Posted on 08/27/2014 9:16:01 AM PDT by Citizen Zed
The Fed's low interest rates could bring a "scary" 50-60 percent market correction, technical analyst Abigail Doolittle told CNBC on Wednesday.
"Unfortunately, I think it could come on a crash similar to what happened in 2007," the founder of Peak Theories Research said on " Squawk Box " a day after the S&P 500 closed above the 2,000 level for the first time ever. "It's tough to know what the exact catalyst will be. But that's the very nature of that kind of selloff. They start slowly and then happen very suddenly."
Doolittle pointed to a 20-year chart of the Dow Jones Industrial Average. "When we take the long-term chart of the Dow ... we see that it's trading in a multiyear trading range, hitting up on resistance.
What makes this so important [is] you can see that the entire bull market trend over the past five years has started to reverse.
(Excerpt) Read more at mob.cnbc.com ...
You’re ill-informed and delusional if you think the market is where it is because of “earnings”.
Ok what I think is appropriate is cashing in this entire account ($40k or so), and buying silver, and BURYING IT SOMEWHERE...what are you going to do, if you don’t mind me asking?
Bkmk
Okay here is what she is talking about;
20 years is WAY to long of a horizon for decent technical analysis.
One of the things you want to look at is recent trends and support/resistance levels. here is the 10 year chart with lines drawn since the bottom in March 2009. From this it seems there is significant support a little above 16,000.
We can move in even more recently to see other support/resistance levels. Here is the 2 year chart that shows plenty of running room until we hit resistance over 18,000
How would that happen?
I realize people have lost everything because they trusted brokers or they were in a fund that went defunct. I thought the cash portion of my individual brokerage account is about as safe as it gets.
It's a money market fund, right?
It's not FDIC insured, not that FDIC will be able to cover very much once the "bank holidays" start.
I’ve been reading articles like this on a weekly basis since 2009.
You believe that record high business conditions are responsible for that? Really? Then I recommend you go full Democrat in your voting preferences. OTOH, if you accept that an artificial and unsustainable la-la business environment created by central bank intervention (worldwide) is responsible, drop the argument and admit it's a fed bubble. Earnings aside, profits are not driving this market, free money to speculate is.
Ahhh the typical “then go vote democrat” retort. LMFAO.
Corporate buybacks another big reason for the lift in stocks. Not sustainable.
It is. It isn't very much money.
You make a good point. If the brokerage firms wanted our money to be safe, they'd have the option of holding it in an FDIC insured bank account. Tomorrow I'm going to try to find out if they have that option.
There is no good answer. Short-term treasury bonds seem the best, but most brokerages only have treasury funds, not the option of actually owning the bonds themselves.
Over the long run buy backs are of little value to the market and shareholders. They are an enormous waste of capital.
Foreign stocks?
Peter Schiff invests a lot of his clients money in foreign stocks.
I recently heard him say something along the lines that he looks for stocks in countries that have sounder currency, a less restrictive regulatory environment and more liberty than is found in the USA.
I found that to be a depressing statement. The USA was once the world leader in all of those things, which is why we were once the global economic powerhouse.
This topic was posted . Thanks Citizen Zed.
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