I’m going over a headline that I saw on Forbes.com. “Stock market at critical level and brace for high risk of collapse of March.” In summary, could the be a stock market collapse in next month?
Here’s what investors should know based on essentials facts in this article:
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Inflation and Federal Reserve interest rate hikes have fueled many fears driving the—ongoing stock weaknesses. In addition, the trend in earning projections determines the depth and length of most bear markets. This analysis was from Michael Wilson, team lead at Morgan Stanley.
Stocks have rallied as corporate earnings come out but then plunged in the month leading up to new reports, which consistently show companies setting profit expectations. There is a notion about blaming high inflation and the Federal Reserve interest rates. However, media outlets like Forbes always need to remember to mention the root cause of it the national debt of the U.S. and the Western world. These governments are plagued with massive debt.
“This is not just a magical problem that causes inflation. But the real reason is that after surging more than 16% since October and abruptly fell 3% last week, which is true. S&P is at a critical level”, cautious as Wilson.
“And it is at high risk. A bear market can induce a forceful stock plunge in March. That’s possible, from what I’m seeing.”
I’ve seen stock companies lately, the ones I generated yesterday. They are much more volatile, and they’re the ones that are supposed to have low volatility. However, I have a set from last week that still holds pretty strong positions open today, so I’m still determining where they are.
“Considering the minimal momentum left in the market, I see that these continuous, relentless efforts, too, slow down the economy. They’ve already slowed it down, which will inevitably hurt earnings and push stocks to a multi-year low. So it is telling investors grades for increased volatility.”
I’m already seeing that since it’s become increasingly clear this year. The Fed has not yet finished its rate hikes; as far as I know, they’re about 1/4 percent. And there was an article or somewhere I read or heard that if the. Interest rates at the Fed level go beyond 8%.
There will be quite possibly a significant collapse for the U.S. economy just because there’s only because of debt at all levels, be it state or municipal, or federal level. If it hits a certain point, it will put much negative pressure on the U.S. financial system.
Also, somebody mentioned that if the treasuries hit about 6%, then yeah, we will. Have problems so.
This article continues a particularly tough year for stocks. And fed-induced global market sell-off yields on ten-year Treasury are more than twice the S&P 500 estimated dividend yield.
“Bad news for stocks, but opportunities for investors looking to lock in with income with less volatile assets.” That’s true for now. However, this is where it gets interesting.
As we know, Texas factory activity fell on February 1st since May 2020. Texas has been intense. February has been a slow month. It’s harder to understand why, but our general outlook for business and retail activity has worsened.
We’re unsure if the Fed is jockeying with interest rates or some cyclical slowdown, but the company factory output has fallen.
I can’t say yes or no, but the high-performing stock sectors are doing reasonably well. They’re just mid-caps in specific industries that appear to be doing well there. There are pockets of companies doing reasonably well, which reflects that there is activity out there
Now the other thing is gold and silver are not. There you would think of both as defensive moves. I do not see any activity with gold and silver.
I believe those only move when there’s a final major catalyst. Look at the financial crisis in the last 15 years was one.
The virus pandemic has been the other big one. Since 2020, I can tell you that the global risk has already exceeded the peak financial crisis level. Is this a genuine concern? Yes, as the debt levels have risen and increased, it has become a global risk.
So continuing this article, Forbes staff writers need to give you the underlying reasons for what’s driving this. It is dishonest telling you you must not just watch raw data globally, even at a micro level, especially in the U.S., because they need help explaining it. It’s as simple as global debt, anyway. It’s continuing long after hitting a nearly two-year low in October, stocks rallied, and signs of inflation were slowing started to about, but this month has shown the journey to average price levels much longer.
Then hope then many hope what I could say about inflation is that. I see essential inputs elevated. They’re not spiking as they were last year in 2020. There’s a lot of price volatility, like in oil.
It is unclear when the Fed will stop raising rates. Another rate hike to their forecast, falling another hotter-than-expected inflation reading earlier this month. After that, they expect the Central Bank to raise rates to a top level of 5 1/2%, potentially hitting the highest level in over 20 years.
Another problem is that inflation is suppressed, so building a false rebound in the markets and for fake weaker reasons why wealth and growth have been growing; it’s because of—flooding the markets with so much cash and making everything in the global market highly liquid. And there’s a price to pay for it. And now we’re seeing it. We’re seeing it with inflation.
We see with higher interest rates, and that’s going to kill off companies, and we’ll probably enter in this well, we’re probably already in stagflation.
So the question is, what are the Alternatives? Where do we hide? I look at my Oanda data, whether forex or CFD. I never recommend people to buy into CFD, but data is an excellent insight to use as what’s doing well globally.
What I see for sure is that European markets are outperforming the U.S. The specific ones are Germany, France, and somewhat Netherlands.
The other areas where I see some growths are in currencies outside the six significant pairs.
We’re talking about exotic currency pairs that you wouldn’t think are formerly known as being volatile, but because everything’s so explosive—Topsy turvy and unpredictable with our high volatility environment and the increased interest. So, rate the ones that you traditionally would think were volatile as no longer volatile. So, there are some opportunities there.
Generally, I’m finding only one currency pair for Asia. I do not see any—growth at all in. So, yeah, just Asia is the one area that you would think would pick this up, namely China. Unfortunately, it doesn’t seem to be popping in China as you think it would after this reopening.
The markets over there as well, the currency is not that strong.
There is some potential with the India Rupee. What I see with the Indian markets, they’re not as strong. I could be wrong, as you want them to be so well, but that’s what I see. They’re not a top performer, but Europe is.
For now, if things get bad, I don’t know if gold may spike a little bit or silver, but I’m always about trying to find the top performers where the top performers will be in currencies.
Bitcoin, depending on what happens to the U.S. dollar, that’s another area I’ve yet to talk about. However, the U.S. dollar is starting to show signs of strength again.
And if you’re looking at crypto like Bitcoin as a savior, if it’s a U.S. dollar, that’s a savior, so be it. Put money in there. And the DXY index
Because of last year, the DXY. It was the strongest out of any—asset for all last year in 2022. So, we may also enter that period, outperforming even the Treasury bill
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