7/23/2015 – Another negative day with the Dow Jones down 119 points (-0.69%) and the Nasdaq down 25 points (-0.49%).
To be hones, I have no idea. Everyone I know, money manager or individual investors, are extremely bullish. And despite numerous bearish divergences or sentiment indicators, the market is sitting a stone throws away from all time highs. Did you see the rally off of July 8th bottom? The Nasdaq just put in a new top. Still, some people don’t get it.
Big-name investors stand atop a welcome ‘wall of worry’
Ray Dalio’s Bridgewater Associates, is on the front page of the markets’ newspaper of record turning negative on Chinese stocks, saying there is “no safe place” for clients’ money there. This alarmed – and alarming – message comes mere days after the brilliant billionaire investor Carl Icahn told us all that junk-bond ETFs were a disaster-in-waiting – tinderbox theaters just waiting to ignite and trap their customers.
Earth to bulls, there is no wall of worry. I hope the author realizes that he is talking about Mr. Icahn and Mr. Dalio, not some Joe off the street. This is utter nonsense.
You really want to know why the “smart money” is starting to ring the warning bell?
Wall of worry or not, they clearly understand that the drivers that took this market to bubble level valuations are going away.
For instance, The stock market is disappearing
And as we noted on Tuesday, net flows into US stocks have been relatively flat since 2006, while net issuance, or the amount of new stocks being introduced onto the market, has plummeted. This math, then, indicates that the most recent bull market has been all about reduced share counts.
QE gone. Stock buybacks are slowing down and going away. The Fed is about to increase interest rates. Credit expansion cycle is over and CAPEX is dead in the water. Corporate earnings are slowing down, Apple watches are not selling and “unofficial” economic data points to a severe recession.
Call me stupid, but I don’t see what will drive the stock market up this proposed “wall of worry”. Wall of Jericho might be a better definition here.
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 23rd, 2015 InvestWithAlex.com
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