Posted on 06/01/2013 4:07:40 PM PDT by Publius804
It may be days, weeks, months or even years away, but inevitably the stock market—which has more than doubled over the past four years and hit new record highs this year—will descend, as many analysts warn and as history has shown.
How big that drop will be and how long it will last are open to debate. In fact, a large number of analysts contend that the bull market still has plenty of pep, which would mean that you don’t have to take extreme defensive steps for a while.
But even so, it’s important to think about your own financial situation and how it could be affected by an extended pullback, especially because the traditional strategy of shifting toward bonds or bond funds may not work as well this time as in the past. Interest rates are so low that they could surge—hurting bond prices badly. That could happen in the next few years as the economy strengthens and the unemployment rate drops.
Bottom Line/Personal asked four top market strategists to each describe his/her favorite way (in one case, a radical approach and, in others, a more moderate approach) to start preparing so that you can cushion your portfolio once a stock market pullback begins…
(Excerpt) Read more at bottomlinepublications.com ...
Geez! I could say the same about death as well.
The market is a reflection of investor confidence, and right now there’s no other place to invest and make a return. That’s not likely to change unless something change the level of confidence.
If one is nimble buy FAZ or TZA on the way down. These are 3x Bear stocks which can pay off handsomely if there is a severe drop in the market. Be sure to stay glued to the monitor if you follow this though because if the market goes back up, you will lose more than you want to think about. Sell at the bottom if you can. Gold and Silver will probably rise during a panic sell-off.
Ping for review.
I still think Real Estate is a lucrative alternative to the obammy market. Rental property (if you have the appropriate skill set to manage effectively)..... and selling property but providing the financing. These make predictable income and real estate prices are still depressed to a degree.
” Geez! I could say the same about death as well.”
And you would be correct. I believe to sit by paralyzed because something might happen is a waste of time. If you believe something Will happen fine but to be afraid of what could happen is sad.
So sure, there has to be a correction when the ptb decide to do their profit-taking thing again, when they're convinced the little folk have their money back in as much as they will.
I've still got a little money in stocks, in pretty good small companies that didn't reach their potential because of the recession. I can't decide whether to sell them or to hold on, hoping someone buys them out.
What nonsense. The stock market is at new permanently high plateau.
“The market is a reflection of investor confidence,”
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How can an INVESTOR have confidence when the USA is being turned into a Marxist hellhole.
I say the market is phony, and being run by fat cats doing the pump and dump.
This is not your father’s market.
The Feds funny money is pumping up the Stock Market and Housing. When the Fed announced 85B/a month QE forever, I also got back in the market. This was a no-brainer.
Will it last - No its another bubble. These policies are really punishing savers and the middle class.
Our economy like so much of our society is based on smoke and mirrors.
So after the Stock Market crashes - where does the author recommend investing.
Well don't laugh. This is serious. Do you realize that over 70% of the people alive today on the planet earth will be dead in 60 Years?
Congress needs to write a law...
Rental units. Real estate. I’m back being a landlord after many years away from the game. Not thrilled about it, but people need to live somewhere & my rental properties are in very good areas. Rents are sky-high in my area. My 2 units can pull in close to 80k a year.
This may be true, but it’s not obvious.
It seems to me that when the government prints money, non-dollar assets increase in value as the value of the dollar decreases in value...
That's it right there.
The S&P 500 dividend yield is more than 2%. A one-year CD is paying less than half of that. And savings accounts are paying essentially nothing.
IMHO, absent some sort of shock to the system (war, etc.), the stock market will continue to do well...up to when rates start to rise. Then look out below.
Of course, that event might be some time away. The Fed has a lot of incentive to keep rates low and the party going.
By the way, I'm not saying that everyone should jump in now. The easy money has already been made. What I am aluding to is that old saying: "When rates are low, stocks will grow. When rates are high, stocks will die."
The stock market is like Vegas without the floor shows and free drinks.
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This short article is a great and simple capsulation of what’s happening.. but few seem to be paying attention.
