Today's Market
by Dr Invest

I should be humored by the "big mouthed", "over confident" analysts who are now ringing their hands and scurrying around in sheer panic. This is the way a market crashes; it is unpredictable and unforseen. Far too much confidence has been placed in central banks (the Federal Reserve). They can bolster markets for a while, but eventually even the game players realize that they are being played and everyone loses confidence in the government hype. EXCEPT.... EXCEPT.... EXCEPT the poor middle-class fool who put his hope in the investment adviser dream-maker. The poor middle-class fool has been sold the bill of goods that the wisdom of his financial adviser in placing them into a buy and hold investment will perform the best in the long run. The problem is that study after study has shown that since the year 2000, that kind of investment strategy has failed.

We Break this Article for a Moment of Panic

Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi said: "Consumers have pulled back, pulled back big. It's a little scary out there," Manufacturing data for the New York region also showed a slowdown, with the New York Fed's Empire State index plunging to 6.2 percent in October after hitting a five-year high last month. "Whatever the data is telling us ... it's kind of hard to swallow. Exports were at a record in August. Unemployment is coming straight down. I'm mystified by the data," Rupkey said.

Back to the Article

The Dalbar Study and many other analysts have pointed to major changes in stock investment over the past 14 years. When financial advisers sell their products.... and that is what they are doing.... they always take a clip of the seasons of the most rosy returns. If, they say, you had put $10,000 in XYG FUND in 1983, you would have gained blah blah percent. They are selecting that period because it shows a season of the best returns. If they say, "If you had invested $10,000 over the past three years, look at how much you would have gained.", they are using a the rapid growth in the stock market to fool you into thinking that future years will do the same. Think STIMULUS! The government has been causing that growth in stocks. The government has been trying to create a WEALTH EFFECT. There is no valid robust economy, the hard working, middle class fools have been duped by the young, bonus driven brokers and financial advisers preying on the uninformed. And when the market falls, the high flying sells team that misinformed you, will take their millions and retire in Costa Rica at 38 years of age. 

Getting Your Feet Back On the Ground

I am settling-in for a possible rebound and then a serious collapse in the economy. I don't know that the time is NOW, but it is soon. If you have made 15% or 20% returns since 2012, sell and cement your gains. I think there is rough financial weather ahead in the next six months. I expect a rebound until the end of the year, but that doesn't have to happen when you consider that the market actually collapsed in 2012. (See previous blogs and copper prices)

If you have made money, now is the time to take profits and run. Yamada said, "I'd rather be out of the market, wishing I was in; than be in the market, wishing I was out!" 

(The above article is for entertainment purposes ONLY, and is not to be used as investment advice.)