Skip to comments.THE NEXT STOCK MARKET CRASH: Why Many Pros Think It Has Already Begun
Posted on 02/27/2013 6:27:54 AM PST by blam
THE NEXT STOCK MARKET CRASH: Why Many Pros Think It Has Already Begun
February 27, 2013
Stocks are near all-time highs. And there are plenty of reasons to be terrified...
After coming within points of an all-time high, stocks have begun to stumble, and volatility appears to be returning to the markets.
This has led some market pros to declare that an amazing four-year rally in stocks is over and that we're on the precipice of a new crash.
And there is certainly no shortage of logic to support that view.
Massive U.S. federal budget cuts are looming, political instability in Europe is returning, and currency values around the world are falling.
And by many measures, U.S. stocks look due for a comeuppance. Valuations are elevated, profit margins are at all-time highs, and there are signs of investor complacency everywhere.
Of course, not everyone thinks stocks are headed for a crash. In fact, some experts think we're at the beginning of a new long-term bull market and that investors should go "all-in." But we'll focus on those folks later.
For now... (Click to the site for numerous charts)
(Excerpt) Read more at businessinsider.com ...
the stock market is very high, but words like “terrified” “crash” “looming” and “precipice” show that this piece was written by someone who is not serious.
Not to worry. Obama will print up billions more in monopoly money to further ‘stimulate ‘ something or other and that cash will fuel the market to higher albeit more worthless numbers.
“Revised December Data
Revised seasonally adjusted December figures for all manufacturing industries were: new orders, $483.4 billion (revised from $484.8 billion); shipments, $483.4 billion (revised from $484.9 billion); unfilled orders, $991.3 billion (revised from $991.7 billion); and total inventories, $614.9 billion (revised from $615.5 billion).”
All revised DOWN, so doesn’t that skew the numbers for January? Unexpected! *DRINK* :)
I wonder if my prediction of people/companies buying things to hold value during the coming inflation is coming true?
I expect PM prices to lead the rise. Then RE, farmland, productive enterprises, vehicles, capital equipment, etc. will be used as inflation hedges.
The smart investors may be borrowing and leveraging with the plan of paying back the loans with inflated fiat.
The Fed Reserve is pouring money into the stock market....if they were not doing so the stock market would be about 6000 to 7500. Not 13,000 to 14,000.
They simply will not allow it to fall to the proper levels lest Obunghole look bad for his ineptness
“Drink, drank, drunk, game” for “unexpected” ?
You are, of course, correct. The Fed’s actions are highly illogical. Hence my point.
My question regarding the protection racket surrounding this president, as we have seen for no other in the history of the nation, is why?
So where do we find a one-handed prognosticator?
But... it’s all self-evident the Fed is juicing the market. Pure market manipulation. Funny, how the SEC/NAZ goes after large institutions for moving the market & gives a pass to the FED.
He’s the Antichrist or the precursor thereof?
Just a guess.
The fed is printing money and buying stocks with it to prop up the market.
They’ll turn the lights out on folks soon enough.
I’m drunk by 8am every day now, LOL!
wasn’t there an article on TBI just last week or the week before by another writer claiming that the Dow’s rise to 20,000 is inevitable?
Market prices reflect an emotional response to practical indicators.
This practical indicator along with the purchasing managers index are particularly good.
However, emotion may rule again; but it will fail against results.
Love your tagline, did you know that?
Morgan Stanley on the Durable Goods report:
* Mixed report. Overall durable goods orders plummeted 5.2% in January after a 3.7% gain in December, on a sharp reversal of a surge in defense capital goods (-69.5% v. +107.3%) and a pullback in civilian aircraft (-34.0%). Outside of these two volatile categories, however, nondefense capital goods ex aircraft orders, the key core gauge, surged 6.3%, extending a solid recovery in recent
months from substantial weakness seen through most of last year as policy uncertainty and global growth uncertainty was mounting. This points to improving capital spending growth going forward, but in the near term a 1.0% drop in nondefense capital goods ex aircraft shipments in January pointed to weaker investment. We now see Q1 GDP growth tracking at +1.6% instead of +1.8%.
* The sharp gain in core capital goods orders in January left them up 12.8% in the past four months, more than reversing a 10.0% pullback in the first nine months of last year. A 13.5% gain in machinery orders accounted for the January jump, while orders of high tech equipment were down sharply in a continued failure to show much of any improvement since the recession lows.
* The 6.3% jump in core capital goods orders combined with the 1.0% drop in shipments left unfilled orders for nondefense capital goods ex aircraft up 1.6% after a run of seven straight declines. This points to better capital goods shipments in coming months, but even building in a strong rebound in the near term, the 1.0% drop in January shipments points to a sluggish outlook for Q1 investment.
