investmentwatchblog.com / JULY 4, 2017
This is a warning that the great bull market in stock prices from the 2009 low is in its last stages.
After 9 years of quantitative easing the Federal Reserve is now starting quantitative tightening. Jim Rickards says it is destined to fail…
Markets continue to not be fully discounted because they don’t have enough information. Contradictions coming from the Fed’s happy talk wants us to believe that QT is not a contractionary policy, but it is.
My estimate is that every $500 billion of quantitative tightening could be equivalent to one .25 basis point rate hike. The Fed is about to embark on a policy to let the balance sheet run down. While I don’t know the figure, let’s give a rough estimate that they lower balance sheets at a rate of $10 billion a month, or $120 billion a year. I would expect for the long-term they’ll look to increase the tempo, which could even reach $20 billion a month or higher.
Under that estimate, it would be the equivalent of half a .25 basis point rate hike just in the first year alone, with expectations of Fed increases from there.
The post The great bull market in its last stages? U.S. car sales fall sharply in June; Silicon Valley begins to crack visibly; October doom? Ron Paul predicts gold up 50% stocks down 25% this October appeared first on Silver For The People.