Posted on 06/12/2021 7:37:41 AM PDT by BenLurkin
1. Historically high valuations are bad news
To begin with, the widely followed S&P 500 is pricey...really pricey. As of the close on June 7, 2021, the Shiller price-to-earnings (P/E) ratio for the S&P 500 hit 37.5. The Shiller P/E, also known as the cyclically adjusted P/E (CAPE) ratio, is based on inflation-adjusted earnings from the previous 10 years. This reading of 37.5 is well over double the average Shiller P/E ratio of 16.8, which dates back 151 years.
2. History says we're in trouble
Looking back 61 years, there have been nine bear markets. In the previous eight bear markets...there were either one or two double-digit percentage declines within three years following the bottom. In aggregate, we're talking about 13 double-digit drops spanning the three years following these eight bear-market bottoms.
3. Crashes and corrections happen frequently
According the market analytics company Yardeni Research, there have been 38 separate instances since the beginning of 1950 in which the S&P 500 has retraced by at least 10%. Put another way, we observe an official correction or crash in the benchmark index, on average, every 1.87 years.
4. The Federal Reserve can't remain dovish forever
One reason equities have rallied so ferociously off of the March 2020 bottom is the amount of support they've received from the nation's central bank. The Federal Reserve has stood pat on historically low lending rates and continued with its monthly bond-buying program that's designed to weigh down long-term yields.
5. Margin debt is skyrocketing
Perhaps the most terrifying fact of all is the current level of margin debt. Margin is the debt that brokerage customers take on to buy equities. Consider it a way to leverage their gains, as well as their losses, if they're incorrect about which way a stock will move.
(Excerpt) Read more at fool.com ...
I’m getting ready to liquidate a Menus fund next week. The market likely will crash.
Democrats in office, has to happen
I love the doom and groomers, they’re always right — markets eventually crash or go down. However over time, the DOW has always trended UP, with a bunch of dips along the way. I started in the 70s when it was in the 700s. Haven’t lost a penny at any downturn because I never sold in a panic.
A correction here is good news for long term investors.
Here’s the other 5 reasons:
1. Joe Biden
2. Joe Biden
3. Joe Biden
4. Joe Biden
5. Joe Biden
I saw a great parade here yesterday in New York of people holding up Trump flags, Trump signs that said “I voted for Trump, don’t blame me” LOL I gotta get me one of those as it’s only going to get worse.
IMHO, it’s point #4 that matters the most. The stock market is the only place to be when bank accounts are paying 0.1% and CDs are paying 1%. But should the Fed start aggressively raising rates, that will all change.
Yep.
Hey, I’m getting 0.2%.
If one has a million should he or she bail? It happens no matter who is in office but under the democrats recovery takes longer-just like covid.
1. Big govt retirements
2. Trading collars
Rigged.
❎
unchecked "progressive" control of Biden
6) Taking down Central Banksters and Fractional-Reserve financial system, to pave the way for Precious-metals-backed NESARA/GESARA/QFS.
They keep pumping up the market with fiat money. It may never crash but the value is reduced by inflation.
Nice handle...
And...
1. Main street is hurting
2. Nobody wants to work, much less work hard
3. Employers have to hire the right person based on other criteria than best qualified
4. Looks like a war is coming somewhere soon
5. If Biden dies or resigns due to health problems you have an even more incompetent successor
6. Power grid is over tasked, old and faces environmental challenges.
Come on baby, CRASH!
For reasons out of my control, I’m sitting on >60% cash.
Just waiting for the rout.
Millie-What’s wrong with bonds/treasury bills?
Democrats in office, has to happen.
Actually most crashes during the 20th and 21st centuries have occurred during the terms of Republican presidents:
1907 Panic - Theodore Roosevelt
1929 crash - Herbert Hoover
1987 crash - Ronald Reagan
2000-2001 - Both Bill Clinton and G.W. Bush administrations presided over the Dot-Com bubble burst.
2008 Financial Crash - G.W. Bush
2020 Covid Crash - Donald J. Trump
The 2000-2001 Dot-Com bubble burst began in the Clinton Administration so it is the exception.
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