Member Info for john46

https://www.bloomberg.com/news/articles/2018-09-14/dimon-sees-treasury-yields-at-5-etf-investors-aren-t-buying-it?srnd=premium-europe

"There is an emotional, irrational element to the S&P’s strength, according to the econ professor.

“It has something to do with our president, who is an exceptionally business-oriented president and who wants to deregulate and who favors lower taxes,” he said.

“That has an effect on the market, but I think it goes beyond the rational, logical effect, and it has something to do with our animal spirits. The U.S. is just doing great right now, in terms of the strength of the economy and the stock market.”

“That is kind of psychological, kind of built around the Trump story at this point in history,” Shiller added.

The market’s cyclically adjusted price-to-earnings ratio — a metric that Shiller helped make famous — has climbed to a relatively lofty level, reaching the low 30s. But the CAPE crusader noted in the interview that it topped 45 in 2000, implying it still has room to run.

To be sure, the Nobel laureate offered warnings, as he did in March, when he cautioned President Trump could bring about an economic crisis."

https://www.marke****ch.com/story/stocks-could-get-much-more-highly-priced-on-the-trump-story-says-robert-shiller-2018-09-14

You should know , PI's have just been fleeced to the tune of $680 BN so far this yr on crypto

Spread between US 2 and 10 yr notes down to 20bp , down from 30bp 2 months ago

Jmo,
"But what happens to all the Western debt tied up in China? If things turn really nasty, China's government could stick two fingers up to debtors... It doesn't take much imagination to work out what would happen to world markets if that happens."

Should China , in a fit of frustration decide to dump US debt , they might realise they've been fooled, as there won't be any buyers .That should certainly enhance 10 yr note yields and cause a stock market crash

JMO,
Chinese PI derisking and moving out of equities to saving accounts.
Chinese Municipal bonds mostly classed as Junk
Shanghai Comp <1% from support .
FED , 1 more rate rise this yr , 2 more next yr .
Tariffs and USD will slow Chinese economy.
EM struggling to pay Dollar denominated debt.
US yield inversion round the corner.

Some folk still think all is rosy out there

"Now, 10 years after the collapse of Lehman Brothers, we’re seeing the results of the grandest central-bank experiment in history. On the surface, it looks like mission accomplished. In the U.S., the unemployment rate is near a 48-year low, the S&P 500 Index recently reached another all-time high and consumers are about as confident as they’ve been this millennium. But dig a little deeper, and you’ll find that this road has been paved with debt, debt and more debt — and that it’s a one-way street."

https://www.bloomberg.com/graphics/2018-lehman-debt/?srnd=premium-europe

@ 2cv , why would you want to fill your boots with Lloy in 50's ? when we're over the peak in the economic cycle . You'll have to keep averaging down like LTI to show a paper profit . I never thought you two would have something in common!

James , keep talking sense bud!!

It's a pleasure to see you come out of retirement , and preach the Gospel of Enlightenment.

I have 3 Scottish children . Most of us , hold Freya in high esteem .

Over the years many a female has appeared on here and Freya is the last one standing.

Pick on me big boy !!

"Former Treasury Secretary Lawrence Summers called the results of the most recent Federal Reserve stress test of the largest banks “comically absurd,” and called on regulators to boost capital at financial institutions."

"In the most recent stress test, the worst scenario described “a severe global recession” with 10 percent U.S. unemployment, plunging house prices, and a 65 percent fall in stock prices."

https://www.bloomberg.com/news/articles/2018-09-08/larry-summers-calls-latest-fed-bank-stress-test-results-absurd

Where I disagree with your observations , is that personally US will cause the crash , and SE Asia followed by China will be the first dominoes to fall .

ATB bud

I have respect your logic that UK is impervious to external forces , even though I disagree

As mentioned previously , minimising exposure , just cash, gold, land and property.

Will short HL and EMG when I feel gold has troughed.

See you at 28p

There will be one more push upwards across Western Indices , before the fun starts.

You should know the above !

Lloy

Lti,

I honestly hope you are pulling our leg.

