few months. There is a massive disconnect, for now, between the real US Economy and the stock market.

“The reality is that the vast bulk of economic, as well as earnings, data (even outside the energy sector), has been simply dreadful. The economic cycle will be brought down by asset bubbles bursting long before ‘tight’ policy has any effect. Lessons were learned from the global financial crisis, but not that one.”

Last quarterly report is a perfect illustration on that. Corporates are guiding down in both revenue and earnings. All while the P/E ratios continues to expand due to speculation, buybacks, QE and accounting tricks.  If there was ever a recipe for a disaster, this is it.

“With equity markets galore hitting record highs clearly I must be missing something big!” he said. “I’ve been here before though and know full well how this story ends and it doesn’t involve me being detained in a mental health establishment (usually).”

I have been called all sorts of things in the early 2007 by various market participants. Boy who cried wolf, stupid idiot and my personal favorite, short selling a hole and unbeliever. Yet, the reality remains just as vivid today as it was back then. The stock market is in a massive bubble and it will eventually implode.

In other words, even Bernie Madoff must be amazed at how far the FED took our Ponzi driven economy. Most importantly, that 99.5% of people out there still believe them.

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. February 26th, 2015  InvestWithAlex.com

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Why Bernie Madoff Should Be Our Next FED Chairman  Google

2/25/2015 – A mixed day with the Dow Jones up 15 points (+0.08%) and the Nasdaq down 1 point (-0.02%). 

The stock market continues to perform as forecasted. About two weeks ago I have suggested that a period of low volatility is likely to occur. We are witnessing that today. With that in mind, don’t make the mistake of falling asleep here. According to my mathematical and timing work, volatility will be back with the vengeance shortly. If you would like to find out what happens next and when, please Click Here. 

In the meantime, Hillary Clinton paid $300,000 to explain what ails the middle class.  No surprise there as our future presidential candidate proceeded to blame new technology and male chauvinist culture for all of our economic problems.  The real answer, of course, is not as sexy……a massive Ponzi scheme perpetuated by the FED and the US Government. I told you it wouldn’t be as exciting.

Back to our attempt to illustrate just how out of touch with reality the stock market really is.

• Don’t kid yourself: Stocks are just as overvalued today as they were in 2000 
• I’m Not Trying To Scare You. I’m Trying To Help You

I have covered the points in the articles above at least a dozen times over the last few months, yet one persistent assumption remains. Most investors out there believe that today’s valuation levels are nowhere near Nasdaq 2000 levels. The articles above dispel some of that.

With that in mind, I am willing to take it even further. Not only are today’s valuation levels on par with Nasdaq 2000 levels, they are much higher. Here is why. The 10-year note was around 6% in March of 2000. It is at 2% today. If we are to plug 6% into today’s valuation models (not 2%), today’s valuation levels go from incredibly expensive to “the most expensive ever”.

Now, one can argue that we are comparing oranges to apples here. I would have to disagree. If we want to compare today’s valuation levels to 2000 levels, we have to use 2000’s discount rate. It is only then that we realize just how out of touch with reality today’s stock market is. That is to say, there is no way in hell this ends well. 

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. 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. February 25th, 2015  InvestWithAlex.com

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Why Today’s Stock Market Is More Expensive Than NASDAQ 2000 Bubble Google

2/23/2015 – Another mixed day with the Dow Jones down 24 points (-0.13%) and the Nasdaq up 5 points (+0.10%). 

The stock market continues to behave as forecasted. If you would like to find out when and where the market tops out next, please Click Here.

Two relevant views of the stock market in today’s daily update.

• A Stock Market Alarm Is Sounding for the First Time Since 2007
• The Fed is worried about what happens when everyone rushes for the exit

Despite recent higher highs, the market continues to flash a red warning light in various metrics. Today, lets take a quick look at margin debt. As the charts below suggest, long-term margin debt is at an all time high. Higher than at 2000 and 2007 tops. Short-term, margin debt has peaked last year and is now rolling over. That brings into question the validity of today’s rally and the ability of this market to push any higher.

On the flip side, this also raises the question if the liquidity can disappear overnight, just as it did back in 2008. Making the Fed very worried. From January’s FED Minutes.

“Finally, the increased role of bond and loan mutual funds, in conjunction with other factors, may have increased the risk that liquidity pressures could emerge in related markets if investor appetite for such assets wanes.”

Luckily, we do not have to guess here. We just have to look at the most recent sell-off in September-October of 2014. Despite a moderate decline of just 1,500 points on the Dow, the liquidity did dry up at that time. That is to say, should a larger 10-20% sell-off develop over the next few months, it would be wise to anticipate the liquidity to vanish and declines to accelerate. This does not bode well for the overall market.

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. 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. February 23rd, 2015  InvestWithAlex.com

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Why The FED Is Freaking Out  Google