1/27/2015 – A negative day with the Dow Jones down 291 points (-1.65%) and the Nasdaq down 90 points (-1.89%).
Hedge fund manager Jeff Gundlach outlines a number of very important observations that I wholeheartedly agree with (watch the video below). Particularly……
- We are in a deflationary environment.
- The FED would be stupid to raise rates due to upcoming economic weakness, strong dollar and no inflation.
- The only reason to raise interest rates in this environment is to re-load on future “recession fighting tools”.
Bingo!!! Despite zero interest rates and a massive credit infusion into our economic system in the form of QE, it is now becoming evident that the real economy is rolling over into a massive recession. If anything, the FED is too late. They should have started raising interest rates about a year ago. Now, they might be forced to raise interest rates into a double whammy of economic slow down and falling stock prices.
Here is the most important thing to consider when it comes to the stock market. I don’t believe the FED will alter their message in terms of raising interest rates over the next few months. And as investors begin to comprehend the unfortunate setup above (raising rates in a recessionary environment) all hell is going to break loose in the stock market. Finally, I believe it is only after a big sell-off that the FED might reconsider raising interest rates. Not before it.
Watch the video below as he continues to discuss gold, oil, etc… It is definitely worth your time.
This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning when the bear market of 2014/15-2017 will start (to the day) and its internal composition, please CLICK HERE.
(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. January 27th, 2015 InvestWithAlex.com