You are intoning UK PLC is impervious to external factors

LTI,

"There is now no dot com bubble to burst. To get another 50% drop there would have to be another world financial crash unless you think leaving the EU will have the same effect."

You need to clarify the above sentence. As I interpret it , you don't believe there are any bubbles out there.

"Take trade volumes. It’s been extraordinarily unusual for the momentum of global commerce to head anywhere but up in recent decades. The only notable occasions when the world trade monitor compiled by the CPB Netherlands Bureau for Economic Policy Analysis has turned down in a sustained way since 2000 have been on the eve of the 2001 and 2008 recessions, and during the 2015 commodity slump.

Past the Peak
Rolling three-month trade volumes are already in decline, a rare situation in recent decades

Source: CPB Netherlands, Bloomberg Opinion calculations
Note: Based on rolling three-month-to-three-month change in average trade volumes.
You can now add 2018 to that list, with the index coming in negative throughout the second quarter of this year. That drop is particularly striking given that commodities, one of the largest and most volatile subsets of globally traded goods, have been doing quite well – the CPB’s indexes of fuels and non-fuel commodities both reached the highest levels since 2014 in May. The weakness is coming not from materials but from manufactured goods, as global supply chains seize up."

https://www.bloomberg.com/view/articles/2018-09-07/the-global-trade-slowdown-is-happening-now?srnd=premium-europe

Cont,

http://www.marketoracle.co.uk/Article63035.html

Worth a read

Trading Any Market
Financial Markets Are Nearing the Line in the Sand
Stock-Markets / Financial Crisis 2018
Sep 02, 2018 - 01:12 PM GMT
By: Harry_Dent

Stock-Markets
Most of the classic technical indicators favor a continued rally in stocks into 2019.

And that’s still my preferred scenario for a final peak. One that happens in late 2019, coming off of this Trump rally that started in late 2016.

It could be near its peak growth rate after the 4.1% GDP report.

But it’s not likely to be sustainable for long given that we are running out of workers to rehire, and the real estate bubble seems to be finally be running out of steam due to such high prices making homes and rentals unaffordable.



So, do we peak just ahead, or could it sustain well into 2019 before peaking… and I see low chances of it sustaining past that point where our proven fundamental indicators are the lowest between 2020 and 2023.

The first warning sign for the near-term peak is the sharp collapse in the Smart Money Flow Index over this year’s rally after the late January 2018 peak.

But another warning sign is the collapse in China’s stock prices down 26% recently, after a second bubble peaked in late 2015, and crashed 49% into early 2016.

Such a continued crash would be a bad sign for the global economy, not just China. If it breaks much below its major support at 2,638, it’s due to crash to at least 2,000 in the next year, and more likely to 1,000 over the next few years. And it’s just a bit less than 1% from that level on Friday (8/17).

https://economyandmarkets.com/wp-content/uploads/2018/08/ENM_8-20.png

This has been a classic dead cat bounce scenario ever since that low in early 2016 – which is now failing again and approaching the lows of the last crash at 2,638.

The ultimate support level is 1,000, at the bottom in 2006 just before the first great bubble that peaked at 6,200 in late 2007 and crashed 72% to follow.

Emerging market stock indices are also down just over 20%, with a rising dollar and interest rates that they largely borrow in impacting them negatively…

This could be the next subprime crisis in debt, as most of global debt came from emerging countries since the 2008 debt crisis when the U.S. had lower interest rates and a lower dollar.

This is important.

It would come with an acceleration of the trade war which is already happening – and rising dollar and interest rates – which looks likely ahead by my longer-term forecast based off of chart patterns.

It’s a crucial trend for me and you to follow. If China’s second bubble heads down again, it would favor a top in late 2018 for the U.S. and global economy, since China has the second largest, fastest growing economy, and is the most leveraged.

China’s Shanghai has bounced a bit recently as we approach this critical level…

But a break much below 2,600 could be a curtain call for China.

And yet this is another indicator that stocks in the U.S. could

Spot on , can't argue with such analogy .

Wids , surely when dollar goes out of fashion , there'll be more banana Republics . Should it not be long bananas?lol