My guess is that eventually—and not far off—investors will figure out there is no recession coming and start to look at U.S. equities for a superior Dollar-denominated rate of return.
Don’t know if you are a chart watcher, but this never looked or felt to me like a stock market top.
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seems like over time the fed open market actions can “create” a recession to cool down or halt inflation whenever they want to.
for some reason? the fed hiked rates 7 times during trumps 1st two years in office while at the same time trump’s economic policies (paris, TPP, dereg, energy, jobs, etc) disrupted “the way we always do things” in the WW economy.
this slowed down many countries economic growth (coming off US largess) forcing their CB to ease.
lowering rates internationally made an US investment environment attractive.
eg. japanese could get 0% or negative rates investing at home or pick up 2-3% in safe haven UST Bonds. Yield chasers can pick up 100 - 200 bp more in other US blue chip equities thru here, which will bring money back into stocks, imo.
so what we’ve seen is fed forcing short rates up while at the same time investment demand from all over the world is pushing longer rates down.
this is an unusual set of circumstances & imo, not a traditional “inversion” of the yield curve since we’re not really fighting any inflation to add yield premium to long maturities.
add the tin foil hat, and this fed action could have been contrived to hurt the trump economy & hence his relection.
as far as charts, I do look in on them occasionally & I feel, absent some really stupid FF attempt, we have more upside in the market.
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The Fed has to reload for the next bailout of their friends.
Maybe it's no coincidence this follows Trump's policies and was never an issue during the Obama administration.
After all: Goldman Sachs et al. are heavily leveraged to the China trade and other Surrender-Trade deals.
We might suggest they were "Shorting America" and are about to get caught in the biggest short squeeze of all time as America's economy skyrockets vis a vis rest of the world.
Mixing metaphors: Trump's policies have got globalist Wall Street's tit caught in the wringer.
Will Soros stage a set of market shenanigans that will indicate a recession simply to tank Trump?