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April 5, 2020 | Prepare for Debt Deflation, then Hyperinflation

The stock market wafted last week into a psychologically surreal zone somewhere between terror and, if not greed, then at least jittery optimism. How can stocks rally at all when no one can predict whether the deadly spread of coronavirus is about to overwhelm America as it did Italy? The economic picture remains just as […]

April 2, 2020 | Yield Curve Got It Right

My colleague Bob Hoye saw a yield curve inversion that occurred in July as reason to prepare his subscribers for the stock market crash that has ensued. Every inversion since 1857 foretold a recession, suggesting that even without the pandemic, shares were headed for trouble. Still more concerning, he notes, is that the curve inverted twice this […]

April 1, 2020 | A Two-Week Ordeal, then What?

Traders looked beyond the two-week national ordeal that officials have diligently tried to prepare us for and evidently saw more ordeal further down the road.  The Dow dropped a thousand points on Wednesday, but there was no fear, just a mood swing back toward darkness. It will surely pass, at least briefly, but don’t take […]

March 31, 2020 | Eye of the Storm

America is in the eye of the storm, hunkering down for what Mr. Trump promises will be a “very painful two weeks.” Some may have gotten the impression that the economic pain could begin to ease then, but he was talking about the death toll and the rising count of infections. No one can say […]

March 29, 2020 | Don’t Be Dangerously Misled by the Rallie

Over the weekend, we learned enough about the virus to understand why things won’t be trending even remotely back to normal by Easter, as some may have hoped. Grave uncertainties will remain for possibly much longer, including whether spring break will turn out to be a devastating vector of contagion. In early January, a friend’s […]

March 25, 2020 | How the Fed’s $6 Trillion Giveaway Could Backfire Catastrophically

  The U.S. dollar took a massive hit in stride following last week’s announcement of a $6 trillion bailout package. The news caused the greenback as measured by the Dollar Index (DXY) to fall by just a few points from recent highs. The dollar’s seemingly inexplicable strength is a harbinger of the catastrophic debt deflation […]

March 24, 2020 | What Trump Should Do…

To My Readers: I have sent the following note to Sean Hannity, Rush Limbaugh and Holman Jenkins of the WSJ Journal. It is a MUCH better idea than squandering $2 trillion sending out checks to…EVERYBODY. Here is what the President needs to do. Forward this to your Congressman if you agree: President Trump needs to […]

March 23, 2020 | ‘Smart Money’ Is Selling the Rallies, Not Buying the Dips

The pros who confidently bought the dips for more than a decade are now quietly selling the rallies. During the bull market, accumulating stocks on weakness was a no-brainer, as easy a ticket to big profits as investors will ever enjoy. But the bear market has ended this rare opportunity. Instead, the Masters of the […]

March 22, 2020 | ‘Smart Money’ Is Selling the Rallies, Not Buying the Dips

  The pros who confidently bought the dips for more than a decade are now quietly selling the rallies. During the bull market, accumulating stocks on weakness was a no-brainer, as easy a ticket to big profits as investors will ever enjoy. But the bear market has ended this rare opportunity. Instead, the Masters of […]

March 18, 2020 | Strong Dollar Challenges Myth of Fed Omnipotence

The U.S. dollar has been one of the few big market winners lately, but this is hardly a good thing. If the greenback continues to strengthen, it will hurt U.S. multinationals whose overseas revenues are reckoned in currencies that would be falling. In addition, all who owe will need to repay their loans in dollars […]

March 16, 2020 | Will You Be Ready for the Mother of All Rebounds?

  If you’re feeling depressed because your retirement fund has been cut in half by the Covid-19 avalanche on Wall Street, take heart because you may have a good chance to get it back. Yeah, I know, I wrote here only last week that the bear market would stretch on for years, bankrupting us all […]

March 15, 2020 | The Stock Market Has a Fatal Neurological Disease

It feels odd to be characterizing Friday’s 2000-point rally in the Dow Industrials as “just noise,” but that’s what it was. It’s a safe bet that almost none of the buying was driven by optimism about how pandemic news would play out over the weekend. Who could predict such a thing? Uncertainty reins, and the […]

March 12, 2020 | Raise Your Hand if You Plan to Sell into Strength

Financial advisors have been telling clients for years that they should just hang in there when the inevitable selloff came. It’s a safe bet that none of these guys ever uttered the words “bear market” to describe the supposedly healthy correction that eventually would arrive, since that would have spooked investors. Now the correction is […]