We now see equipment and software investment rising 2.0% in Q1 instead of 3.1% and overall business investment (with a modest gain expected also in structures) 2.2% instead of 3.1%. Going forward, however, the level of net business investment relative to overall GDP ended 2012 at what we view as still an unsustainably low level, and the turn higher in core orders and unfilled orders was in line with our forecast that investment growth will accelerate over the course of this year and into 2014 as fiscal policy uncertainty diminishes.
I see it this way: Either it will break through the barrier, fueled by inflation, or it will crash again.
You can bank on it! ;-)
LOL, for the pros out there. Hype the results so one can get in or out. Keep an eye on the “short” volume. I’ve always wondered about front runners sreaming, “Extra, Extra.. read all about it”
“The dow rise to 20,000 is inevitablle”
Well it is. But over what time horizon?
Former Fox News guest Gerald Celene kept saying the economy would crash very five minutes. The problem was he kept trying to put a date on things. And that is why he was let go, nothing occurred when he predicted. His Trends Research company was too inaccurate. So while it will happen, I wouldn’t put dates on things.
So many have scales on their eyes.
I would also say the crash will be slow and not as immediate as some people think. Therefore, nobody is sure how it will go. The SHTF Plan site has a bunch of scenarios they post on YouTube videos. It will take me some time to find the links as it was last summer.
Well, in the sense that if you buy today at Dow 14K and sell in 25 years at Dow 100K, this is probably true. If you find yourself in a financial position where you are forced to sell in 2017 at Dow 5K, you might have a very different opinion...
Having said that I highly doubt if the "three steps and a stumble" rule will apply this next time. Once the Fed starts it will probably be ugly FAST.
market manipulation yes, but not pure market manipulation. They have other objectives, that they believe will be fostered by pursuing this policy for a while longer, and that they think they can end without destroying the world again.
Are they right? I am agnostic to skeptical, and (pretty uncomfortably heavily in cash)
I have been hearing this for over three years. My portfolio is up 32% in that time. Maybe I will listen to the doomsayers this year maybe not. When you are well prepped you can afford to take some risks.
May have already begun, but as we have seen an uncountable number of times in the past couple of years, stocks and markets can remain high (i.e. are deliberately kept high) far longer than any economic laws can explain. Bears could be calling every day a top well into May.
Good for another 500+ on the DOW.
Well don’t be preaching your tee-totaling to us market watchers here in CA where the stock markets open at 6:30. :-)
If you’re playing with “house money”, why not?
The only problem would be a “bank holiday” where they don’t allow you to sell, they just close the market.
So, it is either going up or going down.
A bold prediction my friend! :o)
Saw it in a t-shirt - but it’s so ME, I couldn’t resist. :)
I won’t! We all need SOME form of escape from this madness!
huh? Who’s picking up the Fed money, the dumb money or smart money? Pure manipuation from one source, whether calling it juice or sugar coated & there’s plenty of smoke & mirrors going on in the world’s largest casino!
As far as in you being in cash, I get annoyed with the Institutional players (ie Fund Managers) sitting on any amount above 5% cash. Cash makes NO money resting in this market. Unless, you are a senior & have all your money off he table & had your fun transferring wealth.
Hey I’m not telling you to drink, I’m saying I’m two hours ahead of you, especially on days like yesterday. :-)
Nine-hour bear markets, bah.
Are you kidding? The stock market is totally controlled, manipulated and propped up...One has to be an idiot to hand their money over to Wall Street.
I’m not sure I understand what you’re saying, and I’m almost positive you didn’t understand what I was saying, so let’s just let it lie.
I recommend reading lessons.
I said it was market manipulation, by the Fed.
And that I don’t have much money in the market.
It’s not at all clear to me on what point we are in disagreement, and why I therefore must be “kidding.”
And I stand behind it.
Wall St. is sending a message to Uncle Ben, “yeah, that $90 billion a month you been giving us to pump up the market, you need to double that.”
It seems to me that people with lots of cash (not me) only have a few choices: invest in gold or other metals; let it rot in a money market fund with a microscopic interest rate; stuff a mattress; or buy stocks. I think the low interest rates and undesirable bond markets are inflating the price of stocks. If interest rates went up to a point where an investor could gain 6 or 7 percent a year, stocks would look less appealing and the marked would be lower.
I don’t see how the stock market can crash when it is being supported with FED Reserve money. It is not like the FED Reserve is going to withdraw their money and crash it.