The market is poised for a strong rally today, based in part on the alleged cease-fire in the US-China trade war.
Will it really come to pass? Who knows, but the bulls are counting on it. They’re also counting on the Fed to start cutting rates very soon. After all, who doesn’t like free money?
Bull Case versus Bear Case
Fearful of another recession, Americans are losing sleep over their finances.
Bitcoin is very likely to crash soon, research shows.
Gold Heads for Biggest Monthly Gain Since 2016.
U.K. June Consumer Confidence Drops as GfK Sees Turbulent Summer.
There’s a Global Market Slump Ahead, Elliott’s Paul Singer Says.
The yield curve is a valuable forecasting tool. It is simple to use and significantly outperforms other indicators in predicting recessions six to twelve months ahead.
Five Recession Models
1. New York Federal Reserve
2. JPMorgan
3. ECRI via AdvisorPerspectives
4. Guggenheim
5. ZenInvestor.org
Final Thoughts
The stock market is on the verge of melting up, which is just what the bullish camp has been waiting for. This melt up could begin today. There is a lot of optimism about a grand deal between US and China on trade policy. But it’s far from certain that such a deal will happen. The two sides are miles apart in what they want, and Xi has demonstrated that he’s just as tough as Trump when it comes to making deals.
Therefore, I think it would be wise for investors to take some profits on this melt up. I don’t mean sell everything. Just lighten up a bit on equity exposure.
Xi and he Chinese are building trading relationships all over the southeast Asia, Africa, and into Europe. Eventually they will no longer need that much to trade with the US. Go read about the their road and belt project. They will just string Trump and the US along forever until Trump is gone. This is the Chinese negotiating style.
At some point we will need to trade with them more than they need to trade with us. Then they will dictate the terms.
It is happening and Trump is being out negotiated and does not have a clue. It is sad for him and our country
Hi there, just wanted to say, I enjoyed this article.
It was very helpful. You do good stuff. – Heath