March 10, 2020 | Another Doomed Rally? Here’s How to Tell…

With the Dow Industrials up a whopping 1167 points on Tuesday, we need to remind ourselves that the rally was a fraud, driven almost entirely by bears scrambling to meet margin calls.  Indeed, the binge was impelled every inch of the way by steady short-covering. The saps who bought into it are certain to regret […]

March 8, 2020 | Deflation and the Pandemic

  I appeared to occupy a unique place on the lunatic fringe when, many years ago, I started writing about the prospect of a short squeeze on the dollar. When I bounced this idea off a half-dozen finance professors, each had the same response: “Huh?”  Their incredulity notwithstanding, it has always seemed a given to […]

March 6, 2020 | So Now Wall Street Is Crazy About…Biden??

Who could have guessed Wall Street would go crazy over Joe Biden? Stocks staged an epic rally on Wednesday after the 77-year-old comeback kid resurrected his campaign in Super Tuesday balloting. Biden’s success did what the Fed’s 50-basis-point rate cut earlier in the day had failed to do — i.e., rally the stock market. Now, […]

March 2, 2020 | A Short-Squeeze Melt-Up Hasn’t Changed the Odds

Nothing like a little QE chatter to trigger a buying rampage on Wall Street. Powered by freaked-out bears getting hit increasingly with ruinous margin calls as the day wore on, Monday’s short-squeeze panic drove the biggest one-day gain in stock market history. Don’t fight the Fed, as the saying goes, and today’s record-breaker reminded us […]

March 1, 2020 | Relax. The Mainstream Media Has It All Wrong, as Usual

You can relax: Bernie doesn’t have a prayer of winning. And neither does Biden. Or Bloomberg. At times it may seem as though one of these guys could actually give Trump a run for his money. Even I thought so for a brief moment. But that’s only because the gaseous delusion that is Bernie has […]

February 27, 2020 | Charts Saw It Coming, Even If Pundits Did Not

  The stock market at its most violent this week has been an easy read, just as it was when the tech sector imploded 20 years ago and during the financial collapse of 2007-08.  On the eve of today’s memorable carnage the short-term charts practically glowed with warnings of the Dow’s imminent, record-breaking plunge.  I’d […]

February 27, 2020 | Shorts Have Mounting Uncertainty on Their Side

Wednesday’s Whoopee Cushion bounce trapped buyers when the short squeeze apexed around mid-session. The subsequent dive has continued into early evening and portends some tough days ahead for bulls.  I’ve provided some precise downside targets in my latest update for the E-Mini S&Ps, but suffice it to say that if the lower of them is […]

February 24, 2020 | Think Twice about ‘Staying the Course’

In the wake of today’s thousand-point selloff in the Dow, we’re going to be hearing ad nauseum from every shill on Wall Street about how investors should stay the course. Most will be ignorant of technical analysis, or even disdainful of it, but I’d suggest keeping your guard up while the charlatans trot out PE […]

February 23, 2020 | Stocks Finally Give Way to Virus Fears

Now that we are hearing stories about the viral threat of superspreaders, of deepening economic paralysis around the world, and how it could take 18 months to produce a vaccine, investors’ show of bravado in recent weeks seems to have melted away. Shares got hit across-the-board on Thursday and Friday, and if investors know what’s […]

February 18, 2020 | Fevered Investors Eager to Forget the Latest News

Index futures were wafting higher Tuesday night, evidently unfazed by mounting evidence that coronavirus has already slowed the pace of global economic growth significantly.  Such worries as occupy investors’ tiny, fevered brains these days centered on Apple, the most valuable company in the world. (I don’t count Aramco because, well, who cares that it’s actually […]

February 17, 2020 | Be Sure You’re Strapped in Before the Bell!

  Index futures were getting drubbed Monday night on news that Apple’s Q1 revenues will take a hit from coronavirus-related work slowdowns and lower iPhone sales in China. However, it remained to be seen whether this so-far controlled selloff will become an avalanche when stocks open Monday morning. If it were a Sunday night, the […]

February 13, 2020 | Wall Street a Little Too Zen about Coronavirus

Stocks seem to be shrugging off disquieting news about the coronavirus a little too easily, so be careful.  Most of the bad news has concerned the apparent spreading of the disease more rapidly than had been anticipated just a week ago. Far from peaking, the virus seems to be gaining momentum. Wall Street took the […]

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