Rate and Review This Podcast on iTunesOverwhelming Evidence of a Weakening EconomyThe Dow Jones was the only one of the major indexes to close the day higher. The S&P was down slightly, we had larger declines in the Nasdaq and the Russell 2000. More importantly than the movements that we've just seen on the day, or even the week, look at what's ...…
Michael Wilson, the chief U.S. equity strategist at Morgan Stanley (MS - Free Report) , added that “over the past two months, the U.S. equity market has moved decidedly more defensive and value is showing more persistent performance versus growth.” This move toward defensive sectors and value strategies indicated that the market is concerned about growth fading later this year and next.
Swiss-born Marc Faber, now a resident in Thailand, holds a PhD in economics and is an investment advisor and fund manager through his firm, Marc Faber Ltd. He also writes a monthly investment newsletter, "The Gloom, Boom and Doom Report." As Money notes, Faber is consistently bearish, and frequently is called "Dr. Doom." He sees two big red flags right now.
Debt, my man, debt. In the rush to FIRE economy how could anything be better than DEBT? Particularly if you get the debtors to re-contract for that debt, and more, every so many months, resetting the terms of their interest payback to the beginning of the curve each time? As Ron said, this was all Monopoly money…that people agreed to pretend was real. The problem with speculation is that once you have more than a few people dancing atop the Milk the Suckers ponzi pyramid, it ceases to be a pyramid shape….
A bull market is the opposite of a bear market. It's when asset prices rise over time. "Bulls" are investors who buy assets because they believe the market will rise. "Bears" sell because they believe the market will drop over time. Whenever sentiment is "bullish," it's because there are more bulls than bears. When they overpower the bears, they create a new bull market. These two opposing forces are always at play in any asset class. In fact, a bull market will tend to peak, and seem like it will never end, right before a bear market is about to begin.
The Federal Reserve meeting last week, where the central bank raised interest rates for the fifth time in the last 15 months and signalled two more are on the way by the end of the year, should have breathed new life into the bears. Instead, bonds rallied, in part, as chairman Jerome Powell downplayed the risks of faster inflation and stocks tumbled. But, a close look at the Fed's rate forecast reveals that the difference between its call for a total of three increases this year and four amounted to one estimate on the central bank's "dot plot".