Great video – I’d add that a big part of inflation today is supply chain related to world wide Covid labor shortages. The stock market didn’t take off in the 1920’s until the Spanish Flu pandemic ended. I think that’s the difference between the 1920-1940’s charts and today, we are still in a pandemic.
Definitely partly due to labor shortages. Although one could argue that the labor shortages are partly caused by the pent-up demand from stimulus (not just the pandemic).
FED is definitely backed in a corner here with roaring inflation but with economic growth that was capped by a « never-ending » pandemic.
Seeing recent economic data and rising yields on the shorter end of the curve, it’s very possible we see the FED backtracking on their hawkish tone in the next few weeks despite elevated inflation rates. The equity markets will very like « sniff this out » before any sort of FED announcement.
I have to take the contrarian view once more on this. I agree labor shortages have played some roll in supply chain disruption, which as a result has contributed to inflation; however, I still believe the FED is behind it all. The FED created the inflation on purpose to change the monetary system in the future. The FEDS’ 2 mandates are price stability and job creation. They have miserably failed at both. Why would we have a labor shortage if the FED did their job and ensured job growth? And don’t anyone site Covid! That was the cover. They could have stopped inflation at any time over the past year by raising rates (when they should have) and reducing asset purchases. But what did they do instead? Continue reducing rates and increasing asset purchases……massively inflationary. But now they are trying to be the saviors by reversing policy? It’s too little too late and will not work. Once again IMO if they raise rates it will be minuscule and change nothing. There is no digging out of the hole this time without a financial reset, which is coming.
And arguing that labor shortages are partly caused by pent-up demand from stimulus? The last stimulus send out to the average citizen was over 6 months ago. That money is long and gone. It is already in the system or in the pockets of the elite.
I believe supply narrative is pretty wrong now. Mainly stimulus. Check this video minute 10-30, where you see how much higher the demand has been since june 2020, due to stimulus https://youtu.be/R3OiCFJepUs
Great video as always. Thanks for that. One thing was not clearly mentioned: are you still expecting that the market will melt up before the crash or is your view changing to more bearing on the short and medium term as well.
Crypto and equities look great here. Markets have priced in the hawkish FED tone and may begin to price in the exact opposite (more dovish FED talk). I think we saw the bottom on equities (with the possibility of a divergent low) and so crypto should perform well with a broad rally on the equity markets (Bitcoin often prints significant bottoms with big oversold readings on market breadth).
Many are calling for a melt up before the crash, how much credence do u give to that view? Do u have any suggested targets on SnP500 & Bitcoin as to where this rally can end? The snapshot on this video which shows “We are Here” also suggests that we might have one final leg up? Do u have any suggested timeline as to when you expect this crash or bear market to begin?
I’m often lost with all the clickbaity titles… but you keep mentioning that short term we’ve hit the (local) bottom and should buckle up for a final melt-up. What happens after that melt-up will be bad.
I have analysed the relationship between the Fed Funds Rate and the SPX; besides a normal downward reaction of the markets, once the rate hikes occurred the SPX kept rising, there’s a quite prolonged time delay between a rate hike and a downturn.
Given that a more hawkish development has already been priced in, what do you think will actually happen when and whether the FOMC will announce rate hikes?
Peter and the GOT board,
I am having trouble finding tickers for “commodities.”
Do you all use futures based products? Those seem to have too much decay.
What I have found so far is: XME/HAP/GRES/URNM/IAU/SLV.
How do you all trade oil?
Thanks,
Justin
Thanks for the economics lesson Peter.
Appreciate if you can give your paying members some direction on the markets in the short and medium term.
Also your ratings are all well outdated.
Enjoy your vacation 😉
I echo this Peter @GOT. Markets have really tanked and would appreciate guidance on how to navigate the turmoil now. Like, do you still expect a substantial uptick on S&P before the gradual decline begins? Thanks in advance
Great video – I’d add that a big part of inflation today is supply chain related to world wide Covid labor shortages. The stock market didn’t take off in the 1920’s until the Spanish Flu pandemic ended. I think that’s the difference between the 1920-1940’s charts and today, we are still in a pandemic.
