8/1/2014 – A down day with the Dow Jones down 70 points (-0.42%) and the Nasdaq down 17 points (-0.39%).
The market continues to perform as per our internal forecasts……yada, yada, yada. When I parked a lot of my assets in the 10-Year Note on January 2nd of this year at 3% a lot of people thought that it was the stupidest investment decision yet. After all, the US Economy was supposed to catch on fire and the FED was tightening. Higher rates were a given. At least that’s what everyone else thought.
Thus far this year, with the Dow now in the negative, the 10-Year Note at 2.5% has proven to be one of the best investments out there. And while most investors continue to see this as a fluke, the best is yet to come. Bill Gross tends to agree…PIMCO’s Bill Gross names ‘the only safe haven’ in this market
Here is why yields will continue to decline and the yield curve will flatten further.
- The bond market is starting to see a severe recession and a bear market within the US Economy. Our mathematical and timing work confirms the same. Showing a significant recession and a bear market between 2014-2017.
- Typically, 30-year bear markets in yield do not end in a V shape form. When such long moves complete they often set a secondary bottom (at least). This fits well within our overall economic forecast as we anticipate yields to set a secondary bottom over the next 2-3 years. In 2016 to be exact.
- There are a number of open gaps leading all the way down to 1.5-1.6% on a 10-Year Note. Again, it is highly probable yields will go there over the next 2-3 years.
When we put all of this together, it becomes evident that the US Economy and the US Stock Market are in real trouble going forward.
This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. 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. August 1st, 2014 InvestWithAlex.com
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