Helping you navigate the new normal since 2001
Two major wars are underway in Europe and the Arabian Gulf. The IEA continues to warn that they have already created “the largest energy supply disruption in history”. And now, it seems financial markets are waking up to the major risks created by the $2.6tn AI bubble
We are back in a world where geopolitics, not economics, drives decision-making. It is a world of shifting alliances. And so defence spending is set to be a key growth area for the future as Cold War 2.0 begins.
Markets are finally rediscovering their core role of price discovery. The US 10-year rate has risen 0.5% since the Fed cut its rate by 0.5%. And so the clock is now ticking for the biggest stock market bubble of our lifetimes.
NVIDIA moves to new highs, whilst nearly half of major US companies have no earnings Read More
investors are hoping Fed Chairman Jay Powell will soon signal a dramatic interest rate cut. And so they are positioning for a ‘Santa Claus’ rally. But most adults know that Santa Claus doesn’t really exist.
Investors hope (again) for interest rate cuts and a ‘Santa Claus rally’ Read More
300+ years of Bank of England data shows that interest rates are typically inflation plus 2.5%. At today’s level, this would imply – US rates would be 3.7% + 2.5% = 6.2%: Japan would be 3.2% + 2.5% = 5.7%: Eurozone rates would be 5.3% + 2.5% = 7.8%; UK rates would be 6.7% + 2.5% = 9.2%
It seems highly likely that the Rebound rally is ending, and the market Downtrend is about to resume. Time spent on researching the paradigm shifts that will take us into the New Normal will likely prove very profitable for the future
Stock markets on the brink as the end of ‘Presidential Cycle’ support looms Read More
“You can’t run the most reckless monetary and fiscal experiment in history without the bill eventually coming due. The first invoice arrived as inflation. The second has come as a financial panic, with economic damage that may not end with Silicon Valley Bank.”
Its ‘Minsky Moment’ time again as investors start to worry about return of capital Read More
The smartphone market has now been in decline for 5 years. And whilst the Fed would clearly love to get stocks racing to the moon again, history suggests that Apple’s CFO is likely to be right when auggesting that cost control, not innovation, is likely to be key for the future.
Now, we are all starting to suffer for the central banks mistake in adopting Bernanke Theory. The bubbles they created are finally starting to burst as interest rates return to more normal levels. This will be very painful for all those who trusted them to manage the economy.
“FANGs” lose their teeth as stock markets relearn their key role of price discovery Read More
Apple symbolises the major changes underway in the economy. Its stock price is in decline as central bank stimulus disappears. And its profits are threatened as pressure builds on its supply chain and pricing.
Apple’s China problems highlight smartphone market downturn Read More
The history of the 1929 and 2000 downturns suggests the real pain is yet to come. Housing markets look terribly over-valued around the world, as I noted last month. And US consumer sentiment is at all-time lows. So most company earnings seem set to fall, with more than 60% of US CEOs now expecting to see a recession.
The market downturn couldn’t have come at a worse time for Apple. It was already facing major supply chain chaos in Q2. And now it has to face a major decline in the smartphone market itself. Inevitably this will lead to a brutal battle for market share as companies struggle to survive.
Smartphone sales set to tumble as China’s lockdowns continue Read More
The central banks are now abandoning the ‘Bernanke Doctrine’ set out in November 2010 – that what was good for markets, was good for the economy.
The Fed’s NASDAQ bubble starts to burst as Netflix, Facebook plunge 30% Read More
Our pH Report Sentiment Index has been a very reliable guide to the S&P 500 in recent years. Now it is suggesting a major downturn may be underway as the US and Chinese stimulus programmes come to an end.
The Federal Reserve can’t control the fallout from the bursting of China’s ‘subprime on steroids’ real estate bubble
The Fed’s stock market bubble is at risk as China bursts its real estate bubble Read More
OPEC under pressure, China worries about off-balance sheet debt Read More
US inflation “surprise” puts Federal Reserve under pressure Read More
US jobs report punctures dream of quick return to “normal” Read More
Biden calls time on Reagan’s “trickle-down economics” Read More
“Investing illusions can continue for a surprisingly long time”, Warren Buffett Read More
Investor mania is a classic sign of a late-stage bubble Read More
*Limited availability. First come, first served.
Rising uncertainty hits market sentiment and prices Read More
*Limited availability. First come, first served.
Biden’s plain-speaking will return markets to reality Read More
*Limited availability. First come, first served.
*Limited availability. First come, first served.
*Limited availability. First come, first served.
2021 unlikely to see a quick return to ‘business as usual’ Read More
*Limited availability. First come, first served.
OPEC and the Federal Reserve hold off reality for a (little) longer Read More