Correction territory

May 17, 2017 –  We are in correction territory!  As I have written on my March 24, 2017 blog, stocks are poised to lose 10% to 30% in this correction mode.  It may take a while but a dysfunctional White House and the strange behavior of Pres. Trump will hasten the correction.  Here is the pattern I see:  The Dow may lose 300 pts. today, may gain 200 pts. tomorrow, may lose 300 pts. the day after, gain 200 pts. after that and so on.  The Dow may not drop by 2,000 points in one day but it’s coming.  As you have seen the behavior of the market, after the Dow initially breached resistance level of 21,000 it did not get back up there for a long period of time. Perhaps only briefly on certain days.  What should we do?  We have to watch the market carefully. The economy, business and Wall Street are so intricately related that cause and effect are oftentimes hard to define. When investors pull their money out of stocks, where will the money go?  When will investors go back to stocks?  Will the current gloom and doom news in politics and world events affect consumer spending?  The last question is really the most important one because an interruption in consumer spending = recession.  And guess what folks?  Stocks may drop 60% during the bear market that follows a recession.  There is no big problem if you stay in stocks and bonds during periods of corrections since the market should recover relatively quickly.  But it will be a total misery for you if you lose 60% of your retirement savings.  The stock market will crash, but when?   Read the eBook, DOW TO DROP 80% SOON?

You will find out when to get out of equities before the next recession and when to get back into stocks before the start of the bull market that follows a recession.


5%-10% Stock Market Correction

5-10% Stock Market Correction

March 24, 2017 – Folks, the long awaited stock market correction is here at last.  We can expect a 5 to 10% decline from the Dow’s most recent high of 21,000.  As we’ve mentioned before, any bad new can trigger the correction.  It appears that the most recent not so good news that are making investors and the smart money edgy is the realization that not all Trump’s investor friendly proposals will sail smoothly through congress. TrumpCare which is supposed to be the replacement for ObamaCare was thrown out due to lack of support.  This the first indication Trump’s that investor-friendly promises such as reduction of corporate and personal taxes may not see the light of day.  The good news though, is that this consumer driven economy is still going strong.  Transportation sector is stronger than ever which is an indication that a recession is not looming in the horizon yet.  The bad news is that stock prices are really over priced that is why a correction is expected.  For the average investor like you and me, we will be better off leaving your money alone until the next recession which will surely come.  When will that happen, download my eBook, DOW to drop 80% Soon?