7/6/2015 – A down day with the Dow Jones down 44 points (-0.25%) and the Nasdaq down 17 points (-0.34%).
A massive and rather rapid stock market decline is coming later on this year. And while we won’t have a crash, considering the amount of margin debt out there, quite a few people will get wiped out. If you would like to find out exactly when this move will develop, to the day, please Click Here.
What is the worst case scenario for the FED?
Imagine the following setup.
- Interest rates remain at zero or below 1%.
- The stock marker rolls over and initiates a decline. A decline that has the capability of turning into a flash crash later in the year.
- The US Economy “officially” goes negative as corporate earnings collapse.
- The FED introduces QE 4 to stabilize the market/economy.
- Bond market reacts in a negative fashion as yields surge.
- Negative self sustaining loop is now in place.
- Checkmate and game over!!!
Impossible?
Far from it. I would argue that points 1-4 are already baked in and will fire off over the next 6-12 months. The only thing I am not as confident about is the bond market. In such a case, yields can react in either direction and it is a little bit more difficult to predict at this time.
That is to say, the FED has already missed their opportunity to reload. When the next crisis hits, soon, there is very little that the FED will be able to do. Well, they will be able to watch the market meltdown, but they won’t be able to do anything about it. I am afraid that their nightmare is about to become a reality.
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 1st, 2015 InvestWithAlex.com
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The Worst Case Scenario For The FED Is Becoming A Reality Google