Headed Toward a Brick Wall
Written by Bill Holter | May 15 2013
The global economy(s) has decidedly slowed down everywhere you look and at best is treading water. The GDP calculations of course are bolstered by trillions of dollars of new debt so without the “debt growth” we would be in full-fledged depression. Yet, stock markets nearly everywhere are ebullient and making either all time or multi year highs. A disconnect for sure, but is explained because of central bank easy money. Some have even looked at this phenomenon (myself included) and concluded that rising stock markets are a result of easy monetary policy… which hasn’t/won’t kick start the real economies. This is a classic sign that hyperinflation is in the cards. This conclusion is based not on opinion, but on history.
The current situation sees stock markets making new highs, interest rates historically and unjustifiably low, central bank and treasury balance sheets bloated and exponentially expanding… and yes of course “pressure” on paper precious metal prices. If you break this “combo” of pricing down into its parts, something (many/all things) doesn’t make sense. First, if “easy money” has not worked in the 5 years since 2008, why will it work now? If easy money (designed to create inflation and thus avoid deflation) is “good” for stocks because of the inflationary implications… then how do zero percent interest rates make sense if inflation will rise? Who in their right mind would tie up capital at very low fixed rates if they know that inflation will rise? And of course, how does easy money mean anything “bad” to real monies, gold and silver?
What we have here is a bubble. In fact we have a series of bubbles. The world is sitting on more bubbles, bigger bubbles than ever before. If you added together ALL of the bubbles (South Sea, Tulip, 1929, Japan 1980′s, Oil a couple of times, etc. …ALL of them prior) in the history of mankind, they would be a percentage, a VERY small percentage of the bubble(s) we have blown and are living with today. The central banks of course don’t see them (liars, liars pantalones on fire) because they ARE the bubble (or a big part if you don’t include the $1.4 quadrillion derivatives market)!
My point is this; every market is going in the wrong direction in preparation for what is coming. Yes I know, this is always how it works when bubble are being blown. Money is pouring into bonds in particular, stocks are being propped up and margin balances swollen, people are also being prodded into “selling” their gold (paper obligations). As I see it, we are headed directly into a brick wall where everything just stops. “Just stops” as in all markets are closed and you have what you have which will either be marked up… or down on the day that the music starts again.
You can argue many things, what you cannot argue is that the world, including and especially sovereign treasuries, are heavily indebted (more so now than ever in history) while at the same time their central banks increase the size of their balance sheets (print) unlike ever before. In what world does it make any sense at all to own the debt of a bankrupt debtor? In what world does it make sense to hold the currency issued from a central bank that openly admits to monetizing? In what world does it make any sense at all to participate in a Ponzi scheme AFTER the promoters have already spelled out exactly what it is? It doesn’t, but no one (very few) will see this until after the fact. After the markets are closed, after the “bail ins” occur, after currencies don’t and won’t spend.
Yes I know, some (probably many) will say that I’m nuts and none of this will ever happen. I would say that it has ALWAYS happened, ALWAYS. History is rife with examples. Examples of bank runs, examples of hyperinflations, examples of asset bubble and examples of governments that could not “pay their bill” because they borrowed too much. These examples were scattered throughout time and geographical location. Now it is everywhere and all at the same time… so why will “now” be any different from all of the previous historical examples? It won’t be, it will only be worse, affect many more and be concentrated into one hideous financial and societal event all at one time.
So, the crowd is pouring into bonds, stocks, real estate and counting their values in “chits” of colored paper. They are doing this with the “push” from sovereign administrations, central banks, financial institutions and the media. People are also looking toward an exit door with a sign over it that says “scary, SCARY… do not go here” placed there by the above collection. The “brick wall” is out there. You can say that it isn’t but history, math, logic and just plain 3rd grade common sense says that it is.
Think this one through, it’s not hard but life after “the wall” will be!
No, not really, but can’t earn interest anywhere else.
YES!!! are you?
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