Definitely partly due to labor shortages. Although one could argue that the labor shortages are partly caused by the pent-up demand from stimulus (not just the pandemic).
FED is definitely backed in a corner here with roaring inflation but with economic growth that was capped by a « never-ending » pandemic.
Seeing recent economic data and rising yields on the shorter end of the curve, it’s very possible we see the FED backtracking on their hawkish tone in the next few weeks despite elevated inflation rates. The equity markets will very like « sniff this out » before any sort of FED announcement.
I have to take the contrarian view once more on this. I agree labor shortages have played some roll in supply chain disruption, which as a result has contributed to inflation; however, I still believe the FED is behind it all. The FED created the inflation on purpose to change the monetary system in the future. The FEDS’ 2 mandates are price stability and job creation. They have miserably failed at both. Why would we have a labor shortage if the FED did their job and ensured job growth? And don’t anyone site Covid! That was the cover. They could have stopped inflation at any time over the past year by raising rates (when they should have) and reducing asset purchases. But what did they do instead? Continue reducing rates and increasing asset purchases……massively inflationary. But now they are trying to be the saviors by reversing policy? It’s too little too late and will not work. Once again IMO if they raise rates it will be minuscule and change nothing. There is no digging out of the hole this time without a financial reset, which is coming.
And arguing that labor shortages are partly caused by pent-up demand from stimulus? The last stimulus send out to the average citizen was over 6 months ago. That money is long and gone. It is already in the system or in the pockets of the elite.
I believe supply narrative is pretty wrong now. Mainly stimulus. Check this video minute 10-30, where you see how much higher the demand has been since june 2020, due to stimulus
https://youtu.be/R3OiCFJepUs
Great video as always. Thanks for that. One thing was not clearly mentioned: are you still expecting that the market will melt up before the crash or is your view changing to more bearing on the short and medium term as well.
So time to slowly rotate into Bitcoin/crypto and Gold/PM stocks?
Crypto and equities look great here. Markets have priced in the hawkish FED tone and may begin to price in the exact opposite (more dovish FED talk). I think we saw the bottom on equities (with the possibility of a divergent low) and so crypto should perform well with a broad rally on the equity markets (Bitcoin often prints significant bottoms with big oversold readings on market breadth).
The Fed haven’t raised rates, but market reaction seems like pricing in the more rapid pace of hikes after the next meeting.
Which indicator will be signalling that we’re going from correction into bear market? (I was looking into 200 days ema on weekly, but it didn’t hold).
Interesting because the economic growth through the Obama years was not much different than those of the Great Depression.
Hitch your wagon to a communist economic system. That may work. What is working is the Game of Trades. Thanks
Many are calling for a melt up before the crash, how much credence do u give to that view? Do u have any suggested targets on SnP500 & Bitcoin as to where this rally can end? The snapshot on this video which shows “We are Here” also suggests that we might have one final leg up? Do u have any suggested timeline as to when you expect this crash or bear market to begin?
I’m often lost with all the clickbaity titles… but you keep mentioning that short term we’ve hit the (local) bottom and should buckle up for a final melt-up. What happens after that melt-up will be bad.
I hope you can help us time that well!
Hi Peter,
I have analysed the relationship between the Fed Funds Rate and the SPX; besides a normal downward reaction of the markets, once the rate hikes occurred the SPX kept rising, there’s a quite prolonged time delay between a rate hike and a downturn.
Given that a more hawkish development has already been priced in, what do you think will actually happen when and whether the FOMC will announce rate hikes?
Peter and the GOT board,
I am having trouble finding tickers for “commodities.”
Do you all use futures based products? Those seem to have too much decay.
What I have found so far is: XME/HAP/GRES/URNM/IAU/SLV.
How do you all trade oil?
Thanks,
Justin
Thanks for the economics lesson Peter.
Appreciate if you can give your paying members some direction on the markets in the short and medium term.
Also your ratings are all well outdated.
Enjoy your vacation 😉
I echo this Peter @GOT. Markets have really tanked and would appreciate guidance on how to navigate the turmoil now. Like, do you still expect a substantial uptick on S&P before the gradual decline begins? Thanks in advance